10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 23, 2012

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                    to                    

Commission file number 1-13859

AMERICAN GREETINGS CORPORATION

(Exact name of registrant as specified in its charter)

Ohio	34-0065325
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One American Road, Cleveland, Ohio	44144
(Address of principal executive offices)	(Zip Code)

(216) 252-7300

(Registrant’s telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  x    No  ¨

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

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes  ¨    No  x

As of December 27, 2012, the number of shares outstanding of each of the issuer’s classes of common stock was:

Class A Common	28,780,998
Class B Common	2,856,813

AMERICAN GREETINGS CORPORATION

INDEX

	Page Number
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements		3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		22
Item 3. Quantitative and Qualitative Disclosures About Market Risk		35
Item 4. Controls and Procedures		36
PART II—OTHER INFORMATION
Item 1. Legal Proceedings		37
Item 1A. Risk Factors		39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		39
Item 6. Exhibits		40
SIGNATURES		42
EXHIBITS

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

AMERICAN GREETINGS CORPORATION

CONSOLIDATED STATEMENT OF OPERATIONS

(Thousands of dollars except share and per share amounts)

	(Unaudited)
	Three Months Ended						Nine Months Ended
	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Net sales	$	499,368		$	458,535		$	1,275,139		$	1,217,800
Other revenue		7,446			6,472			18,617			21,097
Total revenue		506,814			465,007			1,293,756			1,238,897
Material, labor and other production costs		244,071			230,572			584,667			546,699
Selling, distribution and marketing expenses		190,041			141,501			466,199			392,630
Administrative and general expenses		74,483			60,510			225,521			186,734
Other operating income – net		(2,217	)		(813	)		(1,421	)		(6,858	)
Operating income		436			33,237			18,790			119,692
Interest expense		4,504			5,821			13,314			17,708
Interest income		(65	)		(207	)		(297	)		(838	)
Other non-operating (income) expense – net		(1,904	)		(2,077	)		3,523			(2,621	)
(Loss) income before income tax (benefit) expense		(2,099	)		29,700			2,250			105,443
Income tax (benefit) expense		(1,290	)		9,454			63			38,128
Net (loss) income	$	(809	)	$	20,246		$	2,187		$	67,315
(Loss) earnings per share – basic	$	(0.03	)	$	0.51		$	0.06		$	1.67
(Loss) earnings per share – assuming dilution	$	(0.03	)	$	0.50		$	0.06		$	1.63
Average number of shares outstanding		31,877,088			39,480,798			33,712,073			40,226,039
Average number of shares outstanding – assuming dilution		31,877,088			40,436,865			34,478,737			41,381,157
Dividends declared per share	$	0.15		$	0.15		$	0.45		$	0.45

See notes to consolidated financial statements (unaudited).

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AMERICAN GREETINGS CORPORATION

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Thousands of dollars)

	(Unaudited)
	Three Months Ended						Nine Months Ended
	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Net (loss) income	$	(809	)	$	20,246		$	2,187		$	67,315
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		2,680			(15,592	)		(91	)		(12,554	)
Pension and postretirement benefit adjustments		145			536			643			607
Unrealized loss on securities		—			(1	)		(1	)		—
Other comprehensive income (loss), net of tax		2,825			(15,057	)		551			(11,947	)
Comprehensive income	$	2,016		$	5,189		$	2,738		$	55,368

See notes to consolidated financial statements (unaudited).

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AMERICAN GREETINGS CORPORATION

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(Thousands of dollars)

	(Unaudited)			(Note 1)			(Unaudited)
	November 23, 2012			February 29, 2012			November 25, 2011
ASSETS
Current assets
Cash and cash equivalents	$	63,291		$	132,438		$	85,661
Trade accounts receivable, net		197,844			113,840			235,318
Inventories		264,330			208,945			214,412
Deferred and refundable income taxes		80,502			58,118			57,400
Prepaid expenses and other		155,543			123,419			123,481
Total current assets		761,510			636,760			716,272
Goodwill		—			—			27,713
Other assets		460,647			503,700			417,479
Deferred and refundable income taxes		120,870			121,228			128,595
Property, plant and equipment – at cost		1,004,686			924,512			904,555
Less accumulated depreciation		642,994			636,736			637,334
Property, plant and equipment – net		361,692			287,776			267,221
	$	1,704,719		$	1,549,464		$	1,557,280
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	194,945		$	86,166		$	108,254
Accrued liabilities		82,893			58,657			67,596
Accrued compensation and benefits		60,702			68,317			58,411
Income taxes payable		14,641			7,409			26,626
Deferred revenue		26,404			35,519			29,477
Other current liabilities		44,287			49,013			60,963
Total current liabilities		423,872			305,081			351,327
Long-term debt		356,832			225,181			234,642
Other liabilities		259,787			269,367			182,565
Deferred income taxes and noncurrent income taxes payable		21,008			22,377			21,769
Shareholders’ equity
Common shares – Class A		28,849			34,011			35,562
Common shares – Class B		2,860			2,842			2,778
Capital in excess of par value		520,119			513,163			509,999
Treasury stock		(1,093,789	)		(1,020,838	)		(995,338	)
Accumulated other comprehensive loss		(11,279	)		(11,830	)		(14,293	)
Retained earnings		1,196,460			1,210,110			1,228,269
Total shareholders’ equity		643,220			727,458			766,977
	$	1,704,719		$	1,549,464		$	1,557,280

See notes to consolidated financial statements (unaudited).

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AMERICAN GREETINGS CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS

(Thousands of dollars)

	(Unaudited)
	Nine Months Ended
	November 23, 2012			November 25, 2011
OPERATING ACTIVITIES:
Net income	$	2,187		$	67,315
Adjustments to reconcile net income to cash flows from operating activities:
Stock-based compensation		7,806			8,038
Gain on dispositions		—			(4,500	)
Net loss (gain) on disposal of fixed assets		394			(807	)
Depreciation and intangible assets amortization		36,095			32,993
Provision for doubtful accounts		17,771			4,879
Impairment of Clinton Cards debt		10,043			—
Deferred income taxes		809			6,412
Gain on sale of Party City investment		(4,293	)		—
Other non-cash charges		892			2,747
Changes in operating assets and liabilities, net of acquisitions:
Trade accounts receivable		(101,363	)		(122,298	)
Inventories		(39,105	)		(30,939	)
Other current assets		(17,877	)		6,470
Income taxes		(15,336	)		3,362
Deferred costs – net		23,702			(3,838	)
Accounts payable and other liabilities		112,283			3,528
Other – net		(1,913	)		98
Total Cash Flows From Operating Activities		32,095			(26,540	)
INVESTING ACTIVITIES:
Property, plant and equipment additions		(87,408	)		(48,956	)
Cash payments for business acquisitions, net of cash acquired		621			(5,899	)
Proceeds from sale of fixed assets		559			9,046
Proceeds from sale of intellectual properties		—			4,500
Proceeds from sale of Party City investment		4,920			—
Purchase of Clinton Cards debt		(56,560	)		—
Total Cash Flows From Investing Activities		(137,868	)		(41,309	)
FINANCING ACTIVITIES:
Net increase in long-term debt		131,651			—
Issuance or exercise of share-based payment awards		(496	)		12,293
Tax (deficiency) benefit from share-based payment awards		(376	)		2,380
Purchase of treasury shares		(78,742	)		(55,304	)
Dividends to shareholders		(15,182	)		(18,146	)
Total Cash Flows From Financing Activities		36,855			(58,777	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH		(229	)		(3,551	)
DECREASE IN CASH AND CASH EQUIVALENTS		(69,147	)		(130,177	)
Cash and Cash Equivalents at Beginning of Year		132,438			215,838
Cash and Cash Equivalents at End of Period	$	63,291		$	85,661

See notes to consolidated financial statements (unaudited).

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AMERICAN GREETINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Three and Nine Months Ended November 23, 2012 and November 25, 2011

Note 1—Basis of Presentation

The accompanying unaudited consolidated financial statements of American Greetings Corporation and its subsidiaries (the “Corporation”) have been prepared in accordance with accounting principles generally accepted in the United States 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 of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary to fairly present financial position, results of operations and cash flows for the periods have been included.

The Corporation’s fiscal year ends on February 28 or 29. References to a particular year refer to the fiscal year ending in February of that year. For example, 2012 refers to the year ended February 29, 2012. The Corporation’s subsidiary, AG Retail Cards Limited, which operates the recently acquired retail stores in the United Kingdom (also referred to herein as “UK”), is consolidated on a one-month lag corresponding with its fiscal year-end of February 2 for 2013. See Note 4 for further information.

These interim financial statements should be read in conjunction with the Corporation’s financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended February 29, 2012, from which the Consolidated Statement of Financial Position at February 29, 2012, presented herein, has been derived. Certain amounts in the prior year financial statements have been reclassified to conform to the 2013 presentation. These reclassifications had no material impact on financial position, earnings or cash flows.

The Corporation’s investments in less than majority-owned companies in which it has the ability to exercise significant influence over the operation and financial policies are accounted for using the equity method except when they qualify as variable interest entities (“VIE”) and the Corporation is the primary beneficiary, in which case, the investments are consolidated in accordance with Accounting Standards Codification (“ASC”) Topic 810 (“ASC 810”), “Consolidation.” Investments that do not meet the above criteria are accounted for under the cost method.

The Corporation holds an approximately 15% equity interest in Schurman Fine Papers (“Schurman”), which is a VIE as defined in ASC 810. Schurman owns and operates specialty card and gift retail stores in the United States and Canada. The stores are primarily located in malls and strip shopping centers. During the current period, the Corporation assessed the variable interests in Schurman and determined that a third party holder of variable interests has the controlling financial interest in the VIE and thus, the third party, not the Corporation, is the primary beneficiary. In completing this assessment, the Corporation identified the activities that it considers most significant to the future economic success of the VIE and determined that it does not have the power to direct those activities. As such, Schurman is not consolidated in the Corporation’s results. The Corporation’s maximum exposure to loss as it relates to Schurman as of November 23, 2012 includes:

• the investment in the equity of Schurman of $1.9 million;

• the limited guaranty (“Liquidity Guaranty”) of Schurman’s indebtedness of $12.0 million;

• normal course of business trade and other receivables due from Schurman of $29.8 million, the balance of which fluctuates throughout the year due to the seasonal nature of the business;

• the operating leases currently subleased to Schurman, the aggregate lease payments for the remaining life of which was $15.0 million, $22.1 million and $24.9 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively; and

• the subordinated credit facility (the “Subordinated Credit Facility”) that provides Schurman with up to $10.0 million of subordinated financing.

The Corporation provides Schurman limited credit support through the provision of a Liquidity Guaranty in favor of the lenders under Schurman’s senior revolving credit facility (the “Senior Credit Facility”). Pursuant to the terms of the Liquidity Guaranty, the Corporation has guaranteed the repayment of up to $12.0 million of Schurman’s

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borrowings under the Senior Credit Facility to help ensure that Schurman has sufficient borrowing availability under this facility. The Liquidity Guaranty is required to be backed by a letter of credit for the term of the Liquidity Guaranty, which is currently anticipated to end in January 2014. The Corporation’s obligations under the Liquidity Guaranty generally may not be triggered unless Schurman’s lenders under its Senior Credit Facility have substantially completed the liquidation of the collateral under Schurman’s Senior Credit Facility, or 91 days after the liquidation is started, whichever is earlier, and will be limited to the deficiency, if any, between the amount owed and the amount collected in connection with the liquidation. There was no triggering event or liquidation of collateral as of November 23, 2012 requiring the use of the guaranty.

The Subordinated Credit Facility that the Corporation provides to Schurman had an initial term of nineteen months expiring on November 17, 2010, however, unless either party provides the appropriate written notice prior to the expiration of the applicable term, the facility automatically renews for periods of one year, except in the case of the last renewal, in which case the facility can only renew for the partial year ending on the facility’s expiration date of June 25, 2013. Schurman can only borrow under the facility if it does not have other sources of financing available, and borrowings under the Subordinated Credit Facility may only be used for specified purposes. Borrowings under the Subordinated Credit Facility are subordinate to borrowings under Schurman’s Senior Credit Facility and the Subordinated Credit Facility includes affirmative and negative non-financial covenants and events of default customary for such financings. As of November 23, 2012, Schurman had not borrowed under the Subordinated Credit Facility.

In addition to the investment in the equity of Schurman, the Corporation held a minority investment in the common stock of Party City Holdings, Inc. (“Party City”), formerly known as AAH Holdings Corporation. On June 4, 2012, Party City announced that it entered into a definitive agreement (the “Merger Agreement”) to sell a majority stake of the company in a recapitalization transaction valued at $2.69 billion. On July 27, 2012, this transaction closed and Party City merged with and into PC Merger Sub, Inc., a wholly-owned subsidiary of PC Topco Holdings, Inc. (“Holdings”). Contemporaneously with the closing, on July 27, 2012, the Corporation exchanged 617.3 shares of its Party City common stock for 1,200 shares of common stock of the new company, Holdings, and sold its remaining 123.44 shares of Party City common stock for $4.9 million, recording a gain of $3.2 million. Cash proceeds from the sale, which totaled $4.9 million were received during the three months ended November 23, 2012 and are reflected in investing activities on the Consolidated Statement of Cash Flows. The terms of the Merger Agreement include certain provisions contemplating the adjustment of the purchase price paid in the transaction under certain circumstances. As a result, approximately $1 million of the cash consideration potentially payable to the Corporation in exchange for its shares of Party City common stock was being withheld in escrow until resolution of any such purchase price adjustment. On November 21, 2012, the purchase price adjustment was finalized and a gain totaling $1.1 million was recognized in the three months ended November 23, 2012. The cash proceeds were received in December 2012. The investment in Schurman and the investment in Holdings totaled $10.7 million as of November 23, 2012, and are accounted for under the cost method.

During the nine months ended November 23, 2012, the Corporation recorded certain charges associated with activities and transactions related to Clinton Cards PLC (“Clinton Cards”) that do not have comparative amounts in the prior year period. See Note 4 for further information.

Note 2—Seasonal Nature of Business

A significant portion of the Corporation’s business is seasonal in nature. Therefore, the results of operations for interim periods are not necessarily indicative of the results for the fiscal year taken as a whole.

Note 3—Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2011-04 (“ASU 2011-04”), “Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” ASU 2011-04 improves comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. generally accepted accounting principles and International Financial Reporting Standards. ASU 2011-04 clarifies the application of existing fair value measurement requirements including (1) the application of the highest and best use and valuation premise concepts, (2) measuring the fair value of

8

an instrument classified in a reporting entity’s shareholders’ equity, and (3) quantitative information required for fair value measurements categorized within Level 3. ASU 2011-04 also provides guidance on measuring the fair value of financial instruments managed within a portfolio and application of premiums and discounts in a fair value measurement. In addition, ASU 2011-04 requires additional disclosure for Level 3 measurements regarding the sensitivity of fair value to changes in unobservable inputs and any interrelationships between those inputs. The amendments in this guidance are to be applied prospectively, and are effective for interim and annual periods beginning after December 15, 2011. The Corporation adopted this standard on March 1, 2012. The adoption of this standard did not have a material effect on the Corporation’s financial statements.

In June 2011, the FASB issued ASU No. 2011-05 (“ASU 2011-05”), “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of changes in shareholders’ equity and requires the presentation of components of net income and other comprehensive income either in a single continuous statement or in two separate but consecutive statements. In addition, ASU 2011-05 requires presentation of reclassification adjustments for each component of accumulated other comprehensive income in both the statement in which net income is presented and the statement in which other comprehensive income is presented. In January 2012, the FASB issued ASU No. 2011-12 (“ASU 2011-12”), “Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassification of Items out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” ASU 2011-12 defers the effective date of the requirements made in ASU 2011-05 pertaining to presentation of reclassification adjustments for each component of accumulated other comprehensive income in both net income and other comprehensive income on the face of the financial statements. ASU 2011-12 reinstates the previous requirements to present reclassification adjustments either on the face of the statement in which other comprehensive income is reported or to disclose them in the notes to the financial statements. The other requirements in ASU 2011-05 are not affected by ASU 2011-12. ASU 2011-05 and ASU 2011-12 are effective for interim and annual periods beginning after December 15, 2011. Effective March 1, 2012, the Corporation adopted the two consecutive statements approach for the presentation of components of net income (loss) and other comprehensive income (loss) and a total for comprehensive income. The Corporation’s Consolidated Financial Statements include the Consolidated Statement of Comprehensive Income as a result of adopting this standard.

In July 2012, the FASB issued ASU No. 2012-02 (“ASU 2012-02”), “Testing Indefinite-Lived Intangible Assets for Impairment.” ASU 2012-02 gives entities an option to first assess qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that the indefinite-lived intangible asset is impaired. If based on its qualitative assessment an entity concludes that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. ASU 2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Corporation does not expect that the adoption of this standard will have a material effect on its financial statements.

Note 4—Acquisition

During the first quarter of 2013, the Corporation acquired all of the outstanding senior secured debt of Clinton Cards for $56.6 million (£35 million) through Lakeshore Lending Limited (“Lakeshore”), a wholly-owned subsidiary of the Corporation organized under the laws of the United Kingdom. Subsequently, on May 9, 2012, Clinton Cards was placed into administration, a procedure similar to Chapter 11 bankruptcy in the United States. Prior to entering into administration, Clinton Cards had approximately 750 stores and annual revenues of approximately $600 million across its two primary retail brands, Clinton Cards and Birthdays. The legacy Clinton Cards business had been an important customer to the Corporation’s international business for approximately forty years and was one of the Corporation’s largest customers.

As part of the administration process, the administrators (“Administrators”) of Clinton Cards and certain of its subsidiaries (the “Sellers”) conducted an auction of certain assets of the business of the Sellers that they believed constituted a viable ongoing business. Lakeshore bid $37.2 million (£23 million) for certain of these remaining

9

assets. The bid took the form of a “credit bid,” where the Corporation used a portion of the outstanding senior secured debt owed to Lakeshore by Clinton Cards to pay the purchase price for the assets. The bid was accepted by the Administrators and on June 6, 2012, through its wholly-owned subsidiaries, UK Greetings Limited and Lakeshore, the Corporation entered into an agreement with the Sellers and the Administrators for the purchase of certain assets and the related business of the Sellers.

Under the terms of the agreement, the Corporation expects to acquire approximately 400 stores from the Sellers, together with related inventory and overhead, as well as the Clinton Cards and related brands. The Corporation will operate the acquired stores through a subsidiary of Lakeshore, AG Retail Cards Limited. The asset acquisition is expected to result in a net increase in the Corporation’s annual revenues of approximately $265 million, although the final number will depend on the ultimate number of stores acquired, which is subject to further negotiations with landlords at each respective location. The landlords must generally consent to the assignment of the leases for such stores on terms that are acceptable to the Corporation. If the Corporation cannot negotiate acceptable lease assignments, or if the applicable landlord withholds consent to the assignment of its store lease, then the Corporation may close the store, the store lease will be placed back into the administration process, and the Sellers will be responsible for any further obligations under the store lease. Based on current negotiations, as of November 23, 2012, the Corporation has completed 185 lease assignments. Assuming that the remaining landlords consent to terms proposed by the Corporation and the Corporation is able to successfully complete assignment for all of the approximately 400 stores, as of November 23, 2012, we anticipate the estimated future minimum rental payments for noncancelable operating leases related to acquired stores will be approximately $367 million.

The stores and assets not acquired by the Corporation remain part of the administration process. It is anticipated that these remaining assets not purchased by the Corporation will be liquidated and proceeds will be used to repay the creditors of the Sellers, including the Corporation. The Corporation will seek to recover the $19.4 million (£12 million) remaining senior secured debt claim held by it through the liquidation process. However, based on the estimated recovery information provided by the Administrators, the Corporation recorded an aggregate charge of $10.0 million, $7.8 million in the first quarter and $2.2 million in the second quarter, relating to the senior secured debt it acquired in the current year’s first fiscal quarter. The remaining balance of the senior secured debt, totaling approximately $9 million is included in “Prepaid expenses and other” on the Consolidated Statement of Financial Position. The liquidation process and the negotiations with landlords for stores included in the aforementioned acquisition, is expected to take approximately twelve months from the closing of the transaction on June 6, 2012.

Separate from the acquired senior secured debt, the Corporation had unsecured accounts receivable exposure to Clinton Cards. Based on the expected recovery shortfall on the senior secured debt described above, a majority of the unsecured accounts receivable is not expected to be collected. Accordingly, the Corporation recorded bad debt expense of $17.2 million relating to the unsecured accounts receivable. In addition, with the May 2012 announcement by the Administrators that all of Clinton Cards’ Birthdays branded retail stores would be liquidated, the Corporation recorded an impairment charge of $4.0 million for the deferred costs related to the Birthdays stores.

The charges incurred in the nine months ended November 23, 2012 associated with the aforementioned acquisition that do not have comparative amounts in the prior year nine month period are reflected on the Consolidated Statement of Operations as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
Net sales	$	4.0	$	—	$	—	$	—	$	4.0
Administrative and general expenses		—		17.2		6.3		—		23.5
Other non-operating (income) expense		—		—		—		10.0		10.0
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

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These charges are reflected in the Corporation’s reportable segments as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
International Social Expression Products	$	4.0	$	17.2	$	—	$	—	$	21.2
Unallocated		—		—		6.3		10.0		16.3
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

The total cost of the acquisition has been allocated to the assets acquired and the liabilities assumed based upon their estimated fair values at the date of the acquisition. The estimated purchase price allocation is preliminary and subject to revision as valuation work and other analyses are still being conducted. The following represents the preliminary purchase price allocation:

Purchase price (in millions):
Credit bid	$	37.2
Effective settlement of pre-existing supply agreement with the legacy Clinton Cards business		6.2
Cash acquired		(0.6	)
	$	42.8
Allocation (in millions):
Inventory	$	16.2
Property, plant and equipment		20.0
Intangible assets		7.1
Current liabilities assumed		(0.5	)
	$	42.8

The financial results of this acquisition are included in the Corporation’s consolidated results from the date of acquisition. Pro forma results of operations have not been presented because the effect of this acquisition was not deemed material at the date of acquisition. The acquired business is included in the Corporation’s Retail Operations segment.

Note 5—Royalty Revenue and Related Expenses

The Corporation has agreements for licensing the Care Bears and Strawberry Shortcake characters and other intellectual property. These license agreements provide for royalty revenue to the Corporation, which is recorded in “Other revenue” on the Consolidated Statement of Operations. These license agreements may include the receipt of upfront advances, which are recorded as deferred revenue and earned during the period of the agreement. Expenses associated with the servicing of these agreements, primarily relating to the licensing activities included in non-reportable segments, are summarized as follows:

	Three Months Ended				Nine Months Ended
(In thousands)	November 23, 2012		November 25, 2011		November 23, 2012		November 25, 2011
Royalty revenue	$	7,085	$	6,401	$	17,947	$	20,785
Royalty expenses
Material, labor and other production costs	$	2,794	$	2,789	$	7,795	$	7,781
Selling, distribution and marketing expenses		1,856		2,621		5,235		7,345
Administrative and general expenses		467		431		1,330		1,292
	$	5,117	$	5,841	$	14,360	$	16,418

In addition to the expenses disclosed above, the Corporation incurred charges of $2.1 million associated with its licensing business, which is included in “Other operating income – net” on the Consolidated Statement of Operations. See Note 6 for further information.

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Note 6—Other Income and Expense

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of intellectual properties	$	—		$	—		$	—		$	(4,500	)
Termination of certain agency agreements		—			—			2,125			—
Miscellaneous		(2,217	)		(813	)		(3,546	)		(2,358	)
Other operating income – net	$	(2,217	)	$	(813	)	$	(1,421	)	$	(6,858	)

In May 2012, the Corporation recorded expenses totaling $2.1 million related to the termination of certain agency agreements associated with its licensing business.

In June 2011, the Corporation sold certain minor character properties and recognized a gain of $4.5 million. The proceeds of $4.5 million were included in “Proceeds from sale of intellectual properties” on the Consolidated Statement of Cash Flows.

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of Party City investment	$	(1,141	)	$	—		$	(4,293	)	$	—
Loss on Clinton Cards debt		—			—			10,043			—
Foreign exchange gain		(552	)		(1,500	)		(948	)		(631	)
Rental income		(450	)		(238	)		(1,496	)		(977	)
Loss (gain) on asset disposal		240			(323	)		394			(807	)
Miscellaneous		(1	)		(16	)		(177	)		(206	)
Other non-operating (income) expense – net	$	(1,904	)	$	(2,077	)	$	3,523		$	(2,621	)

“Miscellaneous” includes, among other things, income/loss from debt and equity securities.

During the nine months ended November 23, 2012, the Corporation recorded a gain of $4.3 million associated with the sale of a portion of its investment in Party City, including $1.1 million and $3.2 million in the three months ended November 23, 2012 and August 24, 2012, respectively. See Note 1 for further information.

The Corporation also recorded a loss of $10.0 million during the nine months ended November 23, 2012 related to the senior secured debt of Clinton Cards that the Corporation acquired during the first quarter, including $7.8 million and $2.2 million in the three months ended May 25, 2012 and August 24, 2012, respectively. See Note 4 for further information.

In October 2011, the Corporation sold the land and buildings relating to its party goods product lines in the North American Social Expression Products segment that were previously included in “Assets held for sale” on the Consolidated Statement of Financial Position and recorded a gain of approximately $0.4 million. The cash proceeds of approximately $6.0 million received from the sale of the assets are included in “Proceeds from sale of fixed assets” on the Consolidated Statement of Cash Flows.

In June 2011, the Corporation sold the land, building and certain equipment associated with a distribution facility in the International Social Expression Products segment that were previously included in “Assets held for sale” on the Consolidated Statement of Financial Position and recorded a gain of approximately $0.5 million. The cash proceeds of approximately $2.4 million received from the sale of the assets are included in “Proceeds from sale of fixed assets” on the Consolidated Statement of Cash Flows.

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Note 7—(Loss) Earnings Per Share

The following table sets forth the computation of (loss) earnings per share and (loss) earnings per share—assuming dilution:

	Three Months Ended					Nine Months Ended
	November 23, 2012			November 25, 2011		November 23, 2012		November 25, 2011
Numerator (in thousands):
Net (loss) income	$	(809	)	$	20,246	$	2,187	$	67,315
Denominator (in thousands):
Weighted average shares outstanding		31,877			39,481		33,712		40,226
Effect of dilutive securities:
Stock options and awards		—			956		767		1,155
Weighted average shares outstanding – assuming dilution		31,877			40,437		34,479		41,381
(Loss) earnings per share	$	(0.03	)	$	0.51	$	0.06	$	1.67
(Loss) earnings per share – assuming dilution	$	(0.03	)	$	0.50	$	0.06	$	1.63

Certain stock options were excluded from the computation of earnings per share-assuming dilution, as the effect would have been antidilutive due to the net loss in the period. The stock options excluded from the computation of earnings per share-assuming dilution were approximately 3.7 million in both the three and nine month periods ended November 23, 2012 (3.7 million and 2.4 million in the three and nine month periods ended November 25, 2011, respectively) because the options’ exercise prices were greater than the average price of the common shares.

There were an insignificant number of Class A common shares issued upon exercise of employee stock options and vesting of equity awards during the three months ended November 23, 2012 (0.1 million Class A common shares during the three months ended November 25, 2011). There were no Class B common shares issued upon exercise of employee stock options and vesting of equity awards during the three months ended November 23, 2012. The Corporation issued approximately 0.2 million Class A common shares and an insignificant number of Class B common shares upon exercise of employee stock options and vesting of equity awards during the nine months ended November 23, 2012 (0.7 million and 0.3 million Class A and Class B common shares, respectively, during the nine months ended November 25, 2011).

Note 8—Customer Allowances and Discounts

Trade accounts receivable is reported net of certain allowances and discounts. The most significant of these are as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Allowance for seasonal sales returns	$	35,506	$	34,285	$	47,496
Allowance for outdated products		11,850		10,976		9,937
Allowance for doubtful accounts		5,670		4,480		7,031
Allowance for marketing funds		29,599		26,679		29,710
Allowance for rebates		30,012		27,648		28,465
	$	112,637	$	104,068	$	122,639

Certain customer allowances and discounts are settled in cash. These accounts, primarily rebates, which are classified as “Accrued liabilities” on the Consolidated Statement of Financial Position, totaled $14.0 million, $13.7 million and $13.3 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

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Note 9—Inventories

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Raw materials	$	18,803	$	17,565	$	16,912
Work in process		7,051		9,452		8,294
Finished products		302,101		242,767		251,213
		327,955		269,784		276,419
Less LIFO reserve		82,976		81,077		81,515
		244,979		188,707		194,904
Display materials and factory supplies		19,351		20,238		19,508
	$	264,330	$	208,945	$	214,412

The valuation of inventory under the Last-In, First-Out (“LIFO”) method is made at the end of each fiscal year based on inventory levels and costs at that time. Accordingly, interim LIFO calculations, by necessity, are based on estimates of expected fiscal year-end inventory levels and costs, and are subject to final fiscal year-end LIFO inventory calculations.

Inventory held on location for retailers with scan-based trading arrangements, which is included in finished products, totaled $72.5 million, $52.0 million and $61.5 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

Note 10—Deferred Costs

Deferred costs and future payment commitments for retail supply agreements are included in the following financial statement captions:

(In thousands)	November 23, 2012			February 29, 2012			November 25, 2011
Prepaid expenses and other	$	98,211		$	94,071		$	93,553
Other assets		346,056			395,397			307,611
Deferred cost assets		444,267			489,468			401,164
Other current liabilities		(43,654	)		(45,891	)		(58,950	)
Other liabilities		(124,353	)		(137,360	)		(64,154	)
Deferred cost liabilities		(168,007	)		(183,251	)		(123,104	)
Net deferred costs	$	276,260		$	306,217		$	278,060

The Corporation maintains an allowance for deferred costs related to supply agreements of $7.8 million, $10.0 million and $10.0 million at November 23, 2012, February 29, 2012 and November 25, 2011, respectively. This allowance is included in “Other assets” in the Consolidated Statement of Financial Position.

Note 11—Debt

As of November 23, 2012, the Corporation had a $400 million revolving credit facility, which expires in June 2015, and an accounts receivable facility that provides funding of up to $50 million. During the current quarter, on September 21, 2012, the accounts receivable facility was amended to decrease the amount of available financing thereunder from $70 million to $50 million. Also, on September 21, 2012, the liquidity commitments under the accounts receivable facility were renewed for an additional year and the facility’s term was extended an additional three years from September 21, 2012 to October 1, 2015. As of November 23, 2012, there was $131.7 million outstanding under the Corporation’s revolving credit facility, bearing interest at a rate of approximately 1.5%. There were no balances outstanding under the Corporation’s accounts receivable facility at November 23, 2012. The Corporation had, in the aggregate, $30.6 million outstanding under letters of credit under these borrowing agreements, which reduces the total credit available to the Corporation thereunder.

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There were no balances outstanding under the Corporation’s revolving credit facility or accounts receivable facility at February 29, 2012 and November 25, 2011, respectively.

Long-term debt and their related calendar year due dates, net of unamortized discounts, which were zero as of November 23, 2012 and February 29, 2012, respectively, and $20.2 million as of November 25, 2011, were as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
7.375% senior notes, due 2021	$	225,000	$	225,000	$	—
Revolving credit facility, due 2015		131,651		—		—
7.375% senior notes, due 2016		—		—		213,864
7.375% notes, due 2016		—		—		20,597
6.10% senior notes, due 2028		181		181		181
	$	356,832	$	225,181	$	234,642

The total fair value of the Corporation’s publicly traded debt, which was considered a Level 1 valuation as it was based on quoted market prices, was $241.9 million (at a carrying value of $225.2 million), $239.6 million (at a carrying value of $225.2 million) and $243.6 million (at a carrying value of $234.6 million) at November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

The total fair value of the Corporation’s non-publicly traded debt, which was considered a Level 2 valuation as it was based on comparable privately traded debt prices, was $131.7 million (at a carrying value of $131.7 million) at November 23, 2012.

On December 19, 2012, the Corporation amended its credit agreement to modify the definition of Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) to permit, as of November 23, 2012, certain add-backs related to specific non-recurring expenses related to the Clinton Cards acquisition. At November 23, 2012, the Corporation was in compliance with the financial covenants under its borrowing agreements, as amended.

Note 12—Retirement Benefits

The components of periodic benefit cost for the Corporation’s defined benefit pension and postretirement benefit plans are as follows:

	Defined Benefit Pension
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	386		$	206		$	1,053		$	621
Interest cost		1,864			2,127			5,547			6,418
Expected return on plan assets		(1,632	)		(1,655	)		(4,854	)		(4,998	)
Amortization of prior service cost		61			61			184			184
Amortization of actuarial loss		1,005			557			2,636			1,684
	$	1,684		$	1,296		$	4,566		$	3,909

	Postretirement Benefit
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	88		$	363		$	513		$	1,088
Interest cost		531			1,210			2,131			3,630
Expected return on plan assets		(893	)		(1,098	)		(2,573	)		(3,293	)
Amortization of prior service credit		(519	)		(638	)		(1,557	)		(1,913	)
Amortization of actuarial gain		(339	)		—			(339	)		—
	$	(1,132	)	$	(163	)	$	(1,825	)	$	(488	)

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The Corporation has a discretionary profit-sharing plan with a 401(k) provision covering most of its United States employees. The profit-sharing plan expense for the nine months ended November 23, 2012 was $3.9 million, compared to $6.3 million in the prior year period. The Corporation also matches a portion of 401(k) employee contributions. The expenses recognized for the three and nine month periods ended November 23, 2012 were $2.3 million and $4.9 million ($1.9 million and $4.5 million for the three and nine month periods ended November 25, 2011), respectively. The profit-sharing plan and 401(k) matching expenses for the nine month periods are estimates as actual contributions are determined after fiscal year-end.

At November 23, 2012, February 29, 2012 and November 25, 2011, the liability for postretirement benefits other than pensions was $28.6 million, $24.8 million and $29.9 million, respectively, and is included in “Other liabilities” on the Consolidated Statement of Financial Position. At November 23, 2012, February 29, 2012 and November 25, 2011, the long-term liability for pension benefits was $75.7 million, $75.7 million and $59.8 million, respectively, and is included in “Other liabilities” on the Consolidated Statement of Financial Position.

Note 13—Fair Value Measurements

Assets and liabilities measured at fair value are classified using the fair value hierarchy based upon the transparency of inputs as of the measurement date. The classification of fair value measurements within the hierarchy is based upon the lowest level of input that is significant to the measurement. The three levels are defined as follows:

• Level 1 – Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2 – Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

• Level 3 – Valuation is based upon unobservable inputs that are significant to the fair value measurement.

The following table summarizes the financial assets measured at fair value as of November 23, 2012:

	November 23, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	10,177	$	10,177	$	—	$	—

The following table summarizes the financial assets measured at fair value as of February 29, 2012:

	February 29, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	9,198	$	9,198	$	—	$	—

The following table summarizes the financial assets measured at fair value as of November 25, 2011:

	November 25, 2011		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Active employees’ medical plan trust assets	$	3,312	$	3,312	$	—	$	—
Deferred compensation plan assets (1)		8,719		8,719		—		—
Total	$	12,031	$	12,031	$	—	$	—

(1) There is an offsetting liability for the obligation to its employees on the Corporation’s books.

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As of February 29, 2012, the active employees’ medical plan trust was terminated. During the prior year, the fair value of the investments in the active employees’ medical plan trust was considered a Level 1 valuation as it was based on the quoted market value per share of each individual security investment in an active market.

The deferred compensation plan includes mutual fund assets. Assets held in mutual funds were recorded at fair value, which was considered a Level 1 valuation as it is based on each fund’s quoted market value per share in an active market. The fair value of the related non-qualified deferred compensation liability is based on the fair value of the mutual fund and the Corporation is under no obligation to fund employees’ nonqualified accounts.

Note 14—Contingency

The Corporation is presently involved in various judicial, administrative, regulatory and arbitration proceedings concerning matters arising in the ordinary course of business, including but not limited to, employment, commercial disputes and other contractual matters, some of which are described below. These matters are inherently subject to many uncertainties regarding the possibility of a loss to the Corporation. These uncertainties will ultimately be resolved when one or more future events occur or fail to occur, confirming the incurrence of a liability or reduction of a liability. In accordance with ASC Topic 450, “Contingencies,” the Corporation accrues for these contingencies by a charge to income when it is both probable that one or more future events will occur confirming the fact of a loss and the amount of the loss can be reasonably estimated. Due to this uncertainty, the actual amount of any loss may ultimately prove to be larger or smaller than the amounts reflected in the Corporation’s Consolidated Financial Statements. Some of these proceedings are at preliminary stages and some of these cases seek an indeterminate amount of damages.

Baker/Collier Litigation. American Greetings Corporation is a defendant in two putative class action lawsuits involving corporate-owned life insurance policies (the “Insurance Policies”): one filed in the Northern District of Ohio on January 11, 2012 by Theresa Baker as the personal representative of the estate of Richard Charles Wolfe (the “Baker Litigation”); and the other filed in the Northern District of Oklahoma on October 1, 2010 by Keith Collier as the personal representative of the estate of Ruthie Collier (the “Collier Litigation”).

In the Baker Litigation, the plaintiff claims that American Greetings Corporation (1) misappropriated its employees’ names and identities to benefit itself; (2) breached its fiduciary duty by using its employees’ identities and personal information to benefit itself; (3) unjustly enriched itself through the receipt of corporate-owned life insurance policy benefits, interest and investment returns; and (4) improperly received insurance policy benefits for the insurable interest in Mr. Wolfe’s life. The plaintiff seeks damages in the amount of all pecuniary benefits associated with the subject Insurance Policies, including investment returns, interest and life insurance policy benefits that American Greetings Corporation received from the deaths of the former employees whose estates form the putative class. The plaintiff also seeks punitive damages, pre- and post-judgment interest, costs and attorney’s fees. On April 30, 2012, American Greetings Corporation filed a Motion to Dismiss the Plaintiff’s Complaint. Shortly thereafter, the plaintiff filed a Motion for Class Certification. The court stayed the plaintiff’s Motion for Class Certification until the Motion to Dismiss was decided. On September 19, 2012, the Ohio federal court ordered the Baker plaintiff to file an amended complaint and then denied without prejudice the Corporation’s Motion to Dismiss the Baker Litigation as moot. On October 1, 2012, the plaintiff filed a Second Amended Complaint. On October 18, 2012, American Greetings Corporation filed its Motion to Dismiss the Second Amended Complaint. Class certification has not been decided in either of these cases.

In the Collier Litigation, the plaintiff claims that American Greetings Corporation did not have an insurable interest when it obtained the subject Insurance Policies and wrongfully received the benefits from those policies. The plaintiff seeks damages in the amount of policy benefits received by American Greetings Corporation from the subject Insurance Policies, as well as attorney’s fees and costs and interest. On April 2, 2012, the plaintiff filed its First Amended Complaint, adding misappropriation of employee information and breach of fiduciary duty claims as well as seeking punitive damages. On April 20, 2012, American Greetings Corporation filed a Motion to Transfer the case to the Ohio federal court. On July 6, 2012, the court granted the Corporation’s Motion to Transfer and transferred the case to the Northern District of Ohio, where the Baker Litigation is pending.

As requested by the court, the parties filed a joint proposed scheduling order on October 29, 2012, setting the Collier and Baker Litigations on parallel procedural tracks. On January 2, 2013, the parties filed a Joint Motion to Stay the Collier and Baker Litigations for 60 days to allow the parties to engage in private mediation. The same law firm represents the individual plaintiffs in the Collier and Baker matters.

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Cookie Jar/MoonScoop Litigation. As previously disclosed, on May 6, 2009, American Greetings Corporation and its subsidiary, Those Characters From Cleveland, Inc. (“TCFC”), filed an action in the Cuyahoga County (Ohio) Court of Common Pleas against Cookie Jar Entertainment Inc. (“Cookie Jar”) and its affiliates, Cookie Jar Entertainment (USA) Inc. (formerly known as DIC Entertainment Corporation) (“DIC”) and Cookie Jar Entertainment Holdings (USA) Inc. (formerly known as DIC Entertainment Holdings, Inc.) relating to the July 20, 2008 Binding Letter Agreement between American Greetings Corporation and Cookie Jar (the “Cookie Jar Agreement”) for the sale of the Strawberry Shortcake and Care Bears properties (the “Properties”). On May 7, 2009, Cookie Jar removed the case to the United States District Court for the Northern District of Ohio. Simultaneously, Cookie Jar filed an action against American Greetings Corporation, TCFC, Mike Young Productions, LLC (“Mike Young Productions”) and MoonScoop SAS (“MoonScoop”) in the Supreme Court of the State of New York, County of New York. Mike Young Productions and MoonScoop were named as defendants in the action in connection with the binding term sheet between American Greetings Corporation and MoonScoop dated March 24, 2009 (the “MoonScoop Binding Agreement”), providing for the sale to MoonScoop of the Properties.

On May 7, 2010, the legal proceedings involving American Greetings Corporation, TCFC, Cookie Jar and DIC were settled, without a payment to any of the parties. As part of the settlement, on May 7, 2010, the Cookie Jar Agreement was amended to, among other things, terminate American Greetings Corporation’s obligation to sell to Cookie Jar, and Cookie Jar’s obligation to purchase, the Properties. As part of the settlement, Cookie Jar Entertainment (USA) Inc. continued to represent the Strawberry Shortcake property on behalf of American Greetings Corporation and become an international agent for the Care Bears property. On May 19, 2010, the Northern District of Ohio court granted the parties’ joint motion to dismiss all claims and counterclaims without prejudice.

On August 11, 2009, MoonScoop filed an action against American Greetings Corporation and TCFC in the United States District Court for the Northern District of Ohio, alleging breach of contract and promissory estoppel relating to the MoonScoop Binding Agreement. On MoonScoop’s request, the court agreed to consolidate this lawsuit with the first Ohio lawsuit (described above) for all pretrial purposes. The parties filed motions for summary judgment on various claims. On April 27, 2010, the court granted American Greetings Corporation’s and TCFC’s motion for summary judgment on MoonScoop’s breach of contract and promissory estoppel claims, dismissing these claims with prejudice. On the same day, the court also ruled that American Greetings Corporation must indemnify MoonScoop against Cookie Jar’s claims in this lawsuit. On May 21, 2010, MoonScoop appealed the court’s summary judgment ruling to the United States Court of Appeals for the Sixth Circuit. On June 4, 2010, American Greetings Corporation and TCFC appealed to the United States Court of Appeals for the Sixth Circuit the court’s ruling that it must indemnify MoonScoop against the cross claims asserted against it.

On July 16, 2012, the U.S. Sixth Circuit Court of Appeals reversed the Northern District of Ohio’s order that had granted American Greetings Corporation’s summary judgment on MoonScoop’s principal claims. The case has been remanded to the District Court for further proceedings. The Court of Appeals also affirmed the District Court’s finding on summary judgment in favor of MoonScoop on its indemnity claim, involving MoonScoop’s attorney fees for defending against Cookie Jar’s third-party claims (which have been dismissed). As a result, the Corporation has reimbursed MoonScoop for the $161,309 in attorney fees that it incurred. The District Court trial began on November 13, 2012. The jury returned a unanimous verdict in favor of American Greetings Corporation and TCFC. On November 26, 2012, the District Court entered judgment in favor of American Greetings Corporation and against MoonScoop. On December 20, 2012, MoonScoop appealed the verdict to the United States Court of Appeals for the Sixth Circuit.

Carter/Wolfe/LMPERS Litigation. On September 26, 2012, the Corporation announced that the Board of Directors had received a non-binding proposal (the “Going Private Proposal”) dated September 25, 2012 from Zev Weiss, our Chief Executive Officer, and Jeffrey Weiss, our President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties, to acquire all of the outstanding Class A and Class B common shares not currently owned by them for $17.18 per share. On September 27, 2012, Dolores Carter, a purported shareholder, filed a putative class action and shareholder derivative lawsuit in the Court of Common Pleas in Cuyahoga County, Ohio, against American Greetings Corporation and all of the members of its Board of Directors, alleging that the directors breached their fiduciary duties in evaluating the Going Private Proposal and seeking declaratory relief. Subsequently, eight more lawsuits were filed in Cuyahoga County state court against American Greetings Corporation and its Board of Directors. One lawsuit was voluntarily dismissed. The remaining lawsuits were consolidated and remain pending with the commercial docket in Cuyahoga County court. On December 6, 2012, the court appointed the lead plaintiff and lead plaintiff’s counsel.

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On November 6, 2012, R. David Wolfe, a purported shareholder, filed a putative class action in the United States District Court for the Northern District of Ohio against American Greetings Corporation, certain members of the Weiss family, the Irving I. Stone Oversight Trust, Irving Stone Limited Liability Company, Irving I. Stone Support Foundation and Irving I. Stone Foundation, alleging breach of fiduciary duties against certain Weiss defendants by proposing and pursuing the Going Private Proposal (the “Wolfe Litigation”) and seeking declaratory relief. Shortly thereafter, on November 9, 2012, the Louisiana Municipal Police Employees’ Retirement System filed a similar, purported class action against the same defendants as the Wolfe Litigation, also alleging breach of fiduciary duties against certain Weiss defendants and seeking declaratory relief (the “LMPERS Litigation”).

On November 30, 2012, the Wolfe Litigation plaintiff filed Motions to (1) Consolidate the Wolfe and LMPERS Litigations; (2) for Appointment as Co-lead Plaintiff; (3) for Appointment as Co-Lead Plaintiff’s Counsel, and (4) for Partial Summary Judgment. On December 14, 2012, the Corporation filed its Oppositions to the Motions (a) to Consolidate the Wolfe and LMPERS Litigation, (b) for Appointment as Co-Lead Plaintiff and (c) for Appointment as Co-Lead Plaintiff’s Counsel. On the same day, American Greetings Corporation also filed a Motion to Dismiss the action.

Management is unable to estimate a range of reasonably possible losses for these cases in which the damages have not been specified and (i) the proceedings are in the early stages, (ii) there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class, (iii) there is uncertainty as to the outcome of the pending appeals or motions, (iv) there are significant factual issues to be resolved, and/or (v) there are novel legal issues presented. However, for these cases, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material adverse effect on the Corporation’s financial condition, though the outcomes could be material to the Corporation’s operating results for any particular period, depending, in part, upon the operating results for such period.

Note 15—Income Taxes

The Corporation’s provision for income taxes in interim periods is computed by applying its estimated annual effective tax rate against income (loss) before income tax expense (benefit) for the period. In addition, non-recurring or discrete items are recorded during the period in which they occur. The magnitude of the impact that discrete items have on the Corporation’s quarterly effective tax rate is dependent on the level of income in the period. The effective tax rate was 61.5% and 2.8% for the three and nine months ended November 23, 2012, respectively, and 31.8% and 36.2% for the three and nine months ended November 25, 2011, respectively. The lower than statutory rate for the nine months ended November 23, 2012 is due primarily to the release of reserves upon lapse of the applicable statutes and lower taxable income.

At November 23, 2012, the Corporation had unrecognized tax benefits of $27.4 million that, if recognized, would have a favorable effect on the Corporation’s income tax expense of $17.1 million. During 2013, the Corporation’s unrecognized tax benefits decreased approximately $3 million, of which approximately $1 million relates to the release of reserves upon the lapse of applicable statutes, approximately $1 million relates to payments to various U.S. state and local jurisdictions to settle certain open years which were under examination and approximately $1 million relates to a decrease in estimated accruals and settlements related to open years under federal and state examination. It is reasonably possible that the Corporation’s unrecognized tax positions as of November 23, 2012 could decrease approximately $9 million during the next twelve months due to anticipated settlements and resulting cash payments related to open years after 1996, which are currently under examination.

The Corporation recognizes interest and penalties accrued on unrecognized tax benefits and refundable income taxes as a component of income tax expense. During the nine months ended November 23, 2012, the Corporation recognized net expense of $0.3 million for interest and penalties on unrecognized tax benefits and refundable income taxes. As of November 23, 2012, the total amount of gross accrued interest and penalties related to unrecognized tax benefits less refundable income taxes was a net payable of $8.2 million.

The Corporation is subject to examination by the Internal Revenue Service for tax years 2006 to the present and various U.S. state and local jurisdictions for tax years 1996 to the present. The Corporation is also subject to tax examination in various international tax jurisdictions, including Canada, the United Kingdom, Australia, Italy, Mexico and New Zealand for tax years 2006 to the present.

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Note 16—Business Segment Information

The Corporation has North American Social Expression Products, International Social Expression Products, Retail Operations, AG Interactive and non-reportable segments. The North American Social Expression Products and International Social Expression Products segments primarily design, manufacture and sell greeting cards and other related products through various channels of distribution with mass merchandise retailers as the primary channel. At November 23, 2012, the Corporation operated approximately 400 card and gift retail stores in the United Kingdom through its Retail Operations segment. The stores sell products purchased from the International Social Expression Products segment as well as products purchased from other vendors. AG Interactive distributes social expression products, including electronic greetings and a broad range of graphics and digital services and products, through a variety of electronic channels, including Web sites, Internet portals, instant messaging services and electronic mobile devices. The Corporation’s non-reportable operating segments primarily include licensing activities and the design, manufacture and sale of display fixtures.

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Total Revenue:
North American Social Expression Products	$	333,852		$	333,305		$	908,267		$	902,333
International Social Expression Products		101,972			103,352			239,486			249,448
Intersegment items		(25,538	)		—			(39,080	)		—
Net		76,434			103,352			200,406			249,448
Retail Operations		67,635			—			107,519			—
AG Interactive		15,982			16,878			47,255			49,664
Non-reportable segments		12,911			11,472			30,309			37,452
	$	506,814		$	465,007		$	1,293,756		$	1,238,897
Segment (Loss) Earnings:
North American Social Expression Products	$	22,099		$	28,016		$	98,757		$	113,009
International Social Expression Products		3,413			9,537			(18,855	)		15,308
Intersegment items		(4,123	)		—			(11,525	)		—
Net		(710	)		9,537			(30,380	)		15,308
Retail Operations		(11,473	)		—			(16,579	)		—
AG Interactive		5,331			3,737			13,713			10,970
Non-reportable segments		3,259			2,368			5,501			17,467
Unallocated
Interest expense		(4,504	)		(5,853	)		(13,314	)		(17,708	)
Profit-sharing plan expense		(423	)		(1,078	)		(3,852	)		(6,308	)
Stock-based compensation expense		(2,965	)		(2,676	)		(7,806	)		(8,038	)
Corporate overhead expense		(12,713	)		(4,351	)		(43,790	)		(19,257	)
		(20,605	)		(13,958	)		(68,762	)		(51,311	)
	$	(2,099	)	$	29,700		$	2,250		$	105,443

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Consolidated operating results include the operating results of the Retail Operations segment from the acquisition date of June 6, 2012 until October 27, 2012, the end of the segment’s third fiscal quarter.

“Corporate overhead expense” includes costs associated with corporate operations including, among other costs, senior management, corporate finance, legal and insurance programs.

See Note 4 for segment information related to certain charges associated with activities and transactions in connection with Clinton Cards that do not have comparative amounts in the prior year.

Termination Benefits

Termination benefits are primarily considered part of an ongoing benefit arrangement, accounted for in accordance with ASC Topic 712, “Compensation – Nonretirement Postemployment Benefits,” and are recorded when payment of the benefits is probable and can be reasonably estimated.

The balance of the severance accrual was $4.7 million, $6.8 million and $3.8 million at November 23, 2012, February 29, 2012 and November 25, 2011, respectively. The payments expected within the next twelve months are included in “Accrued liabilities” while the remaining payments beyond the next twelve months are included in “Other liabilities” on the Consolidated Statement of Financial Position.

Note 17—Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation

On September 26, 2012, the Corporation announced that its Board of Directors received the non-binding Going Private Proposal from Zev Weiss, its Chief Executive Officer, and Jeffrey Weiss, its President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties to acquire all of the outstanding Class A and Class B common shares of the Corporation not currently owned by them for $17.18 per share in cash. The Corporation’s Board of Directors has formed a special committee of independent directors (the "Special Committee") to, among other things, consider the Going Private Proposal. The Special Committee is also authorized to review and evaluate other options available to the Corporation, and has retained its own financial advisor as well as legal counsel. Since the announcement of the Going Private Proposal, a number of lawsuits have been filed against the Corporation in State and Federal court. See Note 14 for further information concerning these lawsuits.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited consolidated financial statements. This discussion and analysis, and other statements made in this Report, contain forward-looking statements, see “Factors That May Affect Future Results” at the end of this discussion and analysis for a description of the uncertainties, risks and assumptions associated with these statements. Unless otherwise indicated or the context otherwise requires, the “Corporation,” “we,” “our,” “us” and “American Greetings” are used in this Report to refer to the businesses of American Greetings Corporation and its consolidated subsidiaries.

Overview

Acquisition

Our operating results for the three and nine months ended November 23, 2012 were significantly affected by certain activities and transactions related to Clinton Cards PLC (“Clinton Cards”). Clinton Cards, one of the largest specialty retailers of greeting cards in the United Kingdom (also referred to herein as “UK”), had been an important customer to our international business for approximately forty years and was one of our largest customers. The Clinton Cards business had been struggling and in an effort to protect our interests and work more closely with all involved parties, on May 9, 2012, we acquired all of Clinton Cards’ outstanding senior secured debt for $56.6 million. Clinton Cards was subsequently placed into administration, a procedure similar to Chapter 11 bankruptcy in the United States. As part of the administration process, an auction of the assets of the Clinton Cards business was conducted. We participated in the auction process and bid $37.2 million for certain of the assets. The bid took the form of a “credit bid,” where we used a portion of the outstanding senior secured debt owed to us by Clinton Cards to pay the purchase price for the assets.

Our bid was accepted on June 6, 2012, and we expect to acquire approximately 400 stores, together with the related inventory and overhead, as well as the Clinton Cards and related brands. We anticipate operating the acquired stores under the “Clintons” brand. The final number of stores acquired will depend on negotiations with landlords at each respective location, who must generally consent to the assignment of the leases for such stores on terms that are acceptable to us. If we cannot negotiate acceptable lease assignments or if the applicable landlord withholds consent to the assignment of its store lease, then we may close the store and the store lease will be placed back into the administration process. Based on current contracts and negotiations, as of November 23, 2012, we have completed 185 lease assignments. Assuming that the remaining landlords consent to terms proposed by us and we are able to successfully complete assignments for all of the approximately 400 stores, as of November 23, 2012, we anticipate the estimated future minimum rental payments for noncancelable operating leases related to acquired stores will be approximately $367 million. It is anticipated that the remaining assets not purchased by us will be liquidated and proceeds will be used to repay the creditors of Clinton Cards, including us as both the only senior secured lender and the largest unsecured lender. We will seek to recover our $19.4 million remaining senior secured debt claim through the liquidation process. However, based on the estimated recovery information provided by the administrators, we recorded an aggregate charge of $10.0 million in the first half of fiscal 2013 relating to the senior secured debt we acquired in the first quarter. Both the liquidation process and the negotiations with landlords are expected to take approximately twelve months from the closing of the transaction, June 6, 2012.

Separate from the acquired senior secured debt, prior to the acquisition, we had unsecured accounts receivable exposure to Clinton Cards. Based on the expected recovery shortfall on the senior secured debt noted above, a majority of the unsecured accounts receivable is not expected to be collected. Accordingly, we recorded bad debt expense of $17.2 million relating to the unsecured accounts receivable in the first quarter. In addition, with the May 2012 announcement by the administrators that all of Clinton Cards’ Birthdays branded retail stores would be liquidated during the first quarter of fiscal 2013, we recorded an impairment charge of approximately $4.0 million for the deferred costs related to our supply agreement associated with the Birthdays stores. We have also incurred approximately $6.3 million of transaction costs related to the Clinton Cards acquisition. There were no significant items related to the Clinton Cards transaction recorded during the three months ended November 23, 2012.

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The table below summarizes the charges described above and their impact on our Consolidated Statement of Operations during the nine months ended November 23, 2012:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
Net sales	$	4.0	$	—	$	—	$	—	$	4.0
Administrative and general expenses		—		17.2		6.3		—		23.5
Other non-operating (income) expense		—		—		—		10.0		10.0
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

In addition to the charges summarized in the table above, our results were also affected by the operating results of our new Retail Operations segment and the intersegment sales elimination and intercompany profit adjustments between the International Social Expression Products segment and the Retail Operations segment. Since the Retail Operations segment is consolidated on a one-month lag corresponding with its fiscal year-end of February 2 for 2013, the operating results of this segment include only five months of activity in the current nine-month period. The impact of the acquisition of the retail stores on consolidated revenue for the three months ended November 23, 2012 was a net increase of approximately $42 million. The net increase was comprised of approximately $68 million of net sales from the new Retail Operations segment, reduced by approximately $26 million for the elimination of intersegment sales from the International Social Expression Products segment to the Retail Operations segment. The impact of the acquisition of the retail stores on consolidated revenue for the nine months ended November 23, 2012 was a net increase of approximately $69 million, including approximately $108 million of net sales from the new Retail Operations segment, reduced by approximately $39 million for the elimination of intersegment sales from the International Social Expression Products segment to the Retail Operations segment. For comparison purposes, the sales being eliminated in the current period would have been third-party sales in the prior year.

For the third quarter, the Clinton Cards acquisition adversely impacted pre-tax income by approximately $15.6 million, including the operating loss in the Retail Operations segment of $11.5 million and the impact of adjustments to intersegment profit associated with intercompany sales from the International Social Expression Products segment to the Retail Operations segment of $4.1 million. For the nine-month period, the Clinton Cards acquisition adversely impacted our pre-tax income by approximately $65.6 million, including the $37.5 million summarized in the table above and the $28.1 million of combined operating loss resulting from the Retail Operations segment and intersegment profit adjustment.

Third Quarter Results

Total revenue in the third quarter increased approximately $42 million, or 9% compared to the prior year period. As discussed above, the net impact of the Clinton Cards acquisition added approximately $42 million in total revenue. In addition, the combined effects of scan-based trading (“SBT”) implementations and foreign currency translation favorably impacted total revenue by approximately $2 million. Partially offsetting these increases were lower greeting card sales through our wholesale divisions of approximately $3 million compared to the prior year second quarter.

Third quarter operating income was $0.4 million compared to operating income of $33.2 million in the prior year, a decrease of $32.8 million. Beyond the impact of the Clinton Cards acquisition, which negatively impacted operating income by $15.6 million, compared to the prior period third quarter the current quarter operating income performance was impacted by additional legal expense, costs related to strategic actions with our International Social Expression Products segment, higher product content costs, unfavorable product mix, costs and fees associated with the Going Private Proposal and slightly more marketing expense.

During the current quarter, on September 26, 2012, we announced that our Board of Directors received a non-binding proposal from members of the Weiss family and related entities to acquire the Corporation (the “Going Private Proposal”). For further information, see Note 17, “Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation,” to the Consolidated Financial Statements.

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Results of Operations

Three months ended November 23, 2012 and November 25, 2011

Net loss was $0.8 million, or $0.03 per share, in the third quarter compared to net income of $20.2 million, or $0.50 per share, in the prior year third quarter (all per-share amounts assume dilution).

Our results for the three months ended November 23, 2012 and November 25, 2011 are summarized below:

(Dollars in thousands)	2012			% Total Revenue			2011			% Total Revenue
Net sales	$	499,368			98.5	%	$	458,535			98.6	%
Other revenue		7,446			1.5	%		6,472			1.4	%
Total revenue		506,814			100.0	%		465,007			100.0	%
Material, labor and other production costs		244,071			48.2	%		230,572			49.6	%
Selling, distribution and marketing expenses		190,041			37.5	%		141,501			30.4	%
Administrative and general expenses		74,483			14.7	%		60,510			13.0	%
Other operating income – net		(2,217	)		(0.4	%)		(813	)		(0.2	%)
Operating income		436			0.1	%		33,237			7.1	%
Interest expense		4,504			0.9	%		5,821			1.3	%
Interest income		(65	)		(0.0	%)		(207	)		(0.0	%)
Other non-operating income – net		(1,904	)		(0.4	%)		(2,077	)		(0.4	%)
(Loss) income before income tax (benefit) expense		(2,099	)		(0.4	%)		29,700			6.4	%
Income tax (benefit) expense		(1,290	)		(0.3	%)		9,454			2.0	%
Net (loss) income	$	(809	)		(0.2	%)	$	20,246			4.4	%

For the three months ended November 23, 2012, consolidated net sales were $499.4 million, an increase of $40.8 million, or 8.9%, from $458.5 million in the prior year third quarter. The increase was primarily related to the purchase of retail stores from Clinton Cards, which caused an increase in net sales of approximately $42 million during the current quarter compared to the prior year period. The increase was comprised of approximately $68 million of net sales from the new Retail Operations segment, reduced by approximately $26 million for the elimination of intersegment sales from the International Social Expression Products segment to the Retail Operations segment. For comparison purposes, the sales being eliminated in the current period would have been third-party sales in the prior year to Clinton Cards stores that were not owned by us at that time. In addition, seasonal greeting card sales through our wholesale divisions declined approximately $3 million. These decreases were offset by the favorable impact of SBT implementations and foreign currency translation of approximately $1 million each.

Other revenue, primarily royalty revenue from our Strawberry Shortcake and Care Bears properties, increased $1.0 million during the three months ended November 23, 2012.

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Wholesale Unit and Pricing Analysis for Greeting Cards

Unit and pricing comparatives (on a sales less returns basis) for the three months ended November 23, 2012 and November 25, 2011 are summarized below:

	Increase (Decrease) From the Prior Year
	Everyday Cards						Seasonal Cards						Total Greeting Cards
	2012			2011			2012			2011			2012			2011
Unit volume		(0.7	%)		7.7	%		(4.1	%)		(9.8	%)		(1.4	%)		3.6	%
Selling prices		1.6	%		(2.0	%)		(1.4	%)		8.7	%		0.8	%		0.1	%
Overall increase / (decrease)		0.9	%		5.5	%		(5.5	%)		(2.0	%)		(0.7	%)		3.7	%

During the third quarter, combined everyday and seasonal greeting card sales less returns decreased 0.7% compared to the prior year quarter, including an increase in selling prices of 0.8% which was more than offset by a decrease in unit volume of 1.4%. The overall decrease was driven by unit decline of everyday greeting cards within our North American Social Expression Products segment and unit decline of seasonal greeting cards within both our North American Social Expression Products and our International Social Expression Products segments.

Everyday card sales less returns for the third quarter increased 0.9% with improvements in selling prices of 1.6% more than offsetting a decline in unit volume of 0.7%. The unit volume decline was driven by our North American Social Expression Products segment. The selling price improvement was driven by both our North American Social Expression Products and our International Social Expression Products segments. The continued shift in mix to a higher proportion of value cards, which was less dramatic than in the prior year quarter, was more than offset by general price increases.

Seasonal card sales less returns declined 5.5% during the third quarter, including a 4.1% decline in unit volume and a 1.4% decline in selling prices. The decrease in unit volume during the current year quarter was primarily driven by our Christmas programs in both our North American Social Expression Products and our International Social Expression Products segments. The decrease in selling prices was driven by our Fall holiday program in our North American Social Expression Products segment and the continued shift in mix to a higher proportion of value cards in the period.

Expense Overview

Material, labor and other production costs (“MLOPC”) for the three months ended November 23, 2012 were $244.1 million, compared to $230.6 million in the prior year three months, an increase of $13.5 million. The new retail operations we purchased from Clinton Cards caused a net increase in MLOPC of approximately $3 million during the current quarter compared to the prior year third quarter. This net increase was comprised of approximately $25 million for cost of goods sold through the new Retail Operations segment, reduced by approximately $22 million for the adjustment to cost of goods related to intersegment sales from the International Social Expression Products segment to the Retail Operations segment. In addition, MLOPC increased approximately $8 million due to the result of unfavorable mix and higher product content costs. The current quarter included approximately $2 million higher scrap expense than the prior year period. We also incurred approximately $1 million of expense related to strategic actions in the International Social Expression Products segment, including the sale of a small non-card product line and the closure of a small giftwrap manufacturing facility in Italy.

Selling, distribution and marketing (“SDM”) expenses for the three months ended November 23, 2012 were $190.0 million compared to $141.5 million in the prior year third quarter, an increase of $48.5 million. The increase was driven by approximately $49 million of expenses within our new Retail Operations segment. In addition, higher marketing expenses and unfavorable foreign currency translation of approximately $1 million each were offset by lower supply chain costs, primarily field sales, merchandiser and distribution expenses, of approximately $2 million.

Administrative and general expenses were $74.5 million for the three months ended November 23, 2012, an increase of approximately $14 million from $60.5 million for the three months ended November 25, 2011. This increase was

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due to expenses within our new Retail Operations segment and higher legal expense of approximately $6 million each. The remaining approximately $2 million increase was related to costs and fees associated with the Going Private Proposal.

Other non-operating income – net was $1.9 million for the three months ended November 23, 2012 compared to $2.1 million for the three months ended November 25, 2011. The current year included a gain of $1.1 million associated with the sale of a portion of our investment in Party City. See Note 1, “Basis of Presentation,” to the Consolidated Financial Statements for further information.

The Corporation’s effective tax rate was 61.5% and 31.8% for the three months ended November 23, 2012 and November 25, 2011, respectively. The higher than statutory rate in the current quarter was due primarily to the low pretax loss, which magnified the impact that discrete items had on the effective tax rate.

Results of Operations

Nine months ended November 23, 2012 and November 25, 2011

Net income was $2.2 million, or $0.06 per share, in the nine months ended November 23, 2012 compared to $67.3 million, or $1.63 per share, in the prior year nine months.

Our results for the nine months ended November 23, 2012 and November 25, 2011 are summarized below:

(Dollars in thousands)	2012			% Total Revenue			2011			% Total Revenue
Net sales	$	1,275,139			98.6	%	$	1,217,800			98.3	%
Other revenue		18,617			1.4	%		21,097			1.7	%
Total revenue		1,293,756			100.0	%		1,238,897			100.0	%
Material, labor and other production costs		584,667			45.2	%		546,699			44.1	%
Selling, distribution and marketing expenses		466,199			36.0	%		392,630			31.7	%
Administrative and general expenses		225,521			17.4	%		186,734			15.1	%
Other operating income – net		(1,421	)		(0.1	%)		(6,858	)		(0.6	%)
Operating income		18,790			1.5	%		119,692			9.7	%
Interest expense		13,314			1.0	%		17,708			1.4	%
Interest income		(297	)		(0.0	%)		(838	)		(0.1	%)
Other non-operating expense (income) – net		3,523			0.3	%		(2,621	)		(0.2	%)
Income before income tax expense		2,250			0.2	%		105,443			8.5	%
Income tax expense		63			0.0	%		38,128			3.1	%
Net income	$	2,187			0.2	%	$	67,315			5.4	%

For the nine months ended November 23, 2012, consolidated net sales were $1.28 billion, up from $1.22 billion in the prior year nine months. This 4.7% increase, or approximately $57 million, was primarily related to the purchase of retail stores from Clinton Cards which caused an increase in net sales of approximately $69 million during the current nine months compared to the prior year period. The increase was comprised of approximately $108 million of net sales from the new Retail Operations segment, reduced by approximately $39 million for the elimination of intersegment sales from the International Social Expression Products segment to the Retail Operations segment. For comparison purposes, the sales being eliminated in the current period would have been third-party sales in the prior year to Clinton Cards stores that were not owned by us at that time. In addition, greeting card sales through our wholesale divisions improved approximately $8 million. Partially offsetting these increases were reduced gift packaging, party goods and other ancillary product sales of approximately $5 million, lower net sales in our fixtures business of approximately $4 million and a $4 million impairment of deferred costs related to the supply agreement associated with Clinton Cards’ Birthdays stores that were closed as part of the Clinton Cards bankruptcy administration process. Foreign currency translation and SBT implementations unfavorably impacted net sales by approximately $5 million and $1 million, respectively.

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Other revenue, primarily royalty revenue from our Strawberry Shortcake and Care Bears properties, decreased $2.5 million in the nine months ended November 23, 2012 compared to the same period in the prior year.

Wholesale Unit and Pricing Analysis for Greeting Cards

Unit and pricing comparatives (on a sales less returns basis) for the nine months ended November 23, 2012 and November 25, 2011 are summarized below:

	Increase (Decrease) From the Prior Year
	Everyday Cards						Seasonal Cards						Total Greeting Cards
	2012			2011			2012			2011			2012			2011
Unit volume		0.1	%		6.8	%		3.5	%		1.0	%		0.9	%		5.3	%
Selling prices		0.1	%		(1.9	%)		(0.9	%)		1.2	%		(0.1	%)		(1.1	%)
Overall increase / (decrease)		0.1	%		4.7	%		2.5	%		2.3	%		0.8	%		4.1	%

During the nine months ended November 23, 2012, combined everyday and seasonal greeting card sales less returns increased 0.8% compared to the prior year nine months, driven primarily by an increase in unit volume from our seasonal cards of 3.5%.

Everyday card sales less returns were up 0.1%, essentially flat compared to the prior year nine months.

Seasonal card sales less returns increased 2.5%, with unit volume improving 3.5% and selling prices declining 0.9%. The increase in unit volume compared to the prior year nine months was primarily driven by our Mother’s Day, Father’s Day and Graduation Day programs in our North American Social Expression Products segment and our Father’s Day program in our International Social Expression Products segment. The decrease in selling prices was driven by the continued shift in mix to a higher proportion of value line cards.

Expense Overview

MLOPC for the nine months ended November 23, 2012 were $584.7 million, an increase of $38.0 million from $546.7 million for the comparable period in the prior year. The new retail operations we purchased from Clinton Cards caused a net increase in MLOPC of approximately $13 million during the current year compared to the prior year nine months. This net increase was comprised of approximately $40 million for cost of goods sold through the new Retail Operations segment, reduced by approximately $27 million for the adjustment to cost of goods related to intersegment sales from the International Social Expression Products segment to the Retail Operations segment. Approximately $22 million of the remaining increase to MLOPC was attributable primarily to a combination of higher product content costs and an unfavorable change in sales mix, including the shift toward a higher proportion of value cards while maintaining a relatively consistent net sales level. Also contributing to the increase was approximately $3 million related to higher product display material costs and approximately $3 million of higher scrap expense. We also incurred approximately $1 million of expense related to strategic actions in the International Social Expression Products segment, including the sale of a small non-card product line and the closure of a small giftwrap manufacturing facility in Italy. These increases were partially offset by a decrease of approximately $2 million attributable primarily to lower sales volume in the wholesale businesses. In addition, foreign currency translation favorably impacted MLOPC by approximately $2 million during the current year nine months.

SDM expenses for the nine months ended November 23, 2012 were $466.2 million, increasing from $392.6 million for the comparable period in the prior year. The increase of $73.6 was driven by approximately $74 million of expenses within our new Retail Operations segment. Higher marketing expenses of approximately $8 million were offset by favorable foreign currency translation of approximately $2 million and lower costs in our field service and merchandiser organization of approximately $6 million, primarily related to prior year store setup activities for the value channel, which did not recur in the current period.

Administrative and general expenses were $225.5 million for the nine months ended November 23, 2012, increasing from $186.7 million for the nine months ended November 25, 2011. The increase of $38.8 million was driven

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partially by higher bad debt expense related to approximately $17 million recorded in the UK relating to increased unsecured accounts receivable exposure as a result of Clinton Cards being placed into administration during the current year. Transaction costs related to the purchase of the senior secured debt and the retail store acquisition of Clinton Cards of approximately $6 million were also recorded during the current year nine months. In addition, expenses with our new Retail Operations segment and higher legal expense added approximately $10 million each. Costs incurred in connection with our information technology systems refresh project increased approximately $3 million, while costs and fees associated with the Going Private Proposal added approximately $2 million. These increases were partially offset by reduced bad debt expense within our North American Social Expression Products segment and lower profit-sharing plan expenses of approximately $4 million and $3 million, respectively.

Other operating income – net was $1.4 million for the nine months ended November 23, 2012 compared to $6.9 million of income in the prior period. The prior year nine months included a gain of $4.5 million on the sale of certain minor characters in our intellectual property portfolio.

Other non-operating expense (income) – net was $3.5 million of expense for the nine months ended November 23, 2012 compared to $2.6 million of income for the prior period. The current year included an impairment charge of $10.0 million related to the senior secured debt of Clinton Cards that was acquired during the first quarter. This was partially offset by a gain of $4.3 million associated with the sale of a portion of our investment in Party City. See Note 1, “Basis of Presentation,” to the Consolidated Financial Statements for further information related to the Party City gain.

The Corporation’s effective tax rate was 2.8% and 36.2% for the nine months ended November 23, 2012 and November 25, 2011, respectively. The lower than statutory rate for the nine months ended November 23, 2012 is due primarily to lower taxable income, which magnified the impact that discrete items have on the effective tax rate, and the release of reserves upon lapse of the applicable statutes.

Segment Information

Our operations are organized and managed according to a number of factors, including product categories, geographic locations and channels of distribution. Our North American Social Expression Products and International Social Expression Products segments primarily design, manufacture and sell greeting cards and other related products through various channels of distribution, with mass retailers as the primary channel. As permitted under Accounting Standards Codification Topic 280, “Segment Reporting,” certain operating divisions have been aggregated into the International Social Expression Products segment. The aggregated operating divisions have similar economic characteristics, products, production processes, types of customers and distribution methods. At November 23, 2012, we operated approximately 400 card and gift retail stores in the UK through our Retail Operations segment. These stores sell products purchased from the International Social Expression Products segment as well as products purchased from other vendors. The AG Interactive segment distributes social expression products, including electronic greetings, and a broad range of graphics and digital services and products, through a variety of electronic channels, including Web sites, Internet portals, instant messaging services and electronic mobile devices.

Segment results are reported using actual foreign exchange rates for the periods presented. Refer to Note 16, “Business Segment Information,” to the Consolidated Financial Statements for further information and a reconciliation of total segment revenue to consolidated “Total revenue” and total segment earnings (loss) to consolidated “(Loss) income before income tax (benefit) expense.”

North American Social Expression Products Segment

(Dollars in	Three Months Ended November				% Change			Nine Months Ended November				% Change
thousands)	23, 2012		25, 2011					23, 2012		25, 2011
Total revenue	$	333,852	$	333,305		0.2	%	$	908,267	$	902,333		0.7	%
Segment earnings		22,099		28,016		(21.1	%)		98,757		113,009		(12.6	%)

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Total revenue of our North American Social Expression Products segment for the three and nine months ended November 23, 2012, increased $0.5 million and $5.9 million, respectively, compared to the prior year periods. The slight increase during the current quarter was primarily driven by higher sales of gift packaging, party goods and other ancillary products of approximately $5 million substantially offset by reduced greeting card sales of approximately $4 million. The increase in total revenue for the nine months ended November 23, 2012 was driven by higher greeting card sales of approximately $3 million and increased sales of gift packaging, party goods and other ancillary products of approximately $5 million. Foreign currently translation did not have a meaningful impact during the three month period and unfavorably impacted sales by approximately $2 million during the nine month period.

Segment earnings decreased $5.9 million in the current three months compared to the three months ended November 25, 2011. Higher product content costs and a change in sales mix, shifting toward a higher proportion of lower margin value cards while maintaining a relatively consistent overall segment net sales level, unfavorably impacted earnings by approximately $6 million. Increased marketing expenses of approximately $2 million were offset by decreased supply chain costs, specifically field sales, merchandiser and distribution expenses of approximately $2 million primarily related to prior year store setup activities for the value channel, which did not recur in the current period.

Segment earnings decreased $14.3 million in the current nine months compared to the prior year period. The decrease was driven by increased marketing expenses of approximately $11 million and incremental product display costs of approximately $4 million. Higher product content costs and a change in sales mix, shifting toward a higher proportion of lower margin value cards while maintaining relative sales levels, unfavorably impacted earnings by approximately $9 million. Also contributing to this decrease were increased expenses incurred in connection with our systems refresh project of approximately $3 million during the current year nine months. These unfavorable variances were partially offset by decreased bad debt expense and other cost savings initiatives of approximately $4 million and $2 million, respectively. In addition, supply chain costs, specifically field sales, merchandiser and distribution expenses, decreased approximately $7 million primarily related to prior year store setup activities for the value channel, which did not recur in the current period.

International Social Expression Products Segment

(Dollars in thousands)	Three Months Ended November					% Change			Nine Months Ended November					% Change
	23, 2012			25, 2011					23, 2012			25, 2011
Total revenue	$	76,434		$	103,352		(26.0	%)	$	200,406		$	249,448		(19.7	%)
Segment (loss) earnings		(710	)		9,537		—			(30,380	)		15,308		—

Total revenue of our International Social Expression Products segment decreased $26.9 million and $49.0 million for the three and nine months ended November 23, 2012, respectively, compared to the prior year periods. These decreases were primarily driven by the elimination of intersegment sales to the Retail Operations segment of $25.5 million and $39.1 million for the three and nine months ended November 23, 2012, respectively. For comparison purposes, the sales being eliminated would have been third-party sales in the prior year to Clinton Cards stores that were not owned by us at that time. The remaining decreases of approximately $1 million and $10 million for the current year three and nine months, respectively, were driven by a combination of lower sales of gift packaging and other ancillary products of approximately $5 million and $7 million for the three and nine months ended November 23, 2012, respectively. Partially offsetting these unfavorable impacts were increases in sales of greeting cards of approximately $3 million and $6 million for the current year three and nine months, respectively. Foreign currency translation favorably impacted sales by approximately $1 million for the current year three months and unfavorably impacted sales by approximately $3 million for the nine months ended November 23, 2012. The current year nine month period also included approximately $2 million of unfavorable SBT implementation impacts and a $4 million impairment of deferred costs related to the supply agreement associated with the Clinton Cards’ Birthdays stores that were closed as part of the Clinton Cards bankruptcy administration process.

Segment earnings decreased $10.2 million and $45.7 million in the three and nine months ended November 23, 2012, respectively, compared to the prior year periods. The decrease was partially driven by adjustments of $4.1

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million and $11.5 million for the three and nine months ended November 23, 2012, respectively, associated with intersegment earnings generated from sales to the Retail Operations segment. These adjustments reduce consolidated inventory for intercompany profit in the Retail Operations segment’s inventory and defer the recognition of this profit in the International Social Expression Products segment’s earnings until the inventory is sold to the ultimate customer in the Retail Operation’s segment. Approximately $3 million of the remaining decrease during the current quarter and the current year nine months was attributable to strategic business actions, including the sale of a small non-card product line and the closure of a small giftwrap manufacturing facility in Italy. The current year nine-month period included approximately $17 million of bad debt expense due to Clinton Cards being placed into administration and an approximate $4 million impairment of deferred costs related to the supply agreement associated with Clinton Cards’ Birthdays stores that were closed as part of the Clinton Cards bankruptcy administration process. The remaining decrease of approximately $3 million in the three month period was due to a combination of unfavorable mix and higher scrap expense. The remaining decrease of approximately $10 million in the nine month period was due to a combination of the impact of lower net sales, unfavorable mix, and higher scrap expense.

Retail Operations Segment

(Dollars in thousands)	Three Months Ended November					% Change		Nine Months Ended November					% Change
	23, 2012			25, 2011				23, 2012			25, 2011
Total revenue	$	67,635		$	—		—	$	107,519		$	—		—
Segment loss		(11,473	)		—		—		(16,579	)		—		—

On June 6, 2012, we acquired approximately 400 retail stores in the United Kingdom that we are operating under the “Clintons” brand. The retail operations are consolidated on a one-month lag corresponding with a fiscal year-end of February 2 for fiscal 2013. As such, the operating results of the Retail Operations segment for the nine month period ended November 23, 2012 include only five months of activity, beginning June 6, 2012, the date of acquisition. As with many retail businesses, the Retail Operations segment’s business is extremely seasonal in nature. As such, the overall profitably of this segment is highly dependent on success during the December holiday season. The future profitability of this segment is also dependent on the ultimate number of stores that we acquire and our success in negotiating more favorable lease terms with landlords. The segment loss of $16.6 million in the nine month period ended November 23, 2012 included start-up and transitional costs of approximately $6.4 million related to the actions taken to execute our strategy to stabilize and improve the profitability of the stores acquired.

AG Interactive Segment

(Dollars in thousands)	Three Months Ended November				% Change			Nine Months Ended November				% Change
	23, 2012		25, 2011					23, 2012		25, 2011
Total revenue	$	15,982	$	16,878		(5.3	%)	$	47,255	$	49,664		(4.9	%)
Segment earnings		5,331		3,737		42.7	%		13,713		10,970		25.0	%

Total revenue of our AG Interactive segment for the three months ended November 23, 2012 was $16.0 million compared to $16.9 million in the prior year third quarter. Total revenue of our AG Interactive segment for the nine months ended November 23, 2012 was $47.3 million compared to $50.0 million in the prior year nine months. These decreases in revenue were driven primarily by lower advertising revenue. At the end of the third quarter of fiscal 2013 and 2012, AG Interactive had approximately 3.7 million and 3.6 million, respectively, of on-line paid subscriptions.

Segment earnings increased $1.6 million for the three months ended November 23, 2012 and $2.7 million during the nine months ended November 23, 2012 compared to the prior year periods due to reduced product management and marketing costs, and lower expenses resulting from cost savings initiatives, which were partially offset by the impact of lower revenues.

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Unallocated Items

Centrally incurred and managed costs are not allocated back to the operating segments. The unallocated items include interest expense for centrally incurred debt, domestic profit-sharing expense and stock-based compensation expense. Unallocated items also included costs associated with corporate operations such as the senior management, corporate finance, legal and insurance programs. During the three months ended November 23, 2012, unallocated items included increased legal expense of approximately $6 million compared to the prior year period and approximately $2 million of costs and fees associated with the Going Private Proposal. During the nine months ended November 23, 2012, unallocated items included higher legal expense and a charge related to the impairment of the senior secured debt of Clinton Cards of $10 million each, transaction costs of approximately $6 million related to the acquisition of the secured debt and retail stores of Clinton Cards and approximately $2 million of costs and fees associated with the Going Private Proposal.

	Three Months Ended November						Nine Months Ended November
(Dollars in thousands)	23, 2012			25, 2011			23, 2012			25, 2011
Interest expense	$	(4,504	)	$	(5,853	)	$	(13,314	)	$	(17,708	)
Profit-sharing plan expense		(423	)		(1,078	)		(3,852	)		(6,308	)
Stock-based compensation expense		(2,965	)		(2,676	)		(7,806	)		(8,038	)
Corporate overhead expense		(12,713	)		(4,351	)		(43,790	)		(19,257	)
Total Unallocated	$	(20,605	)	$	(13,958	)	$	(68,762	)	$	(51,311	)

Liquidity and Capital Resources

The seasonal nature of our business precludes a useful comparison of the current period and the fiscal year-end financial statements; therefore, a Consolidated Statement of Financial Position as of November 25, 2011, has been included.

Operating Activities

Operating activities provided $32.1 million of cash during the nine months ended November 23, 2012, compared to using $26.5 million in the prior year period.

Accounts receivable used $101.4 million of cash during the nine months ended November 23, 2012, compared to $122.3 million of cash during the prior year period. The year-over-year change in cash flow of $21.0 million was primarily a result of our purchase of Clinton Cards stores. A decrease of approximately $45 million occurred within our International Social Expression Products segment where the accounts receivable balance from Clinton Cards is now being accounted for through intercompany transactions, which changes the timing of cash flow compared to the prior year. This was partially offset by an increase of approximately $9 million within our new Retail Operations segment. In addition, cash usage of approximately $10 million occurred within our North American Social Expression Products segment due to the timing of collections from, or credits issued to, certain customers occurring in a different pattern in the current period compared to the prior period.

Inventory used $39.1 million of cash during the nine months ended November 23, 2012, compared to $30.9 million in the prior year nine months. Historically, the first nine months of our fiscal year is a period of inventory build, and thus a use of cash, in preparation for the winter seasonal holidays. The higher use of cash in the prior year was primarily due to the inventory build of cards associated with expanded distribution with existing customers.

Other current assets used $18.0 million of cash during the current year nine months, compared to providing $6.5 million of cash in the prior year period. The use of cash during the current year period was attributable to our new Retail Operations segment.

Deferred costs–net generally represents payments under agreements with retailers net of the related amortization of those payments. During the nine months ended November 23, 2012, amortization exceeded payments by $23.7 million. During the nine months ended November 25, 2011, payments exceeded amortization by $3.8 million. See Note 10 to the Consolidated Financial Statements for further detail of deferred costs related to customer agreements.

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Accounts payable and other liabilities provided $112.3 million of cash during the nine months ended November 23, 2012, compared to $3.5 million in the prior year period. The year-over-year change was primarily attributable to the timing of payments compared to the prior year. This timing difference is expected to reverse during the current year fourth quarter. The growth in accounts payable and other liabilities, and thus an increase in cash flow in the current period, was due to our new Retail Operations segment as well as activities related to our information technology systems refresh project and other strategic projects.

Investing Activities

Investing activities used $137.9 million of cash during the nine months ended November 23, 2012, compared to $41.3 million in the prior year period. During the current year first quarter we paid $56.6 million of cash to acquire all of the outstanding senior secured debt of Clinton Cards. In addition, cash paid for capital expenditures was $87.4 million. The increase in capital expenditures compared to the prior year nine-month period related primarily to assets acquired in connection with our information technology systems refresh and investments in our new Retail Operations segment.

During the prior year nine-month period, the use of cash was primarily related to cash payments for business acquisitions as well as capital expenditures of $49.0 million. In addition, cash paid for the March 1, 2011 acquisition of Watermark Publishing Limited, net of cash acquired, was $5.9 million. Partially offsetting these uses of cash in the prior year period were cash receipts of $6.0 million from the sale of the land and building relating to our DesignWare party goods product lines in our North American Social Expression Products segment, $4.5 million from the sale of certain minor characters in our intellectual property portfolio, and $2.4 million from the sale of the land, building and certain equipment associated with a distribution facility in our International Social Expression Products segment.

Financing Activities

Financing activities provided $36.9 million of cash during the current year nine months, compared to using $58.8 million during the prior year. The current year source of cash is primarily attributable to our borrowings under our credit agreement, which provided $131.7 million of cash during the current year nine months. Partially offsetting this source of cash were share repurchases and dividend payments. We paid $78.7 million to repurchase approximately 5.3 million Class A common shares under our repurchase programs during the nine month period ended November 23, 2012. In addition, we paid cash dividends of $15.2 million during this period.

The prior year use of cash relates primarily to share repurchases and dividend payments. We paid $45.2 million to repurchase approximately 2.5 million Class A common shares under our repurchase program and $10.1 million to purchase approximately 0.4 million Class B common shares in accordance with our Amended and Restated Articles of Incorporation. In addition, we paid cash dividends of $18.1 million. Partially offsetting these uses of cash was our receipt of the exercise price on stock options and excess tax benefits from share-based payment awards, which provided $14.7 million of cash during the prior year nine months.

Credit Sources

Substantial credit sources are available to us. In total, we have available sources of credit of approximately $450 million, which included our $400 million senior secured revolving credit facility and our $50 million accounts receivable securitization facility, of which $287.7 million was unused as of November 23, 2012. On September 21, 2012, the accounts receivable securitization facility was amended to decrease the amount of available financing thereunder from $70 million to $50 million. Borrowings under the accounts receivable securitization facility are limited based on our eligible receivables outstanding. At November 23, 2012, we had $131.7 million of borrowings outstanding under our credit facility and we had no borrowings outstanding under the accounts receivable securitization facility. We had, in the aggregate, $30.6 million outstanding under letters of credit, which reduced the total credit availability thereunder as of November 23, 2012.

On December 19, 2012, we amended our credit agreement to modify the definition of Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), effective as of November 23, 2012, to exclude from the

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definition of consolidated EBITDA up to $40 million of certain cash and non-cash fees, costs and expenses incurred by us from April 1, 2012 through December 19, 2013 in connection with our acquisition of the senior secured debt of Clinton Cards and its subsidiaries, the bankruptcy administration of Clinton Cards and its subsidiaries, and the subsequent acquisition of select assets of Clinton Cards and certain of its subsidiaries. At November 23, 2012, we were in compliance with the financial covenants under our borrowing agreements, as amended.

For further information, please refer to the discussion of our borrowing arrangements as disclosed in the “Credit Sources” section under Part II, Item 7 of our Annual Report on Form 10-K for the year ended February 29, 2012.

Capital Deployment and Investments

Throughout fiscal 2013 and thereafter, we will continue to consider all options for capital deployment including growth options, acquisitions and other investments in third parties, expanding customer relationships, expenditures or investments related to our current product leadership initiatives or other future strategic initiatives, capital expenditures including amounts to refresh the Clinton Cards’ stores acquired in June 2012, the information technology systems refresh, our new world headquarters project to the extent resumed, and, as appropriate, preserving cash.

As we have stated, our objective is to continue to expand our position as a leading creator, manufacturer and distributor of social expression products. As such, we have focused and expect to continue to focus our resources on our core greeting card business, developing new, and growing existing, business, including by expanding Internet and other channels of electronic distribution to make American Greetings the natural and preferred social expressions solution, as well as by capturing any shifts in consumer demand. For example, during the full year of fiscal 2012, we spent approximately $15 million on incremental marketing expenses in support of our product leadership strategy, primarily related to promotional efforts around our recently developed Web site Cardstore.com, which allows consumers to purchase paper greeting cards on the Internet and then have the physical cards delivered directly to the recipient. During the first nine months of fiscal 2013, incremental marketing expenses related to Cardstore.com and other product launches increased approximately $10 million compared to the prior year nine months. As we seek to develop this and other channels of distribution, we expect that we will continue to incur additional expenses and make additional investments to support these efforts. We will likely continue this spending during the remaining months of fiscal 2013; however, the timing and amount will depend on consumer response. In addition, to the extent we are successful in expanding distribution and revenue in connection with expanding our leadership, additional capital may be deployed as we may incur incremental costs associated with this expanded distribution, including upfront costs prior to any incremental revenue being generated. If incurred, these costs may be material.

Over roughly the next five or six years, we expect to allocate resources, including capital, to refresh our information technology systems by modernizing our systems, redesigning and deploying new processes, and evolving new organization structures all intended to drive efficiencies within the business and add new capabilities. Amounts that we spend could be material in any given fiscal year and over the life of the project. During the full year of fiscal 2012, we spent approximately $25 million, including capital of approximately $19 million and expense of approximately $6 million, on these information technology systems. During the nine months ended November 23, 2012, we spent approximately $47 million on these information technology systems, including capital of approximately $39 million and expense of approximately $8 million compared to approximately $11 million of capital and $5 million of expense in the first nine months of fiscal 2012. In addition, over roughly the next five or six years, we currently expect to spend at least an aggregate of $150 million on these information technology systems, the majority of which we expect will be capital expenditures. We believe these investments are important to our business, help us drive further efficiencies and add new capabilities; however, there can be no assurance that we will achieve the associated efficiencies or any cost savings.

During fiscal 2012, we announced that we expect that we will begin to invest in the development of a world headquarters in the Northeast Ohio area. The state of Ohio has committed certain tax credits, loans and other incentives totaling up to $93.5 million to assist us in the development of a new headquarters in Ohio. We are required to make certain investments and meet other criteria to receive these incentives over time. We are currently in the preconstruction stages of the project and have not yet completed the architectural design for the new building.

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On November 19, 2012, we announced that we are delaying plans to develop the new world headquarters facility in light of the Going Private Proposal referred to in Note 17, “Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation,” to the Consolidated Financial Statements.

During the third quarter of fiscal 2013, we repurchased $15.9 million of our Class A common shares under the $75 million stock repurchase program announced on July 24, 2012. Under this program, the share repurchases may be made through open market purchases or privately negotiated transactions as market conditions warrant, at prices we deem appropriate, and subject to applicable legal requirements and other factors. There is no set expiration date for this program. However, purchases under this stock repurchase program were suspended due to the Going Private Proposal referred to in Note 17, “Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation,” to the Consolidated Financial Statements.

In connection with our acquisition of Clinton Cards, we expect to acquire approximately 400 retail stores. Based on current contracts and negotiations, as of November 23, 2012, we have completed lease assignments for 185 of these approximately 400 stores. Assuming that the remaining landlords consent to terms proposed by us and we are able to successfully complete assignments for all of the approximately 400 stores, as of November 23, 2012, we anticipate the estimated future minimum rental payments for noncancelable operating leases related to acquired stores will be approximately $367 million. Refer to Note 4, “Acquisition,” to the Consolidated Financial Statements for further information.

Our future operating cash flow and borrowing availability under our credit agreement and our accounts receivable securitization facility are expected to meet currently anticipated funding requirements. The seasonal nature of our business results in peak working capital requirements that may be financed through short-term borrowings when cash on hand is insufficient.

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Please refer to the discussion of our Critical Accounting Policies as disclosed in our Annual Report on Form 10-K for the year ended February 29, 2012.

Factors That May Affect Future Results

Certain statements in this report may constitute forward-looking statements within the meaning of the Federal securities laws. These statements can be identified by the fact that they do not relate strictly to historic or current facts. They use such words as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. These forward-looking statements are based on currently available information, but are subject to a variety of uncertainties, unknown risks and other factors concerning our operations and business environment, which are difficult to predict and may be beyond our control. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect our future financial performance, include, but are not limited to, the following:

• a weak retail environment and general economic conditions;

• the loss of one or more retail customers and/or retail consolidations, acquisitions and bankruptcies, including the possibility of resulting adverse changes to retail contract terms;

• competitive terms of sale offered to customers, including costs and other terms associated with new and expanded customer relationships;

• the ability to successfully integrate Clinton Cards and achieve the anticipated revenue and operating profits, together with the outcome of negotiations with landlords and the ultimate number of stores acquired;

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• the ability of the administrators to generate sufficient proceeds from the liquidation of the remaining Clinton Cards business to repay the remaining secured debt owed to us;

• the timing and impact of expenses incurred and investments made to support new retail or product strategies, including increased marketing expenses, as well as new product introductions and achieving the desired benefits from those investments;

• the timing of investments in, together with the ability to successfully implement or achieve the desired benefits and cost savings associated with, any information systems refresh we may implement;

• the timing and amount of expenses incurred by us in connection with the non-binding Going Private Proposal dated September 25, 2012 from Zev Weiss, its Chief Executive Officer, and Jeffrey Weiss, its President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties to acquire all of our outstanding Class A and Class B common shares not currently owned by them;

• the timing and impact of converting customers to a scan-based trading model;

• the ability to achieve the desired benefits associated with our cost reduction efforts;

• Schurman Fine Papers’ ability to successfully operate its retail operations and satisfy its obligations to us;

• consumer demand for social expression products generally, shifts in consumer shopping behavior, and consumer acceptance of products as priced and marketed, including the success of new and expanded advertising and marketing efforts, such as our on-line efforts through Cardstore.com;

• the impact and availability of technology, including social media, on product sales;

• escalation in the cost of providing employee health care;

• the ability to achieve the desired accretive effect from any share repurchase programs;

• the ability to comply with our debt covenants;

• fluctuations in the value of currencies in major areas where we operate, including the U.S. Dollar, Euro, UK Pound Sterling and Canadian Dollar; and

• the outcome of any legal claims known or unknown.

Risks pertaining specifically to AG Interactive include the viability of on-line advertising, subscriptions as revenue generators, and the ability to adapt to rapidly changing social media and the digital photo sharing space.

The risks and uncertainties identified above are not the only risks we face. Additional risks and uncertainties not presently known to us or that we believe to be immaterial also may adversely affect us. Should any known or unknown risks or uncertainties develop into actual events, or underlying assumptions prove inaccurate, these developments could have material adverse effects on our business, financial condition and results of operations. For further information concerning the risks we face and issues that could materially affect our financial performance related to forward-looking statements, refer to our periodic filings with the Securities and Exchange Commission, including the “Risk Factors” section included in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended February 29, 2012 and included in Part II, Item 1A of our Quarterly Reports on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

For further information, refer to our Annual Report on Form 10-K for the year ended February 29, 2012. There were no material changes in market risk, specifically interest rate and foreign currency exposure, for us from February 29, 2012, the end of our preceding fiscal year, to November 23, 2012, the end of our most recent fiscal quarter.

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Item 4. Controls and Procedures

American Greetings maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its reports under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to the Corporation’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

American Greetings carries out a variety of on-going procedures, under the supervision and with the participation of the Corporation’s management, including its Chief Executive Officer and Chief Financial Officer, to evaluate the effectiveness of the design and operation of the Corporation’s disclosure controls and procedures. Based on the foregoing, the Chief Executive Officer and Chief Financial Officer of American Greetings concluded that the Corporation’s disclosure controls and procedures were effective as of the end of the period covered by this report.

There has been no change in the Corporation’s internal control over financial reporting during the Corporation’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings

Baker/Collier Litigation. American Greetings Corporation is a defendant in two putative class action lawsuits involving corporate-owned life insurance policies (the “Insurance Policies”): one filed in the Northern District of Ohio on January 11, 2012 by Theresa Baker as the personal representative of the estate of Richard Charles Wolfe (the “Baker Litigation”); and the other filed in the Northern District of Oklahoma on October 1, 2010 by Keith Collier as the personal representative of the estate of Ruthie Collier (the “Collier Litigation”).

In the Baker Litigation, the plaintiff claims that American Greetings Corporation (1) misappropriated its employees’ names and identities to benefit itself; (2) breached its fiduciary duty by using its employees’ identities and personal information to benefit itself; (3) unjustly enriched itself through the receipt of corporate-owned life insurance policy benefits, interest and investment returns; and (4) improperly received insurance policy benefits for the insurable interest in Mr. Wolfe’s life. The plaintiff seeks damages in the amount of all pecuniary benefits associated with the subject Insurance Policies, including investment returns, interest and life insurance policy benefits that American Greetings Corporation received from the deaths of the former employees whose estates form the putative class. The plaintiff also seeks punitive damages, pre- and post-judgment interest, costs and attorney’s fees. On April 30, 2012, American Greetings Corporation filed a Motion to Dismiss the Complaint. Shortly thereafter, the plaintiff filed a Motion for Class Certification. The court stayed the plaintiff’s Motion for Class Certification until the Motion to Dismiss was decided. On September 19, 2012, the Ohio federal court ordered the Baker plaintiff to file an amended complaint and then denied without prejudice American Greetings’ Motion to Dismiss the Baker Litigation as moot. On October 1, 2012, the plaintiff filed a Second Amended Complaint. On October 18, 2012, American Greetings Corporation filed its Motion to Dismiss the Second Amended Complaint. Class certification has not been decided in either of these cases.

In the Collier Litigation, the plaintiff claims that American Greetings Corporation did not have an insurable interest when it obtained the subject Insurance Policies and wrongfully received the benefits from those policies. The plaintiff seeks damages in the amount of policy benefits received by American Greetings Corporation from the subject Insurance Policies, as well as attorney’s fees, costs and interest. On April 2, 2012, the plaintiff filed its First Amended Complaint, adding misappropriation of employee information and breach of fiduciary duty claims as well as seeking punitive damages. On April 20, 2012, American Greetings Corporation moved to transfer the Collier Litigation to the Northern District of Ohio, where the Baker Litigation is pending. On July 6, 2012, the court granted American Greetings Corporation’s Motion to Transfer and transferred the case to the Northern District of Ohio, where the Baker Litigation is pending.

As requested by the court, the parties filed a joint proposed scheduling order on October 29, 2012, setting the Collier and Baker Litigations on parallel procedural tracks. On January 2, 2013, the parties filed a Joint Motion to Stay the Collier and Baker Litigations for 60 days to allow the parties to engage in private mediation. The same law firm represents the individual plaintiffs in the Collier and Baker Litigations.

Cookie Jar/MoonScoop Litigation. As previously disclosed, on May 6, 2009, American Greetings Corporation and its subsidiary, Those Characters From Cleveland, Inc. (“TCFC”), filed an action in the Cuyahoga County (Ohio) Court of Common Pleas against Cookie Jar Entertainment Inc. (“Cookie Jar”) and its affiliates, Cookie Jar Entertainment (USA) Inc. (formerly known as DIC Entertainment Corporation) (“DIC”) and Cookie Jar Entertainment Holdings (USA) Inc. (formerly known as DIC Entertainment Holdings, Inc.) relating to the July 20, 2008 Binding Letter Agreement between American Greetings Corporation and Cookie Jar (the “Cookie Jar Agreement”) for the sale of the Strawberry Shortcake and Care Bears properties (the “Properties”). On May 7, 2009, Cookie Jar removed the case to the United States District Court for the Northern District of Ohio. Simultaneously,

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Cookie Jar filed an action against American Greetings Corporation, TCFC, Mike Young Productions, LLC (“Mike Young Productions”) and MoonScoop SAS (“MoonScoop”) in the Supreme Court of the State of New York, County of New York. Mike Young Productions and MoonScoop were named as defendants in the action in connection with the binding term sheet between American Greetings Corporation and MoonScoop dated March 24, 2009 (the “MoonScoop Binding Agreement”), providing for the sale to MoonScoop of the Properties.

On May 7, 2010, the legal proceedings involving American Greetings Corporation, TCFC, Cookie Jar and DIC were settled, without a payment to any of the parties. As part of the settlement, on May 7, 2010, the Cookie Jar Agreement was amended to, among other things, terminate American Greetings Corporation’s obligation to sell to Cookie Jar, and Cookie Jar’s obligation to purchase, the Properties. As part of the settlement, Cookie Jar Entertainment (USA) Inc. will continue to represent the Strawberry Shortcake property on behalf of American Greetings Corporation and will become an international agent for the Care Bears property. On May 19, 2010, the Northern District of Ohio court granted the parties’ joint Motion to Dismiss all claims and counterclaims without prejudice.

On August 11, 2009, MoonScoop filed an action against American Greetings Corporation and TCFC in the United States District Court for the Northern District of Ohio, alleging breach of contract and promissory estoppel relating to the MoonScoop Binding Agreement. On MoonScoop’s request, the court agreed to consolidate this lawsuit with the first Ohio lawsuit (described above) for all pretrial purposes. The parties filed Motions for Summary Judgment on various claims. On April 27, 2010, the court granted American Greetings Corporation’s Motion for Summary Judgment on MoonScoop’s breach of contract and promissory estoppel claims, dismissing these claims with prejudice. On the same day, the court also ruled that American Greetings Corporation must indemnify MoonScoop against Cookie Jar’s claims in this lawsuit. On May 21, 2010, MoonScoop appealed the court’s summary judgment ruling to the United States Court of Appeals for the Sixth Circuit. On June 4, 2010, American Greetings Corporation and TCFC appealed to the United States Court of Appeals for the Sixth Circuit the court’s ruling that it must indemnify MoonScoop against the cross claims asserted against it. On July 16, 2012, the U.S. Sixth Circuit Court of Appeals reversed the Northern District of Ohio court’s order that had granted American Greetings Corporation’s Motion for Summary Judgment on MoonScoop’s principal claims. The case has been remanded to the District Court for further proceedings. The Court of Appeals also affirmed the District Court’s finding on summary judgment in favor of MoonScoop on its indemnity claim, involving MoonScoop’s attorney fees for defending against Cookie Jar’s third-party claims (which have been dismissed). As a result, the Corporation has reimbursed MoonScoop for the $161,309 in attorney fees that it incurred. The District Court held trial beginning November 13, 2012. The jury returned a unanimous verdict in favor of American Greetings Corporation and TCFC. On November 26, 2012, the District Court entered judgment in favor of American Greetings Corporation and against MoonScoop. On December 20, 2012, MoonScoop appealed the verdict to the United States Court of Appeals for the Sixth Circuit.

Carter/Wolfe/LMPERS Litigation. On September 26, 2012, the Corporation announced that the Board of Directors had received the Going Private Proposal dated September 25, 2012 from Zev Weiss, our Chief Executive Officer, and Jeffrey Weiss, our President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties, to acquire all of the outstanding Class A and Class B common shares not currently owned by them for $17.18 per share. On September 27, 2012, Dolores Carter, a purported shareholder, filed a putative class action and shareholder derivative lawsuit in the Court of Common Pleas in Cuyahoga County, Ohio, against American Greetings Corporation and all of the members of its Board of Directors, alleging that the directors breached their fiduciary duties in evaluating the proposal and seeking declaratory relief. Subsequently, eight more lawsuits were filed in Cuyahoga County state court against American Greetings Corporation and its Board of Directors. One lawsuit was voluntarily dismissed. The remaining lawsuits were consolidated and remain pending with the commercial docket in Cuyahoga County court. On December 6, 2012, the court appointed the lead plaintiff and lead plaintiff’s counsel.

On November 6, 2012, R. David Wolfe, a purported shareholder, filed a putative class action in the United States District Court for the Northern District of Ohio against American Greetings Corporation, certain members of the Weiss family, the Irving I. Stone Oversight Trust, Irving Stone Limited Liability Company, Irving I. Stone Support Foundation and Irving I. Stone Foundation, alleging breach of fiduciary duties against certain Weiss defendants by proposing and pursuing the Going Private Proposal (the “Wolfe Litigation”) and seeking declaratory relief. Shortly thereafter, on November 9, 2012, the Louisiana Municipal Police Employees’ Retirement System filed a similar, purported class action against the same defendants as the Wolfe Litigation, also alleging breach of fiduciary duties against certain Weiss defendants and seeking declaratory relief (the “LMPERS Litigation”).

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On November 30, 2012, the Wolfe Litigation plaintiff filed Motions to (1) Consolidate the Wolfe and LMPERS Litigations; (2) for Appointment as Co-lead Plaintiff; (3) for Appointment as Co-Lead Plaintiff’s Counsel, and (4) for Partial Summary Judgment. On December 14, 2012, American Greetings Corporation filed its Oppositions to the Motions (a) to Consolidate the Wolfe and LMPERS Litigation, (b) for Appointment as Co-Lead Plaintiff and (c) for Appointment as Co-Lead Plaintiff’s Counsel. On the same day, American Greetings Corporation also filed a Motion to Dismiss the action.

Management does not believe, based on currently available information, that the outcomes of the proceedings described above will have a material adverse effect on the Corporation’s financial condition, though the outcomes could be material to the Corporation’s operating results for any particular period, depending, in part, upon the operating results for such period.

In addition to the foregoing, we are involved in various judicial, administrative, regulatory and arbitration proceedings concerning matters arising in the ordinary course of business operations, including, but not limited to, employment, commercial disputes and other contractual matters. We, however, do not believe that any of the other litigation in which we are currently engaged, either individually or in the aggregate, will have a material adverse effect on our business, consolidated financial position or results of operations.

Item 1A. Risk Factors

The information presented below updates and supplements the risk factors contained in our Annual Report on Form 10-K for the year ended February 29, 2012 and the Quarterly Reports on Form 10-Q for the quarters ended May 25, 2012 and August 24, 2012. The risks described herein and in such reports are not the only risks facing our Corporation. Additional risks and uncertainties, which we do not presently consider material or of which we are not currently aware, may also have an adverse impact on us.

There are risks and uncertainties as a result of the non-binding proposal by members of the Weiss family and related entities to acquire the Corporation.

As described in Note 17 to the Consolidated Financial Statements, on September 26, 2012, we announced that our Board of Directors received the Going Private Proposal, a non-binding proposal dated September 25, 2012 from Zev Weiss, our Chief Executive Officer, and Jeffrey Weiss, our President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties, to acquire all of our outstanding Class A and Class B common shares not currently owned by them for $17.18 per share.

Our Board of Directors has formed a special committee of independent directors (the “Special Committee”) to consider the Going Private Proposal. The Special Committee is also authorized to review and evaluate other options available to the Corporation, and has retained its own financial advisor as well as legal counsel. On December 5, 2012, Messrs. Zev and Jeffrey Weiss delivered to the Special Committee a letter reiterating the Going Private Proposal and informing the Special Committee of the current status of their discussions with potential financing sources. As described in Part II, Item 1 of this Report, since the announcement of the Going Private Proposal, a number of lawsuits have been filed in State and Federal court against the Corporation, all of the members of our Board of Directors as well as members of the Weiss family and related parties. Shareholders and others considering trading in our securities are cautioned that no decision has been made with respect to the Corporation’s response to the proposal. In addition, there can be no assurance that any definitive, binding offer will be made, that any agreement will be executed or that the transaction contemplated in the proposal or any other transaction will be approved or consummated. Until such time as the Corporation enters into or declares that it will not enter into a definitive agreement with respect to the transaction contemplated in the proposal or any alternative transaction, the price of our common shares may change to reflect market assumptions as to whether any transaction is likely to occur. In addition, we are likely to incur significant costs, expenses and fees for professional services and other costs in connection with the proposal, and many of these fees and costs will be payable by us regardless of whether any transaction is consummated.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Not applicable.

(b) Not applicable.

(c) The following table provides information with respect to our purchases of our common shares during the three months ended November 23, 2012.

Period	Total Number of Shares Repurchased	Average Price Paid per  Share			Total Number of Shares Purchased as Part of Publicly Announced Plans			Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Plans
September 2012	Class A –1,050,000 Class B – —	$	15.12 —	(1)		1,050,000 —	(2)	$	43,435,318
October 2012	Class A – —   Class B – —		—   —			—   —		$	43,435,318
November 2012	Class A – —   Class B – —		—   —			—   —		$	43,435,318
Total	Class A – —   Class B – —					—   —

(1) Excludes commissions paid, if any, related to the share repurchase transactions.

(2) On July 24, 2012, American Greetings announced that its Board of Directors authorized a program to repurchase up to $75 million of its Class A common shares. Under this program, the share repurchases may be made through open market purchases or privately negotiated transactions as market conditions warrant, at prices the Corporation deems appropriate, and subject to applicable legal requirements and other factors. There is no set expiration date for this program; however, purchases under this program have been suspended due to the Going Private Proposal referred to in Note 17, “Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation,” to the Consolidated Financial Statements.

Item 6. Exhibits

Exhibits required by Item 601 of Regulation S-K

Exhibit Number	Description
10.1	Separation Agreement, dated October 24, 2012, by and between Michael Goulder and American Greetings Corporation.
10.2	Retention Bonus Agreement, dated November 4, 2012, by and between Robert Tyler and American Greetings Corporation.

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31 (a)	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31 (b)	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following materials from the Corporation’s quarterly report on Form 10-Q for the quarter ended November 23, 2012, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statement of Operations for the quarters ended November 23, 2012, and November 25, 2011, (ii) Consolidated Statement of Comprehensive Income for the quarters ended November 23, 2012, and November 25, 2011, (iii) Consolidated Statement of Financial Position at November 23, 2012, February 29, 2012 and November 25, 2011, (iv) Consolidated Statement of Cash Flows for the nine months ended November 23, 2012, and November 25, 2011, and (v) Notes to the Consolidated Financial Statements for the quarter ended November 23, 2012. In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be part of any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

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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
By:	/s/ Robert D. Tyler
	Robert D. Tyler
	Corporate Controller and
	Chief Accounting Officer *

January 2, 2013

* (Signing on behalf of Registrant as a duly authorized officer of the Registrant and signing as the chief accounting officer of the Registrant.)

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EX-10.1

Exhibit 10.1

September 28, 2012

Michael Goulder

American Greetings Corporation

One American Road

Cleveland, Ohio 44144

Re: Separation & Release Agreement

Dear Mike:

This Separation and Release Agreement, together with the attached Exhibit A (“Supplemental Release”) (collectively “Agreement”), reflects our mutual agreement regarding the terms of your employment with American Greetings Corporation (together with its subsidiaries and affiliates referred to as “American Greetings”), as well as the terms of the separation of your employment from American Greetings. This Separation and Release Agreement is specifically intended to supersede your employment agreement with American Greetings that was executed in 2002 (the “2002 Agreement”) and the 2009 Amendment thereto (“2009 Amendment” and, together with the 2002 Agreement, the “Original Agreement”), together with any other employment agreement, written or oral, you may have with American Greetings, all of which you agree and acknowledge shall terminate and become null and void and have no effect whatsoever once you execute this Separation and Release Agreement.

1. Separation from Employment on February 28, 2013. Rather than terminate your employment immediately, you shall be permitted to remain an active American Greetings’ associate through February 28, 2013 (the “Separation Date”), upon which date American Greetings will involuntarily terminate your employment. Until the Separation Date, you will continue to receive: (i) salary payments at the annual base salary rate you received as ofSeptember 15, 2012, less applicable withholdings and deductions, paid in accordance with American Greetings’ payroll practices in the ordinary course; and (ii) benefits at the level and of the type you received as of September 28, 2012.

2. Separation Benefits. Subject to the terms of this Separation and Release Agreement, and subject to approval by the Compensation and Management Development Committee of the Board of Directors of American Greetings Corporation, if you sign this Separation and Release Agreement and it becomes effective, you will receive the following payments and benefits in the manner and time frames described in this Section 2. You acknowledge and agree that certain of the payments and benefits differ from and are greater than benefits you would otherwise be eligible to receive upon resignation or separation from service absent this Separation and Release Agreement.

a. Deferred Separation Date. You will be permitted to maintain your employment status and your formal Separation Date shall be delayed until February 28, 2013.

b. Separation Pay. From the Separation Date (February 28, 2013) through August 31, 2014, you will receive salary payments at the annual base salary rate you are receiving as of the Separation Date, less applicable withholdings and payroll deductions, paid in accordance with American Greetings’ payroll practices in the ordinary course.

c. Health Care. From the Separation Date through August 31, 2014, you will continue to receive health care coverage concurrently with COBRA in the plan in which you are enrolled as of the Separation Date at the associate payroll deduction rate as it may be changed from time-to-time. Beginning on September 1, 2014, you will be eligible for continued health care coverage through the remainder of your COBRA eligibility, if any, but at the full COBRA premium.

d. Stock Options and Contingent Payment.

(1) Stock Options. As of the date hereof, your previously granted stock options are fully vested and, subject to the terms of the plan and agreements governing your stock options, will remain vested as of the Separation Date and will remain exercisable until and including May 29, 2013 (the “Option Expiration Date”), which is the ninetieth (90th) day following the Separation Date. You also acknowledge and agree that any previously granted, vested stock options that remain outstanding on the Option Expiration Date will be automatically forfeited (the “Forfeited Options”).

(2) Contingent Payment. Notwithstanding the foregoing, if on or prior to the Option Expiration Date the Transaction (as defined below) has not been consummated or has not otherwise been withdrawn or terminated, then if the Transaction is consummated on or before August 31, 2013, American Greetings will take such action as is necessary to ensure that you receive the consideration that would have been payable to you under the terms of the Transaction (if any) with respect to your Forfeited Options had your Forfeited Options not terminated on the Option Expiration Date, but remained outstanding as of date the Transaction is consummated. For purposes hereof, the “Transaction” shall mean the transaction contemplated by the non-binding proposal, dated September 25, 2012, from Zev Weiss and Jeffrey Weiss on behalf of themselves and certain other members of the Weiss family and related parties, to acquire all of the outstanding Class A and Class B common shares of the American Greetings Corporation not currently owned by them.

e. Performance Share Program. As of the date hereof, you have been credited, but not vested in, 12,000 Class A common shares (the “Credited Shares”) of American Greetings in accordance with and subject to the terms and conditions of the American Greetings Performance Share Program, and your June 26, 2009 Performance Share Grant Agreement. Promptly following the Separation Date, and subject to standard tax withholdings, you will be issued 12,000 fully vested and unrestricted Class A common shares (or such lesser amount to the extent that you elect to have shares withheld to pay taxes due on the vesting of such shares), which amount represents 100% of the Credited Shares that were scheduled to vest on February 28, 2013. All other Credited Shares, together with any other performance shares that have not otherwise credited or vested under your June 26, 2009 Performance Share Grant Agreement, shall automatically terminate and be cancelled on the Separation Date.

f. Performance Share Program – FY 2013 – 2015. You will be eligible to earn performance shares under the May 25, 2012 grants for the FY 2013 performance period, based on actual FY 2013 performace and subject to the time vesting provisions of that program. You will not be eligible to receive any performance shares under the May 25, 2012 grant for the FY 2013 to 2014 performance period or for the FY 2013 to 2015 performance period, all of which shall automatically terminate and be cancelled as of the Separation Date.

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g. Restricted Stock Units (RSU’s). As of the date hereof, you have the following two separate, unvested RSU grants outstanding: 4,400 Class A RSU’s granted on May 3, 2011 (the “2011 RSU Grant”), and 13,266 Class A RSU’s granted on May 2, 2012 (the “2012 RSU Grant”). Promptly following the Separation Date, and subject to standard tax withholdings, you will be issued 3,629 fully vested and unrestricted Class A common shares (or such lesser amount to the extent that you elect to have shares withheld to pay taxes due on the vesting of such shares), representing a pro-rated amount of your 2011 RSU Grant. The remaining unvested units under the 2011 RSU Grant will shall automatically terminate and be cancelled as of the Separation Date. Your 2012 RSU Grant will continue to vest in accordance with its terms, such that, subject to the terms of such grant and subject to standard tax withholdings, on or around each of May 2, 2013 and May 2, 2014, you will be issued 6,633 fully vested and unrestricted Class A common shares (or such lesser amount to the extent that you elect to have shares withheld to pay taxes due on the vesting of such shares). Additionally, with respect to the 13,266 shares associated with the 2012 RSU Grant, you acknowledge that, on the Separation Date, you will be responsible for the payment of FICA taxes, which may be settled through American Greetings by way of personal check or payroll withholding.

h. Key Management Incentive Plan Eligibility. You will be eligible to participate in American Greetings’ Key Management Annual Incentive Plan for fiscal year 2013 at a “Meets Expectations” evaluation level for purposes of determining level of bonus payment. Payment, if any, will be made on the date in 2013 on which bonuses are otherwise payable to active employees thereunder, but in no event later than December 31, 2013.

i. Supplemental Executive Retirement Plan. For purposes of the American Greetings Supplemental Executive Retirement Plan, calculation of your accrued benefit thereunder shall be calculated based on February 28, 2013 as the date of your separation of service and, subject to the terms thereof, will be payable commencing upon your attaining the age of fifty-five.

j. Outplacement. American Greetings will pay for up to six (6) months of outplacement services to assist you in seeking employment. At the end of such six month period, if you are continuing to actively use the outplacement services made available to you, American Greetings will continue to pay for such services on a month-to-month basis, for up to an additional six (6) months. American Greetings will select the service provider and will make direct payments to the service provider.

k. Life Insurance and AD&D Coverage. You will continue to be covered under the American Greetings Executive Life Insurance Plan through August 31, 2014, which, subject to the terms therein, provides company paid coverage of two times your base salary as of your separation date. In addition, you will continue to be covered under the American Greetings supplemental accidental death and dismemberment policy through August 31, 2014, which, subject to the terms therein, provides company paid coverage of two times your base salary as of your separation date, not to exceed an aggregate of $1,000,000.

l. Computer and cell phone. During the period from your Separation Date until February 28, 2014, American Greetings will provide you the use of a laptop computer and cell phone.

3. Additional Benefits Contingent on Signing A Supplemental Release After Separation. In addition to the foregoing, if you sign the Supplemental Release attached hereto as Exhibit A after February 28, 2013 and it becomes effective, you will be eligible to continue to receive a car allowance of $1,250 per month, for 12 months, through February 28, 2014. If you fail to sign the Supplemental Release or you revoke it before it becomes effective, you will not be eligible to receive this additional benefit, but such failure or revocation shall not affect the enforceability of the terms and conditions contained in this Separation Agreement and Release once it becomes effective.

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4. Reasonable Cooperation. You acknowledge and agree that your agreement to fully cooperate with American Greetings with respect to the provisions of this Section 4 in its entirety is a material term of this Separation and Release Agreement. The failure by you to cooperate fully with American Greetings is a material breach of this Separation and Release Agreement.

a. Transfer of job responsibilities. As directed by American Greetings’ management, you shall fully cooperate in transferring to designated employees all of your responsibilities and duties.

b. Fiduciary Obligations. You acknowledge and agree that at all times until and through the Separation Date, you will carry out your duties in a manner consistent with and in compliance with all present and future requirements of: (i) applicable federal and state laws and regulations; (ii) American Greetings’ policies and procedures; and (iii) the directives and instructions of American Greetings’ management. You acknowledge and fully understand that you have a fiduciary relationship with American Greetings and, as a fiduciary, you are under an obligation to use due care and act in the best interest of American Greetings at all times.

c. Legal matters. You agree to cooperate with American Greetings and its attorneys as may be reasonably required concerning any past, present or future legal matters that relate to or arise out of your employment with American Greetings, with the understanding that any meetings you are required to attend are scheduled at mutually agreeable times. You acknowledge that you have advised American Greetings’ General Counsel of all facts of which you are aware that constitute or might constitute violations of the American Greetings’ Code of Business Conduct, ethical standards or legal obligations. American Greetings agrees to reimburse you for any and all reasonable costs and expenses (including but not limited to reasonable attorneys’ fees) you may incur in connection with such cooperation, with such reimbursement to occur no later than the end of the taxable year following the taxable year in which such expense was incurred.

d. Indemnification. You shall be indemnified for acts and omissions occurring on or prior to the Separation Date to the fullest extent permitted under applicable law. You shall be covered under American Greetings’ directors’ and officers’ liability insurance policies in effect on the same basis that other former directors and officers are covered for acts and omissions occurring prior to separation.

5. Acknowledgment of Separation. You acknowledge and agree that as of the Separation Date, or upon the date you are separated from service if earlier than the Separation Date, you will cease to be an employee of American Greetings and that the only benefits you will receive from American Greetings are those described in this Agreement; provided, however, that except as expressly set forth herein, this Agreement does not waive any vested benefits you may be eligible to receive as of the Separation Date under American Greetings’ compensation and benefit plans. You acknowledge and agree that the terms and conditions of this Agreement are intended by you and American Greetings to supersede all benefits payable to you upon termination by any other written or oral agreement, including but not limited to the Original Agreement you executed with American Greetings, and that as of the Separation Date, any other written or oral agreement will no longer have any force and effect.

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6. Waiver and Release of Employment Claims. In consideration of the promises made by American Greetings in this Separation and Release Agreement, you, for yourself, your family, heirs, executors, administrators, personal representatives, agents, employees, assigns, legal representatives and accounts, affiliates and for any partnerships, corporations, sole proprietorships, or other entities owned or controlled by you, agree to waive and release American Greetings, its past, present, and future officers, directors, shareholders, agents, representatives, insurers, employees, attorneys, subsidiaries, affiliated corporations, successors and assigns, from any and all claims, causes of action, and liabilities of any kind, known or unknown, in law or in equity, that you had or have as of the Effective Date (as defined below) of this Separation and Release Agreement, and that are in any way connected with or arise out of you employment or the termination of your employment with American Greetings, including but not limited to claims, causes of action, and liabilities involving:

a. Discrimination, retaliation or harassment based on race, color, religion, gender, gender identity, pregnancy, national origin, ancestry, citizenship, age, marital status, health or medical condition, leave of absence usage, disability, sexual orientation, veteran or military status, or any other protected status under any federal, state or local laws, including but not limited to claims of discrimination, harassment or retaliation under the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans With Disabilities Act, the Equal Pay Act, the Pregnancy Discrimination Act, the Family and Medical Leave Act, the Employee Retirement Income Security Act, the Immigration Reform and Control Act, the Occupational Safety and Health Act, and/or any other state, federal, local or municipal statute, regulation, rule or order that relates to your employment or its termination;

b. Any other employment related claim whatsoever including but not limited to, claims relating to wrongful termination, breach of contract (express or implied), breach of implied covenant of good faith and fair dealing, misrepresentation (intentional, fraudulent or negligent), estoppel, public policy violation, whistleblowing, defamation, infliction of emotional distress (intentional or negligent), negligence, personal injury of any kind and invasion of privacy.

c. Excluded from this Separation and Release Agreement are any claims that cannot be released or waived by law, including but not limited to workers’ compensation claims and the right to file a charge with or participate in an investigation conducted by certain government agencies. You acknowledge and agree, however, that you are releasing and waiving your right to any monetary recovery should any government agency pursue any claims on your behalf that arose prior to the Effective Date of this Separation and Release Agreement. Except as expressly set forth in this Separation and Release Agreement, you are not waiving or releasing any of your employee benefits that have already vested according to the terms of American Greetings’ benefits plans.

d. You agree that you have been properly paid for all hours worked, have not suffered any on-the-job injury for which you have not already filed a claim and that you have been properly provided any needed family or medical leaves of absence.

7. Release of Other Claims. In further consideration of the promises made by American Greetings in this Separation and Release Agreement, you, for yourself, your family, heirs, executors, administrators, personal representatives, agents, employees, assigns, legal representatives and accounts, affiliates and for any partnerships, corporations, sole proprietorships, or other entities owned or controlled by you, fully release, acquit, and forever discharge American Greetings, its past, present, and future officers, directors, shareholders, agents, representatives, insurers, employees, attorneys, subsidiaries, affiliated corporations, and assigns, from any and all actions, causes of action, claims, grievances, damages, obligations, suits, agreements, costs, expenses, attorneys’ fees, punitive or compensatory damages, back pay or any other liability of any kind whatsoever of which you have knowledge as of the time you sign this Separation and Release Agreement.

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8. No Future Lawsuits. You promise never to file a lawsuit, demand, action, or otherwise assert any claims against American Greetings referenced in paragraphs 6 or 7 of this Separation and Release Agreement. The foregoing sentence shall be construed as a covenant not to sue. This Separation and Release Agreement may be introduced as evidence at any legal proceeding as a complete defense to any claims you ever assert against American Greetings.

9. Construction of the Agreement.

a. This Agreement has been negotiated and drafted by mutual agreement of both parties and, accordingly, none of the provisions shall be construed more strongly in favor of or against either party.

b. This Agreement shall bind and inure to the benefit of and be enforceable by you, your respective heirs, executors, personal representatives, successors and permitted assigns.

10. Confidentiality of this Agreement. You agree not to disclose, or discuss with, any person (other than your spouse, attorney, tax or other financial advisor) any of the terms and/or conditions of this Agreement, except as may be required to notify a potential employer of your confidentiality, non-competition and non-solicitation obligations. Except as permitted in this Section 10, disclosure of any term and/or condition of this Agreement is a material breach of this Agreement. American Greetings also agrees to keep the terms of this Agreement as confidential as practicable and exercise reasonable efforts to limit disclosure of the Agreement to those with a business reason to know or as otherwise required by law.

11. Confidentiality & Non-Disclosure. You acknowledge that you have an obligation of confidence and non-disclosure with respect to any and all confidential information and trade secrets that you acquired during the course of employment with American Greetings. This obligation of confidence and non-disclosure extends to both American Greetings’ information and third-party information held by American Greetings in confidence, and this obligation continues after the Separation Date. You are prohibited from using or disclosing such information. You agree that you will not accept or become employed or retained in any capacity whatsoever by any person or entity where such employment or other capacity requires you to disclose or use confidential information, or where such employment or other capacity will, or may cause or reasonably lead to, the inevitable, necessary or effective disclosure or use of confidential information whether through express, implicit, indirect, intentional or unintentional means. You also agree that you will return to American Greetings any and all American Greetings’ property and information that came into your possession, or which you prepared or helped prepare, in connection with or during your employment. You will not retain any copies of such property or information.

12. Non-Competition & Non-Solicitation. Unless you have prior written permission from American Greetings’ Chief Executive Officer, General Counsel or Senior Vice President of Human Resources, you agree that for the eighteen- month period from February 28, 2013 through August 31, 2014, you shall not: a) be employed directly or indirectly, in any capacity for, or work as a consultant or independent contractor for, or financially support in any manner, any person, firm, corporation or entity in the United States, United Kingdom, Canada or Mexico, which designs or manufactures or social expression products that are substantially similar in nature to the social expression products designed and manufactured by American Greetings, or any of its related entities; and/or b) solicit (directly or indirectly) any American Greetings’ employee to enter into employment, directly or indirectly, in any capacity, or work as a consultant or independent contractor for any person, firm, corporation or entity in the United States, United Kingdom, Canada or Mexico, which designs or manufactures social expression products that are substantially similar in nature to the social expression products designed or manufactured by American Greetings, or any of its related entities. You acknowledge and agree that the remedy at law available to American Greetings for breach by you of any of the obligations under Sections 11 and/or 12 of this Agreement would be inadequate and that

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damages flowing from such a breach would not readily be susceptible to being measured in monetary terms. Accordingly, you acknowledge, consent and agree that, in addition to any other rights or remedies that American Greetings may have at law, in equity or under this Agreement, upon adequate proof of your violation of any provision of Sections 11 and/or 12 of this Agreement, American Greetings will be entitled to immediate injunctive relief and may obtain a temporary order restraining any threatened or further breach, without the necessity of proof of actual damage.

13. Non-Disparagement. You agree not to disparage or denigrate American Greetings, its directors, executive officers, employees, products or services orally or in writing.

14. No Admission of Liability. The offering, undertaking or signing of this Agreement are not in any way an acknowledgment or admission that you, American Greetings, or any person acting on behalf of American Greetings, has: a) violated or failed to comply with federal, state or local statute, law, regulation, rule or ordinance; or b) failed to comply with any of American Greetings’ policies or procedures.

15. Representations & Warranties. You represent and warrant that you have no interest or obligation that is inconsistent with or in conflict with this Agreement or that would prevent, limit or impair your performance of any part of this Agreement. You represent that as of the date you have signed this Agreement, you have not filed, directly or indirectly, nor caused to be filed, any claim, charge or cause of action against American Greetings in any forum, including federal, state or local court or in arbitration, any administrative proceeding with any federal, state or local administrative agency. You agree that should any administrative or third party pursue any claims on your behalf, you waive your right to any monetary or recovery of any kind.

16. Breach of Agreement. You agree that in the event you breach any of the terms of this Agreement, you will forfeit the benefits described in this Agreement, plus you will pay any expenses or damages incurred by American Greetings and/or each of its agents, officers, directors, employees, subsidiaries, divisions, affiliates, successors and assigns as a result of the breach, including reasonable attorneys’ fees.

17. Dispute Resolution. All disputes, claims, or controversies arising out of or in connection with this Agreement, your employment or its termination, including but not limited to those concerning workplace discrimination and all other statutory claims, shall exclusively be submitted to and determined by final and binding arbitration before a single arbitrator (“Arbitrator”) of the American Arbitration Association (“AAA”) in accordance with the association’s then current rules for the resolution of employment disputes (the “Rules”). The Arbitrator shall be selected in accordance with the Rules. The parties consent to the authority of the arbitrator, if the arbitrator so determines, to award fees and expenses (including attorneys’ fees) to the prevailing party in the arbitration. The following claims are not covered by this arbitration agreement: (i) claims you may have for workers’ compensation and unemployment compensation benefits; and (ii) claims by either party for injunctive and/or other equitable relief, including without limitation the enforcement of Sections 11 and/or 12, as to which you understand and agree that American Greetings may seek and obtain relief from a court of competent jurisdiction. You understand that the benefits set forth in this Agreement and your employment with American Greetings through the Separation Date are, in part, consideration for your acceptance of this arbitration provision. In addition, the promises by American Greetings and by you to arbitrate claims rather than litigate them before courts or other bodies provide consideration for each other.

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18. Entire Agreement. This Agreement constitutes the entire understanding between you and American Greetings relating to the subject matter contained herein. This Agreement may not be changed, modified, or altered without the express written consent of you and a senior officer of American Greetings. American Greetings’ failure to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of, or deprive American Greetings of its right thereafter to insist upon strict adherence to that term or any other term of this Agreement. To be effective, any waiver must be in writing and signed by a senior officer of American Greetings.

19. Governing Law, Severability.

a. This Agreement shall be construed in accordance with the laws of the State of Ohio.

b. It is expressly understood and agreed that if a final determination is made by a court of law that the time or any other restriction contained in Section 12 is an unenforceable restriction against you, then the provisions of Sections 12 above shall not be rendered void but shall be deemed amended to apply as to such maximum time and to such other maximum extent as such court may determine or indicate to be enforceable.

c. If a court of competent jurisdiction declares that any other provision or term of this Agreement is void or invalid, only the term, condition, clause, or provision that is determined to be void or invalid shall be stricken from the Agreement and it shall not affect the remaining provisions of this Agreement, which shall remain in full force and effect.

20. Time for Consideration of this Agreement.

a. From the date you receive this Separation and Release Agreement, which appears on page one above, you acknowledge and agree that you have had at least twenty-one (21) calendar days to consider and sign it. You can sign the Separation and Release Agreement at any time before the expiration of the 21-day period, but if you do so, you acknowledge that you have done so voluntarily and of your own free will, without duress or coercion. Any changes to this Separation and Release Agreement, whether material or immaterial, do not restart the running of the 21-day period. If you do not submit a signed copy of this Separation and Release Agreement on or before the 22nd day after you received it, American Greetings’ offer shall be withdrawn. You are hereby advised and encouraged to consult an attorney prior to signing this Separation and Release Agreement if you desire to do so. You acknowledge that if you have signed this Agreement without consulting an attorney, you have done so knowingly and voluntarily.

b. You further acknowledge and agree that you will not sign the Supplemental Release attached as Exhibit A until on or after the Separation Date; you are advised to consult with an attorney prior to signing the Supplemental Release; and you acknowledge and agree that you will have at least twenty-one (21) calendar days from the date you received this Agreement to review and consider your decision to sign the Supplemental Release.

21. Revocation of this Agreement. After you sign this Separation and Release Agreement, you have seven (7) calendar days to revoke your signature. If you revoke your signature, this Agreement shall not be effective or enforceable. Your revocation must be in writing, signed by you, and received by the Catherine M. Kilbane, Senior Vice President, General Counsel and Secretary, American Greetings Corporation, One American Road, Cleveland, Ohio, 44144, within seven (7) calendar days after you sign the Agreement, not including the day you received it. This Separation and Release Agreement shall be effective only after the 7-day period has expired without your revocation. This Separation and Release Agreement becomes effective on the eighth day after you sign it without revocation (“Effective Date”).

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22. Section 409A of the Internal Revenue Code of 1986 Compliance.

a. Section 409A of the Internal Revenue Code of 1986 Compliance. It is the intention and purpose of the parties that this Agreement and all payments and benefits hereunder shall be, at all relevant times, in compliance with (or exempt from) Code Section 409A and all other applicable laws, and this Agreement shall be so interpreted and administered. If necessary, any provision of this Agreement, or part thereof, that fails to comply with Section 409A shall be considered null and void. To the extent required by Code Section 409A, no benefits shall be paid under this Agreement during the six-month period following Employee’s Separation Date (the “Postponement Period”). If payment of benefits is required to be delayed for the Postponement Period under Code Section 409A, the accumulated amounts withheld on account of Code Section 409A shall be paid in a lump sum payment within thirty (30) days after the end of the Postponement Period and no interest or other adjustment shall be made for the delayed payment. If Employee dies during the Postponement Period prior to the payment of benefits, the amounts withheld on account of Code Section 409A shall be paid to Employee’s estate within sixty (60) days after Employee’s death.

b. This Agreement is intended to meet the requirements of the “short-term deferral” exception, the “separation pay” exception and other exceptions under Code Section 409A. Notwithstanding anything in the Agreement to the contrary, if required by Code Section 409A, payments may only be made under this Agreement upon an event and in a manner permitted by Code Section 409A, to the extent applicable. For purposes of Code Section 409A, any payment required to be made hereunder shall be treated as separate from any other payment or payments required to be made hereunder, and the right to a series of payments under the Agreement shall be treated as a right to a series of separate payments. For purposes of the Agreement, references to a “termination,” “termination of employment,” or like terms shall mean “separation from service” as defined under Code Section 409A to the extent applicable. All reimbursements and in-kind benefits provided under the Agreement shall be made or provided in accordance with the requirements of Code Section 409A, including, where applicable, the requirement that (i) any reimbursement is for expenses eligible for reimbursement during the period of time specified in the Agreement; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits provided in any other calendar year; (iii) the reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the expense is incurred; and (iv) the right to reimbursement or in-kind benefit is not subject to liquidation or exchange for another benefit. In no event may Employee designate the year of payment for any amounts payable under the Agreement.

23. Transferability. This Agreement shall be binding upon any successor to American Greetings, whether by merger, consolidation, purchase of assets or otherwise. No provision of this Agreement is intended to confer any rights, benefits, remedies, obligations or liability hereunder upon any person or entity, other than the parties hereto and their respective successors and assigns, which in your case will include your heirs and/or your estate.

Signed and Agreed to on behalf of American Greetings Corporation,

/s/    Brian McGrath        10/24/12

Brian McGrath, Senior Vice President of Human Resources

9

I ACKNOWLEDGE AND AGREE THAT I HAVE BEEN ADVISED THAT THIS SEPARATION AND RELEASE AGREEMENT IS A LEGAL DOCUMENT, AND HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY CONCERNING THIS SEPARATION AND RELEASE AGREEMENT. I ACKNOWLEDGE AND AGREE THAT I HAVE CAREFULLY READ AND FULLY UNDERSTAND ALL PROVISIONS OF THIS AGREEMENT, AND AM VOLUNTARILY AND KNOWINGLY SIGNING THE SEPARATION AND RELEASE AGREEMENT.

By:	/s/    Michael Goulder	Date:	10-18-12
	Michael Goulder

10

EXHIBIT A – SUPPLEMENTAL RELEASE FOR MICHAEL GOULDER

(To Be Executed After February 28, 2013)

The following is your Supplemental Release with American Greetings Corporation (together with its subsidiaries and affiliates referred to as “American Greetings”), regarding your employment with American Greetings and the termination thereof. This Supplemental Release is being provided as contemplated by Section 3 of that Separation and Release Agreement between American Greetings and you as of             , 2012 (the “Separation and Release Agreement”).

1. Additional Benefits. Upon your separation on February 28, 2013 and effective as of the Supplemental Release Effective Date (as defined below), you will be eligible to continue to receive a car allowance of $1,250 for 12 months, through February 28, 2014

2. Waiver and Release of Employment Claims. In consideration of the promises made by American Greetings in this Supplemental Release, you, for yourself, your family, heirs, executors, administrators, personal representatives, agents, employees, assigns, legal representatives and accounts, affiliates and for any partnerships, corporations, sole proprietorships, or other entities owned or controlled by you, agree to waive and release American Greetings, each of its past, present, and future officers, directors, shareholders, agents, representatives, insurers, employees, attorneys, subsidiaries, affiliated corporations, successors and assigns, from any and all claims, causes of action, and liabilities of any kind, known or unknown, in law or in equity, that you had or have as of the Supplemental Release Effective Date, and that are in any way connected with or arise out of your employment or the termination of your employment with American Greetings, including but not limited to claims, causes of action, and liabilities involving:

a. Discrimination, retaliation or harassment based on race, color, religion, gender, gender identity, pregnancy, national origin, ancestry, citizenship, age, marital status, health or medical condition, leave of absence usage, disability, sexual orientation, veteran or military status, or any other protected status under any federal, state or local laws, including but not limited to claims of discrimination, harassment or retaliation under the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans With Disabilities Act, the Equal Pay Act, the Pregnancy Discrimination Act, the Family and Medical Leave Act, the Employee Retirement Income Security Act, the Immigration Reform and Control Act, the Occupational Safety and Health Act, and/or any other state, federal, local or municipal statute, regulation, rule or order that relates to your employment or its termination;

b. Any other employment related claim whatsoever including but not limited to, claims relating to wrongful termination, breach of contract (express or implied), breach of implied covenant of good faith and fair dealing, misrepresentation (intentional, fraudulent or negligent), estoppel, public policy violation, whistleblowing, defamation, infliction of emotional distress (intentional or negligent), negligence, personal injury of any kind and invasion of privacy.

c. Excluded from this Supplemental Release are any claims that cannot be released or waived by law, including but not limited to workers’ compensation claims and the right to file a charge with or participate in an investigation conducted by certain government agencies. You acknowledge and agree, however, that you are releasing and waiving your right to any monetary recovery should any government agency pursue any claims on your behalf that arose prior to the Supplemental Release Effective Date. Except as otherwise expressly agreed, you are not waiving or releasing any of your employee benefits that have already vested according to the terms of American Greetings’ benefits plans.

1

d. You agree that you have been properly paid for all hours worked, have not suffered any on-the-job injury for which you have not already filed a claim and that you have been properly provided any needed family or medical leaves of absence.

3. Release of Other Claims. In further consideration of the promises made by American Greetings in this Supplemental Release, you, for yourself, your family, heirs, executors, administrators, personal representatives, agents, employees, assigns, legal representatives and accounts, affiliates and for any partnerships, corporations, sole proprietorships, or other entities owned or controlled by you, fully release, acquit, and forever discharge American Greetings, its past, present, and future officers, directors, shareholders, agents, representatives, insurers, employees, attorneys, subsidiaries, affiliated corporations, and assigns, from any and all actions, causes of action, claims, grievances, damages, obligations, suits, agreements, costs, expenses, attorneys’ fees, punitive or compensatory damages, back pay or any other liability of any kind whatsoever of which you have knowledge as of the time you sign this Supplemental Release.

4. No Future Lawsuits. You promise never to file a lawsuit, demand, action, or otherwise assert any claims against American Greetings referenced in paragraphs 6 or 7 of the Separation and Release Agreement. The foregoing sentence shall be construed as a covenant not to sue. This Supplemental Release may be introduced as evidence at any legal proceeding as a complete defense to any claims you ever assert against American Greetings.

5. Time for Consideration of this Supplemental Release. From the date you received this Supplemental Release, which appears on page one of the Separation and Release Agreement, you acknowledge and agree that you have had at least twenty-one (21) calendar days to consider and sign it. Any changes to this Supplemental Release, whether material or immaterial, do not restart the running of the 21-day period. You are hereby advised and encouraged to consult an attorney prior to signing this Supplemental Release if you desire to do so. You acknowledge that if you have signed this Supplemental Release without consulting an attorney, you have done so knowingly and voluntarily.

6. Revocation of this Supplemental Release. After you sign this Supplemental Release, you have seven (7) calendar days to revoke your signature. If you revoke your signature, this Supplemental Release shall not be effective or enforceable, although the above Separation and Release Agreement will continue be effective. Your revocation must be in writing, signed by you, and received by the Catherine M. Killable, Senior Vice President, General Counsel and Secretary, American Greetings Corporation, One American Road, Cleveland, Ohio, 44144, within seven (7) calendar days after you sign the Supplemental Release, not including the day you received it. This Supplemental Release shall be effective only after the 7-day period has expired without your revocation. This Supplemental Release becomes effective on the eighth day after you sign it without revocation (“Supplemental Release Effective Date”).

I ACKNOWLEDGE AND AGREE THAT I HAVE BEEN ADVISED THAT THIS SUPPLEMENTAL RELEASE IS A LEGAL DOCUMENT, AND I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY CONCERNING THIS AGREEMENT. I ACKNOWLEDGE AND AGREE THAT I HAVE CAREFULLY READ AND FULLY UNDERSTAND ALL PROVISIONS OF THIS SUPPLEMENTAL RELEASE, AND AM VOLUNTARILY AND KNOWINGLY SIGNING THE SUPPLEMENTAL RELEASE.

2

Michael Goulder	Date
American Greetings Corporation By: Brian McGrath Senior Vice President, Human Resources American Greetings Corporation		Date

3

EX-10.2

Exhibit 10.2

October 24, 2012

Rob Tyler

Chief Accounting Officer

American Greetings Corporation

1 American Road

Cleveland, Ohio 44144

Subject: Retention Bonus Agreement

Dear Rob:

As you know, the Weiss family has proposed buying all outstanding shares of American Greetings’ stock and converting the Company into a privately-held corporation. We understand that this is a significant development with the potential to impact your position and work on behalf of the Company. While we understand that this could be a time of concern and uncertainty for you, we want to encourage you to remain employed with American Greetings as the Company explores the possibility of this proposed transaction.

Accordingly, American Greetings Corporation, on behalf of its subsidiaries, affiliates, successors and assigns (“American Greetings” or “the Company”), is offering you (“you,” “Employee” or “Tyler”) the opportunity to enter into the following Retention Bonus Agreement (“Agreement”) with us, which will provide you with a financial incentive to remain actively employed with American Greetings. “This financial incentive is over and above the wages and benefits that will be provided to you in the ordinary course of your employment.”

If you choose to execute this Agreement, it will be effective on the date you sign it, This Agreement, by and between you and American Greetings, shall be in place for twelve (12) months, beginning on the date of execution, and at the conclusion of the 12-month period, it will expire. In consideration of the mutual promises made herein, you and American Greetings agree as follows:

1. Objective. American Greetings proposes this Agreement for the purpose of encouraging you to remain continuously employed with the Company from the present time through the closing of the transaction, or similar transaction, contemplated by the September 26, 2012 letter from Zev Weiss to the Board of Directors of American Greetings Corporation (“Transaction”), or June 1, 2013, whichever is earlier (the “Retention Date”). Accordingly, provided you comply with paragraph 7 herein and except as provided in paragraph 4 herein, American Greetings will guarantee your employment and/or compensation, at your base salary in effect as of the date you execute this Agreement and at the level of benefits provided to other associates at the executive director level, until June 1, 2013, except that the Key Manager Bonus Target will not be less than 40% of the base salary.

2. Amount of the Bonus. In consideration for complying with the terms and conditions of this Agreement, American Greetings will pay you a Retention Bonus (“Bonus”) in the total amount of $75,000, less all applicable payroll tax withholdings and deductions on June 1, 2013 or within 30 days following the close of the Transaction, whichever is earlier. This payment will be in addition to your normal compensation and in addition to any bonus which may be paid to you under American Greetings’ Key Management Incentive Plan. The retention bonus will be made regardless of whether the Transaction occurs or not.

3. Earning the Bonus. You will earn the Bonus described in paragraph 2 on the closing of the transaction or June 1, 2013, whichever is earlier. Except as provided in paragraph #6, you must be actively and continuously employed by American Greetings from now through the Retention Date to earn the Bonus. Because the purpose of this Agreement is to encourage continuity of service, the Bonus does not accrue and is not earned on a daily, pro rata basis. No portion of the bonus is earned prior to the Retention Date. For the purposes of this bonus, periods of time for which paid time off is provided, including vacation, sick leave, holidays and the like, are considered to be active service. If earned, the Bonus will be paid no later than one month following the Retention Date.

4. Effect of Termination or Resignation. If you resign from American Greetings for any reason or if your employment with American Greetings is terminated for cause, you will not earn any portion of the Bonus, nor will you be eligible for continued compensation through June 1, 2013 as described in Paragraph 1 above. For purposes of this Agreement, “cause” includes, but is not limited to failure to perform duties; failure to comply with Company policies; misconduct (including, but not limited to fraud, embezzlement, misappropriation, etc.); failure to follow directions of Company management; or habitual absence from work. For purposes of this Agreement, you acknowledge and agree that no resignation on your part, for any reason, will be construed as a “constructive” or “forced” termination by American Greetings.

5. No Contract for Continued Employment; At-Will Employment. Nothing contained in this Agreement creates an express or implied term of employment or an express or implied agreement to terminate for cause. Your employment remains terminable at-will, either by you or American Greetings, with or without cause.

6. Effect of Job Elimination or Position Reduction. In the event American Greetings eliminates your position during the term of this Agreement, or significantly reduces the scope of your job responsibilities to a level that is not reasonably considered to be at the level of an executive director and/or a chief accounting officer, American Greetings will provide you with either 1) ninety (90) days’ notice of job elimination or reduction, during which time you will be permitted to continue to work at the same level of salary and benefits in effect at the time; or 2) 90 days’ of salary and benefits continuation at the level in effect at the time. In addition, you will remain eligible for the bonus payment contemplated in paragraph 2 above and you will also be eligible for severance in accord with the terms of the severance plan applicable to vice presidents in effect at the time of separation.

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7. Best Efforts. American Greetings requires that at all times, you continue to give your best efforts and full-time attention to the business of American Greetings.

8. Confidentiality of this Agreement. You shall at all times keep confidential (except for disclosure to your spouse, accountant, financial advisor and/or attorney for the purpose of professional advice) the terms and conditions of this Agreement, unless required to disclose such confidential information by law.

9. Entire Agreement. This Agreement contains the entire understanding and Agreement regarding the Retention Bonus. There are no oral or other written agreements or understandings which directly or indirectly affect the Bonus described herein. You acknowledge and agree that American Greetings has made no promise, inducement, implied promise, pledge, or assurance regarding the Bonus that is not set forth in this Agreement. This Agreement shall not be modified in any respect except in writing and executed by all parties.

If this document is not returned to Steve Smith on or before the close of business on Nov 7, 2012, it is understood that you are declining in participating in this Retention Bonus Agreement.

You have received, read, and understand the contents of this Agreement. By signing below, you accept this Agreement and all of its terms.

/s/ Stephen J. Smith

Stephen Smith

Senior Vice President and Chief Financial Officer

AGREED:

/s/ Robert Tyler                                                       11/4/12

Rob Tyler                                                                     Date

3

EX-31.A

Exhibit 31 (a)

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Zev Weiss, certify that:

1. I have reviewed this quarterly report on Form 10-Q of American Greetings Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of American Greetings Corporation as of, and for, the periods presented in this report;

4. American Greetings Corporation’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for American Greetings Corporation and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to American Greetings Corporation, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of American Greetings Corporation’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in American Greetings Corporation’s internal control over financial reporting that occurred during American Greetings Corporation’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, American Greetings Corporation’s internal control over financial reporting; and

5. American Greetings Corporation’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to American Greetings Corporation’s auditors and the audit committee of American Greetings Corporation’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect American Greetings Corporation’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in American Greetings Corporation’s internal control over financial reporting.

January 2, 2013	/s/ Zev Weiss
	Zev Weiss
	Chief Executive Officer
	(principal executive officer)

EX-31.B

Exhibit 31 (b)

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Stephen J. Smith, certify that:

1. I have reviewed this quarterly report on Form 10-Q of American Greetings Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of American Greetings Corporation as of, and for, the periods presented in this report;

4. American Greetings Corporation’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for American Greetings Corporation and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to American Greetings Corporation, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of American Greetings Corporation’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in American Greetings Corporation’s internal control over financial reporting that occurred during American Greetings Corporation’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, American Greetings Corporation’s internal control over financial reporting; and

5. American Greetings Corporation’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to American Greetings Corporation’s auditors and the audit committee of American Greetings Corporation’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect American Greetings Corporation’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in American Greetings Corporation’s internal control over financial reporting.

January 2, 2013	/s/ Stephen J. Smith
	Stephen J. Smith
	Senior Vice President and
	Chief Financial Officer (principal financial officer)

EX-32

Exhibit 32

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with this quarterly report of American Greetings Corporation on Form 10-Q as filed with the Securities and Exchange Commission on the date therein specified (the “Report”), each of the undersigned certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of American Greetings Corporation.

January 2, 2013

/s/ Zev Weiss

Zev Weiss

Chief Executive Officer (principal executive officer)

/s/ Stephen J. Smith

Stephen J. Smith

Senior Vice President and

Chief Financial Officer (principal financial officer)

XML

Acquisition - Purchase Price Allocation (Detail) (Clinton Cards [Member], USD $) In Millions, unless otherwise specified	Nov. 23, 2012
Clinton Cards [Member]
Schedule Of Business Acquisitions Purchase Price Allocation [Line Items]
Credit bid	$ 37.2
Effective settlement of pre-existing supply agreement with the legacy Clinton Cards business	6.2
Cash acquired	(0.6)
Total purchase price	42.8
Inventory	16.2
Property, plant and equipment	20.0
Intangible assets	7.1
Current liabilities assumed	(0.5)
Total allocation	$ 42.8

XML

Debt (Detail) (USD $) In Thousands, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Debt Instrument [Line Items]
Long-term debt	$ 356,832	$ 225,181	$ 234,642
7.375% senior notes, due 2021 [Member]
Debt Instrument [Line Items]
Long-term debt	225,000	225,000
Credit Agreements [Member]
Debt Instrument [Line Items]
Long-term debt	131,651
7.375% senior notes, due 2016 [Member]
Debt Instrument [Line Items]
Long-term debt			213,864
7.375% notes, due 2016 [Member]
Debt Instrument [Line Items]
Long-term debt			20,597
6.10% senior notes, due 2028 [Member]
Debt Instrument [Line Items]
Long-term debt	$ 181	$ 181	$ 181

XML

Customer Allowances and Discounts - Additional Information (Detail) (Allowance for Doubtful Accounts [Member], USD $) In Millions, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Allowance for Doubtful Accounts [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Trade allowances and discounts settled in cash	$ 14.0	$ 13.7	$ 13.3

XML

Debt (Parenthetical) (Detail)	Nov. 23, 2012
7.375% senior notes, due 2021 [Member]
Debt Instrument [Line Items]
Interest rate of debt	7.375%
7.375% senior notes, due 2016 [Member]
Debt Instrument [Line Items]
Interest rate of debt	7.375%
7.375% notes, due 2016 [Member]
Debt Instrument [Line Items]
Interest rate of debt	7.375%
6.10% senior notes, due 2028 [Member]
Debt Instrument [Line Items]
Interest rate of debt	6.10%

XML

Loss Earnings Per Share - Additional Information (Detail) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options excluded from the computation of earnings per share-assuming dilution	3.7	3.7	3.7	2.4
Common Class A [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise of employee stock options	0	0.1	0.2	0.7
Common Class B [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise of employee stock options				0.3

XML

Fair Value Measurements (Tables)

9 Months Ended

Nov. 23, 2012

Assets and Liabilities Measured at Fair Value as of Measurement Date

The following table summarizes the financial assets measured at fair value as of November 23, 2012:

	November 23, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	10,177	$	10,177	$	—	$	—

The following table summarizes the financial assets measured at fair value as of February 29, 2012:

	February 29, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	9,198	$	9,198	$	—	$	—

The following table summarizes the financial assets measured at fair value as of November 25, 2011:

	November 25, 2011		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Active employees’ medical plan trust assets	$	3,312	$	3,312	$	—	$	—
Deferred compensation plan assets (1)		8,719		8,719		—		—
Total	$	12,031	$	12,031	$	—	$	—

(1) There is an offsetting liability for the obligation to its employees on the Corporation’s books.

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Retirement Benefits - Additional Information (Detail) (USD $) In Millions, unless otherwise specified				9 Months Ended		3 Months Ended		9 Months Ended
	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011	Nov. 23, 2012 Domestic [Member] Profit Sharing [Member]	Nov. 25, 2011 Domestic [Member] Profit Sharing [Member]	Nov. 23, 2012 Domestic [Member] Defined Contribution Plan [Member]	Nov. 25, 2011 Domestic [Member] Defined Contribution Plan [Member]	Nov. 23, 2012 Domestic [Member] Defined Contribution Plan [Member]	Nov. 25, 2011 Domestic [Member] Defined Contribution Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Corporate contributions to the profit sharing plan				$ 3.9	$ 6.3	$ 2.3	$ 1.9	$ 4.9	$ 4.5
Liability for postretirement benefits other than pensions	28.6	24.8	29.9
Long-term liability for pension benefits	$ 75.7	$ 75.7	$ 59.8

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Royalty Revenue and Related Expenses (Tables)

9 Months Ended

Nov. 23, 2012

Royalty Revenue and Related Expenses

Expenses associated with the servicing of these agreements, primarily relating to the licensing activities included in non-reportable segments, are summarized as follows:

	Three Months Ended				Nine Months Ended
(In thousands)	November 23, 2012		November 25, 2011		November 23, 2012		November 25, 2011
Royalty revenue	$	7,085	$	6,401	$	17,947	$	20,785
Royalty expenses
Material, labor and other production costs	$	2,794	$	2,789	$	7,795	$	7,781
Selling, distribution and marketing expenses		1,856		2,621		5,235		7,345
Administrative and general expenses		467		431		1,330		1,292
	$	5,117	$	5,841	$	14,360	$	16,418

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Inventories - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Inventories [Line Items]
Inventory held on location for retailers with SBT arrangements, which is included in finished products	$ 72.5	$ 52.0	$ 61.5

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Other Income (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011	May 25, 2012 AG Intellectual Properties [Member]	Aug. 26, 2011 AG Intellectual Properties [Member]	Nov. 23, 2012 AG Intellectual Properties [Member]	Nov. 25, 2011 AG Intellectual Properties [Member]
Other Income Expense [Line Items]
Gain on sale of intellectual properties				$ (4,500)		$ (4,500)		$ (4,500)
Termination of certain agency agreements					2,100		2,125
Miscellaneous	(2,217)	(813)	(3,546)	(2,358)
Other operating income - net	$ (2,217)	$ (813)	$ (1,421)	$ (6,858)

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Acquisition - Comparative Amounts in Prior Year Period (Detail) (USD $)	9 Months Ended		3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Aug. 24, 2012 Clinton Cards [Member]	May 25, 2012 Clinton Cards [Member]	Nov. 23, 2012 Clinton Cards [Member]	Nov. 23, 2012 Clinton Cards [Member] Net Sales [Member]	Nov. 23, 2012 Clinton Cards [Member] General and Administrative Expense [Member]	Nov. 23, 2012 Clinton Cards [Member] Other Non-Operating Expense [Member]
Schedule Of Activities And Transactions Associated With Related Cost [Line Items]
Contract asset impairment				$ 4,000,000	$ 4,000,000	$ 4,000,000
Bad debt expense	17,771,000	4,879,000		17,200,000	17,200,000		17,200,000
Legal and advisory fees					6,300,000		6,300,000
Impairment of debt purchased	10,043,000		2,200,000	7,800,000	10,000,000			10,000,000
Total					$ 37,500,000	$ 4,000,000	$ 23,500,000	$ 10,000,000

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Deferred Costs - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Deferred Costs and Future Payment Commitment for Retail Supply Agreements [Line Items]
Allowance for deferred costs related to supply agreements	$ 7.8	$ 10.0	$ 10.0

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Business Segment Information - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Segment Reporting Information [Line Items]
Severance accrual	$ 4.7	$ 6.8	$ 3.8
United Kingdom [Member]
Segment Reporting Information [Line Items]
Number of card and gift retail stores	400

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Customer Allowances and Discounts (Detail) (USD $) In Thousands, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	$ 112,637	$ 104,068	$ 122,639
Allowance for Seasonal Sales Returns [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	35,506	34,285	47,496
Allowance For Outdated Products [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	11,850	10,976	9,937
Allowance for Doubtful Accounts [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	5,670	4,480	7,031
Allowance for Marketing Funds [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	29,599	26,679	29,710
Allowance For Rebates [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowances and discounts on trade accounts receivables	$ 30,012	$ 27,648	$ 28,465

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Acquisition

9 Months Ended

Nov. 23, 2012

Acquisition

Note 4—Acquisition

During the first quarter of 2013, the Corporation acquired all of the outstanding senior secured debt of Clinton Cards for $56.6 million (£35 million) through Lakeshore Lending Limited (“Lakeshore”), a wholly-owned subsidiary of the Corporation organized under the laws of the United Kingdom. Subsequently, on May 9, 2012, Clinton Cards was placed into administration, a procedure similar to Chapter 11 bankruptcy in the United States. Prior to entering into administration, Clinton Cards had approximately 750 stores and annual revenues of approximately $600 million across its two primary retail brands, Clinton Cards and Birthdays. The legacy Clinton Cards business had been an important customer to the Corporation’s international business for approximately forty years and was one of the Corporation’s largest customers.

As part of the administration process, the administrators (“Administrators”) of Clinton Cards and certain of its subsidiaries (the “Sellers”) conducted an auction of certain assets of the business of the Sellers that they believed constituted a viable ongoing business. Lakeshore bid $37.2 million (£23 million) for certain of these remaining

assets. The bid took the form of a “credit bid,” where the Corporation used a portion of the outstanding senior secured debt owed to Lakeshore by Clinton Cards to pay the purchase price for the assets. The bid was accepted by the Administrators and on June 6, 2012, through its wholly-owned subsidiaries, UK Greetings Limited and Lakeshore, the Corporation entered into an agreement with the Sellers and the Administrators for the purchase of certain assets and the related business of the Sellers.

Under the terms of the agreement, the Corporation expects to acquire approximately 400 stores from the Sellers, together with related inventory and overhead, as well as the Clinton Cards and related brands. The Corporation will operate the acquired stores through a subsidiary of Lakeshore, AG Retail Cards Limited. The asset acquisition is expected to result in a net increase in the Corporation’s annual revenues of approximately $265 million, although the final number will depend on the ultimate number of stores acquired, which is subject to further negotiations with landlords at each respective location. The landlords must generally consent to the assignment of the leases for such stores on terms that are acceptable to the Corporation. If the Corporation cannot negotiate acceptable lease assignments, or if the applicable landlord withholds consent to the assignment of its store lease, then the Corporation may close the store, the store lease will be placed back into the administration process, and the Sellers will be responsible for any further obligations under the store lease. Based on current negotiations, as of November 23, 2012, the Corporation has completed 185 lease assignments. Assuming that the remaining landlords consent to terms proposed by the Corporation and the Corporation is able to successfully complete assignment for all of the approximately 400 stores, as of November 23, 2012, we anticipate the estimated future minimum rental payments for noncancelable operating leases related to acquired stores will be approximately $367 million.

The stores and assets not acquired by the Corporation remain part of the administration process. It is anticipated that these remaining assets not purchased by the Corporation will be liquidated and proceeds will be used to repay the creditors of the Sellers, including the Corporation. The Corporation will seek to recover the $19.4 million (£12 million) remaining senior secured debt claim held by it through the liquidation process. However, based on the estimated recovery information provided by the Administrators, the Corporation recorded an aggregate charge of $10.0 million, $7.8 million in the first quarter and $2.2 million in the second quarter, relating to the senior secured debt it acquired in the current year’s first fiscal quarter. The remaining balance of the senior secured debt, totaling approximately $9 million is included in “Prepaid expenses and other” on the Consolidated Statement of Financial Position. The liquidation process and the negotiations with landlords for stores included in the aforementioned acquisition, is expected to take approximately twelve months from the closing of the transaction on June 6, 2012.

Separate from the acquired senior secured debt, the Corporation had unsecured accounts receivable exposure to Clinton Cards. Based on the expected recovery shortfall on the senior secured debt described above, a majority of the unsecured accounts receivable is not expected to be collected. Accordingly, the Corporation recorded bad debt expense of $17.2 million relating to the unsecured accounts receivable. In addition, with the May 2012 announcement by the Administrators that all of Clinton Cards’ Birthdays branded retail stores would be liquidated, the Corporation recorded an impairment charge of $4.0 million for the deferred costs related to the Birthdays stores.

The charges incurred in the nine months ended November 23, 2012 associated with the aforementioned acquisition that do not have comparative amounts in the prior year nine month period are reflected on the Consolidated Statement of Operations as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
Net sales	$	4.0	$	—	$	—	$	—	$	4.0
Administrative and general expenses		—		17.2		6.3		—		23.5
Other non-operating (income) expense		—		—		—		10.0		10.0
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

These charges are reflected in the Corporation’s reportable segments as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
International Social Expression Products	$	4.0	$	17.2	$	—	$	—	$	21.2
Unallocated		—		—		6.3		10.0		16.3
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

The total cost of the acquisition has been allocated to the assets acquired and the liabilities assumed based upon their estimated fair values at the date of the acquisition. The estimated purchase price allocation is preliminary and subject to revision as valuation work and other analyses are still being conducted. The following represents the preliminary purchase price allocation:

Purchase price (in millions):
Credit bid	$	37.2
Effective settlement of pre-existing supply agreement with the legacy Clinton Cards business		6.2
Cash acquired		(0.6	)
	$	42.8
Allocation (in millions):
Inventory	$	16.2
Property, plant and equipment		20.0
Intangible assets		7.1
Current liabilities assumed		(0.5	)
	$	42.8

The financial results of this acquisition are included in the Corporation’s consolidated results from the date of acquisition. Pro forma results of operations have not been presented because the effect of this acquisition was not deemed material at the date of acquisition. The acquired business is included in the Corporation’s Retail Operations segment.

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Business Segment Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Segment Reporting Information [Line Items]
Total Revenue	$ 506,814	$ 465,007	$ 1,293,756	$ 1,238,897
Segment Earnings (Loss) before Tax	(2,099)	29,700	2,250	105,443
North American Social Expression Products [Member]
Segment Reporting Information [Line Items]
Total Revenue	333,852	333,305	908,267	902,333
Segment Earnings (Loss) before Tax	22,099	28,016	98,757	113,009
International Social Expression Products [Member]
Segment Reporting Information [Line Items]
Total Revenue	101,972	103,352	239,486	249,448
Segment Earnings (Loss) before Tax	3,413	9,537	(18,855)	15,308
Intersegment Items [Member]
Segment Reporting Information [Line Items]
Total Revenue	(25,538)		(39,080)
Segment Earnings (Loss) before Tax	(4,123)		(11,525)
International Social Expression Products and Intersegment Items, Net [Member]
Segment Reporting Information [Line Items]
Total Revenue	76,434	103,352	200,406	249,448
Segment Earnings (Loss) before Tax	(710)	9,537	(30,380)	15,308
Retail Operations [Member]
Segment Reporting Information [Line Items]
Total Revenue	67,635		107,519
Segment Earnings (Loss) before Tax	(11,473)		(16,579)
Ag Interactive [Member]
Segment Reporting Information [Line Items]
Total Revenue	15,982	16,878	47,255	49,664
Segment Earnings (Loss) before Tax	5,331	3,737	13,713	10,970
Non-Reportable Segments [Member]
Segment Reporting Information [Line Items]
Total Revenue	12,911	11,472	30,309	37,452
Segment Earnings (Loss) before Tax	3,259	2,368	5,501	17,467
Unallocated [Member]
Segment Reporting Information [Line Items]
Segment Earnings (Loss) before Tax	(20,605)	(13,958)	(68,762)	(51,311)
Unallocated [Member] | Interest Expense [Member]
Segment Reporting Information [Line Items]
Segment Earnings (Loss) before Tax	(4,504)	(5,853)	(13,314)	(17,708)
Unallocated [Member] | Profit Sharing Expense [Member]
Segment Reporting Information [Line Items]
Segment Earnings (Loss) before Tax	(423)	(1,078)	(3,852)	(6,308)
Unallocated [Member] | Stock-Based Compensation Expense [Member]
Segment Reporting Information [Line Items]
Segment Earnings (Loss) before Tax	(2,965)	(2,676)	(7,806)	(8,038)
Unallocated [Member] | Corporate Overhead Expense [Member]
Segment Reporting Information [Line Items]
Segment Earnings (Loss) before Tax	$ (12,713)	$ (4,351)	$ (43,790)	$ (19,257)

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Other Income and Expense - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended	1 Months Ended	3 Months Ended		9 Months Ended	3 Months Ended		9 Months Ended		6 Months Ended	9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011	Aug. 24, 2012 Clinton Cards [Member]	May 25, 2012 Clinton Cards [Member]	Nov. 23, 2012 Clinton Cards [Member]	Jul. 27, 2012 Part City Holdings, Inc [Member]	Nov. 23, 2012 Part City Holdings, Inc [Member]	Aug. 24, 2012 Part City Holdings, Inc [Member]	Nov. 23, 2012 Part City Holdings, Inc [Member]	May 25, 2012 AG Intellectual Properties [Member]	Aug. 26, 2011 AG Intellectual Properties [Member]	Nov. 23, 2012 AG Intellectual Properties [Member]	Nov. 25, 2011 AG Intellectual Properties [Member]	Aug. 26, 2011 International Social Expression Products [Member]	Nov. 25, 2011 International Social Expression Products [Member]
Other Income Expense [Line Items]
Contract Termination												$ (2,100,000)		$ (2,125,000)
Gain on sales of minor character properties				4,500,000									4,500,000		4,500,000
Proceeds from sale of intellectual properties				4,500,000									4,500,000
Gain on sale of investment	1,141,000		4,293,000					3,152,000	1,100,000	3,200,000	4,300,000
Miscellaneous Loss related to senior secured debt			10,043,000		2,200,000	7,800,000	10,000,000
Gain on sales of land, building	(240,000)	323,000	(394,000)	807,000												500,000	400,000
Cash proceeds from sales of assets																$ 2,400,000	$ 6,000,000

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Inventories (Tables)

9 Months Ended

Nov. 23, 2012

Inventories

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Raw materials	$	18,803	$	17,565	$	16,912
Work in process		7,051		9,452		8,294
Finished products		302,101		242,767		251,213
		327,955		269,784		276,419
Less LIFO reserve		82,976		81,077		81,515
		244,979		188,707		194,904
Display materials and factory supplies		19,351		20,238		19,508
	$	264,330	$	208,945	$	214,412

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Customer Allowances and Discounts (Tables)

9 Months Ended

Nov. 23, 2012

Allowances and Discounts on Trade Accounts Receivable

Trade accounts receivable is reported net of certain allowances and discounts. The most significant of these are as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Allowance for seasonal sales returns	$	35,506	$	34,285	$	47,496
Allowance for outdated products		11,850		10,976		9,937
Allowance for doubtful accounts		5,670		4,480		7,031
Allowance for marketing funds		29,599		26,679		29,710
Allowance for rebates		30,012		27,648		28,465
	$	112,637	$	104,068	$	122,639

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Retirement Benefits - Components of Periodic Benefit Cost for Defined Benefit Pension and Postretirement Benefit Plans (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 386	$ 206	$ 1,053	$ 621
Interest cost	1,864	2,127	5,547	6,418
Expected return on plan assets	(1,632)	(1,655)	(4,854)	(4,998)
Amortization of prior service cost	61	61	184	184
Amortization of actuarial loss (gain)	1,005	557	2,636	1,684
Defined Benefit Plan, Net Periodic Benefit Cost, Total	1,684	1,296	4,566	3,909
Postretirement Benefit Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	88	363	513	1,088
Interest cost	531	1,210	2,131	3,630
Expected return on plan assets	(893)	(1,098)	(2,573)	(3,293)
Amortization of prior service cost	(519)	(638)	(1,557)	(1,913)
Amortization of actuarial loss (gain)	(339)		(339)
Defined Benefit Plan, Net Periodic Benefit Cost, Total	$ (1,132)	$ (163)	$ (1,825)	$ (488)

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Other Income and Expense (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Component of Operating Other Cost and Expense [Line Items]
Gain on sale of Party City investment	$ (1,141)		$ (4,293)
Foreign exchange gain	(552)	(1,500)	(948)	(631)
Rental income	(450)	(238)	(1,496)	(977)
Loss (gain) on asset disposal	240	(323)	394	(807)
Miscellaneous	(1)	(16)	(177)	(206)
Other non-operating (income) expense - net	(1,904)	(2,077)	3,523	(2,621)
Clinton Cards [Member]
Component of Operating Other Cost and Expense [Line Items]
Loss on Clinton Cards debt			$ 10,043

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Deferred Costs (Tables)

9 Months Ended

Nov. 23, 2012

Deferred Costs and Future Payment Commitments

Deferred costs and future payment commitments for retail supply agreements are included in the following financial statement captions:

(In thousands)	November 23, 2012			February 29, 2012			November 25, 2011
Prepaid expenses and other	$	98,211		$	94,071		$	93,553
Other assets		346,056			395,397			307,611
Deferred cost assets		444,267			489,468			401,164
Other current liabilities		(43,654	)		(45,891	)		(58,950	)
Other liabilities		(124,353	)		(137,360	)		(64,154	)
Deferred cost liabilities		(168,007	)		(183,251	)		(123,104	)
Net deferred costs	$	276,260		$	306,217		$	278,060

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Debt (Tables)

9 Months Ended

Nov. 23, 2012

Long-Term Debt and Net of Unamortized Discounts

Long-term debt and their related calendar year due dates, net of unamortized discounts, which were zero as of November 23, 2012 and February 29, 2012, respectively, and $20.2 million as of November 25, 2011, were as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
7.375% senior notes, due 2021	$	225,000	$	225,000	$	—
Revolving credit facility, due 2015		131,651		—		—
7.375% senior notes, due 2016		—		—		213,864
7.375% notes, due 2016		—		—		20,597
6.10% senior notes, due 2028		181		181		181
	$	356,832	$	225,181	$	234,642

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Recent Accounting Pronouncements

9 Months Ended

Nov. 23, 2012

Recent Accounting Pronouncements

Note 3—Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2011-04 (“ASU 2011-04”), “Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” ASU 2011-04 improves comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. generally accepted accounting principles and International Financial Reporting Standards. ASU 2011-04 clarifies the application of existing fair value measurement requirements including (1) the application of the highest and best use and valuation premise concepts, (2) measuring the fair value of

an instrument classified in a reporting entity’s shareholders’ equity, and (3) quantitative information required for fair value measurements categorized within Level 3. ASU 2011-04 also provides guidance on measuring the fair value of financial instruments managed within a portfolio and application of premiums and discounts in a fair value measurement. In addition, ASU 2011-04 requires additional disclosure for Level 3 measurements regarding the sensitivity of fair value to changes in unobservable inputs and any interrelationships between those inputs. The amendments in this guidance are to be applied prospectively, and are effective for interim and annual periods beginning after December 15, 2011. The Corporation adopted this standard on March 1, 2012. The adoption of this standard did not have a material effect on the Corporation’s financial statements.

In June 2011, the FASB issued ASU No. 2011-05 (“ASU 2011-05”), “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of changes in shareholders’ equity and requires the presentation of components of net income and other comprehensive income either in a single continuous statement or in two separate but consecutive statements. In addition, ASU 2011-05 requires presentation of reclassification adjustments for each component of accumulated other comprehensive income in both the statement in which net income is presented and the statement in which other comprehensive income is presented. In January 2012, the FASB issued ASU No. 2011-12 (“ASU 2011-12”), “Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassification of Items out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” ASU 2011-12 defers the effective date of the requirements made in ASU 2011-05 pertaining to presentation of reclassification adjustments for each component of accumulated other comprehensive income in both net income and other comprehensive income on the face of the financial statements. ASU 2011-12 reinstates the previous requirements to present reclassification adjustments either on the face of the statement in which other comprehensive income is reported or to disclose them in the notes to the financial statements. The other requirements in ASU 2011-05 are not affected by ASU 2011-12. ASU 2011-05 and ASU 2011-12 are effective for interim and annual periods beginning after December 15, 2011. Effective March 1, 2012, the Corporation adopted the two consecutive statements approach for the presentation of components of net income (loss) and other comprehensive income (loss) and a total for comprehensive income. The Corporation’s Consolidated Financial Statements include the Consolidated Statement of Comprehensive Income as a result of adopting this standard.

In July 2012, the FASB issued ASU No. 2012-02 (“ASU 2012-02”), “Testing Indefinite-Lived Intangible Assets for Impairment.” ASU 2012-02 gives entities an option to first assess qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that the indefinite-lived intangible asset is impaired. If based on its qualitative assessment an entity concludes that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. ASU 2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Corporation does not expect that the adoption of this standard will have a material effect on its financial statements.

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Retirement Benefits (Tables)

9 Months Ended

Nov. 23, 2012

Components of Periodic Benefit Cost for Defined Benefit Pension and Postretirement Benefit Plans

The components of periodic benefit cost for the Corporation’s defined benefit pension and postretirement benefit plans are as follows:

	Defined Benefit Pension
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	386		$	206		$	1,053		$	621
Interest cost		1,864			2,127			5,547			6,418
Expected return on plan assets		(1,632	)		(1,655	)		(4,854	)		(4,998	)
Amortization of prior service cost		61			61			184			184
Amortization of actuarial loss		1,005			557			2,636			1,684
	$	1,684		$	1,296		$	4,566		$	3,909

	Postretirement Benefit
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	88		$	363		$	513		$	1,088
Interest cost		531			1,210			2,131			3,630
Expected return on plan assets		(893	)		(1,098	)		(2,573	)		(3,293	)
Amortization of prior service credit		(519	)		(638	)		(1,557	)		(1,913	)
Amortization of actuarial gain		(339	)		—			(339	)		—
	$	(1,132	)	$	(163	)	$	(1,825	)	$	(488	)

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Royalty Revenue and Related Expenses (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Segment Reporting Information [Line Items]
Material, labor and other production costs	$ 244,071	$ 230,572	$ 584,667	$ 546,699
Selling, distribution and marketing expenses	190,041	141,501	466,199	392,630
Administrative and general expenses	74,483	60,510	225,521	186,734
AG Intellectual Properties [Member]
Segment Reporting Information [Line Items]
Royalty revenue	7,085	6,401	17,947	20,785
Material, labor and other production costs	2,794	2,789	7,795	7,781
Selling, distribution and marketing expenses	1,856	2,621	5,235	7,345
Administrative and general expenses	467	431	1,330	1,292
Expenses Associated With Royalty Revenue, Total	$ 5,117	$ 5,841	$ 14,360	$ 16,418

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Debt - Additional Information (Detail) (USD $)					6 Months Ended		9 Months Ended
	Nov. 23, 2012	Sep. 21, 2012	Feb. 29, 2012	Nov. 25, 2011	Nov. 23, 2012 Credit Agreement [Member]	Nov. 23, 2012 Accounts Receivable Facility [Member]	Sep. 30, 2012 Amended And Restated Receivables Purchase Agreement [Member]	Sep. 21, 2012 Amended And Restated Receivables Purchase Agreement [Member]	Nov. 23, 2012 Publicly Traded [Member]	Feb. 29, 2012 Publicly Traded [Member]	Nov. 25, 2011 Publicly Traded [Member]	Nov. 23, 2012 Non Publicly Traded [Member]
Debt Instrument [Line Items]
Line of credit facility potential maximum borrowing capacity					$ 400,000,000
Balances outstanding under the revolving credit facility					131,700,000
Available financing of receivables purchase agreement		70,000,000				50,000,000		50,000,000
Letters of credit outstanding	30,600,000
Interest at a rate					1.50%
Liquidity commitments under the receivables purchase agreement renewed day							1 year
Debt due within one year			0	0
Long-term debt net of unamortized discounts	0		0	20,200,000
Fair value of the traded debt									241,900,000	239,600,000	243,600,000	131,700,000
Quoted market prices of Corporation's publicly traded debt, carrying value	$ 356,832,000		$ 225,181,000	$ 234,642,000					$ 225,200,000	$ 225,200,000	$ 234,600,000	$ 131,700,000

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CONSOLIDATED STATEMENT OF OPERATIONS (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Net sales	$ 499,368	$ 458,535	$ 1,275,139	$ 1,217,800
Other revenue	7,446	6,472	18,617	21,097
Total revenue	506,814	465,007	1,293,756	1,238,897
Material, labor and other production costs	244,071	230,572	584,667	546,699
Selling, distribution and marketing expenses	190,041	141,501	466,199	392,630
Administrative and general expenses	74,483	60,510	225,521	186,734
Other operating income - net	(2,217)	(813)	(1,421)	(6,858)
Operating income	436	33,237	18,790	119,692
Interest expense	4,504	5,821	13,314	17,708
Interest income	(65)	(207)	(297)	(838)
Other non-operating (income) expense - net	(1,904)	(2,077)	3,523	(2,621)
(Loss) income before income tax (benefit) expense	(2,099)	29,700	2,250	105,443
Income tax (benefit) expense	(1,290)	9,454	63	38,128
Net (loss) income	$ (809)	$ 20,246	$ 2,187	$ 67,315
(Loss) earnings per share - basic	$ (0.03)	$ 0.51	$ 0.06	$ 1.67
(Loss) earnings per share - assuming dilution	$ (0.03)	$ 0.50	$ 0.06	$ 1.63
Average number of shares outstanding	31,877,088	39,480,798	33,712,073	40,226,039
Average number of shares outstanding - assuming dilution	31,877,088	40,436,865	34,478,737	41,381,157
Dividends declared per share	$ 0.15	$ 0.15	$ 0.45	$ 0.45

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Loss Earnings Per Share (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Numerator
Net (loss) income	$ (809)	$ 20,246	$ 2,187	$ 67,315
Denominator
Weighted average shares outstanding	31,877,088	39,480,798	33,712,073	40,226,039
Effect of dilutive securities:
Stock options and awards		956,000	767,000	1,155,000
Weighted average shares outstanding - assuming dilution	31,877,088	40,436,865	34,478,737	41,381,157
(Loss) earnings per share	$ (0.03)	$ 0.51	$ 0.06	$ 1.67
(Loss) earnings per share - assuming dilution	$ (0.03)	$ 0.50	$ 0.06	$ 1.63

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Basis of Presentation

9 Months Ended

Nov. 23, 2012

Basis of Presentation

Note 1—Basis of Presentation

The accompanying unaudited consolidated financial statements of American Greetings Corporation and its subsidiaries (the “Corporation”) have been prepared in accordance with accounting principles generally accepted in the United States 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 of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary to fairly present financial position, results of operations and cash flows for the periods have been included.

The Corporation’s fiscal year ends on February 28 or 29. References to a particular year refer to the fiscal year ending in February of that year. For example, 2012 refers to the year ended February 29, 2012. The Corporation’s subsidiary, AG Retail Cards Limited, which operates the recently acquired retail stores in the United Kingdom (also referred to herein as “UK”), is consolidated on a one-month lag corresponding with its fiscal year-end of February 2 for 2013. See Note 4 for further information.

These interim financial statements should be read in conjunction with the Corporation’s financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended February 29, 2012, from which the Consolidated Statement of Financial Position at February 29, 2012, presented herein, has been derived. Certain amounts in the prior year financial statements have been reclassified to conform to the 2013 presentation. These reclassifications had no material impact on financial position, earnings or cash flows.

The Corporation’s investments in less than majority-owned companies in which it has the ability to exercise significant influence over the operation and financial policies are accounted for using the equity method except when they qualify as variable interest entities (“VIE”) and the Corporation is the primary beneficiary, in which case, the investments are consolidated in accordance with Accounting Standards Codification (“ASC”) Topic 810 (“ASC 810”), “Consolidation.” Investments that do not meet the above criteria are accounted for under the cost method.

The Corporation holds an approximately 15% equity interest in Schurman Fine Papers (“Schurman”), which is a VIE as defined in ASC 810. Schurman owns and operates specialty card and gift retail stores in the United States and Canada. The stores are primarily located in malls and strip shopping centers. During the current period, the Corporation assessed the variable interests in Schurman and determined that a third party holder of variable interests has the controlling financial interest in the VIE and thus, the third party, not the Corporation, is the primary beneficiary. In completing this assessment, the Corporation identified the activities that it considers most significant to the future economic success of the VIE and determined that it does not have the power to direct those activities. As such, Schurman is not consolidated in the Corporation’s results. The Corporation’s maximum exposure to loss as it relates to Schurman as of November 23, 2012 includes:

• the investment in the equity of Schurman of $1.9 million;

• the limited guaranty (“Liquidity Guaranty”) of Schurman’s indebtedness of $12.0 million;

• normal course of business trade and other receivables due from Schurman of $29.8 million, the balance of which fluctuates throughout the year due to the seasonal nature of the business;

• the operating leases currently subleased to Schurman, the aggregate lease payments for the remaining life of which was $15.0 million, $22.1 million and $24.9 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively; and

• the subordinated credit facility (the “Subordinated Credit Facility”) that provides Schurman with up to $10.0 million of subordinated financing.

The Corporation provides Schurman limited credit support through the provision of a Liquidity Guaranty in favor of the lenders under Schurman’s senior revolving credit facility (the “Senior Credit Facility”). Pursuant to the terms of the Liquidity Guaranty, the Corporation has guaranteed the repayment of up to $12.0 million of Schurman’s

borrowings under the Senior Credit Facility to help ensure that Schurman has sufficient borrowing availability under this facility. The Liquidity Guaranty is required to be backed by a letter of credit for the term of the Liquidity Guaranty, which is currently anticipated to end in January 2014. The Corporation’s obligations under the Liquidity Guaranty generally may not be triggered unless Schurman’s lenders under its Senior Credit Facility have substantially completed the liquidation of the collateral under Schurman’s Senior Credit Facility, or 91 days after the liquidation is started, whichever is earlier, and will be limited to the deficiency, if any, between the amount owed and the amount collected in connection with the liquidation. There was no triggering event or liquidation of collateral as of November 23, 2012 requiring the use of the guaranty.

The Subordinated Credit Facility that the Corporation provides to Schurman had an initial term of nineteen months expiring on November 17, 2010, however, unless either party provides the appropriate written notice prior to the expiration of the applicable term, the facility automatically renews for periods of one year, except in the case of the last renewal, in which case the facility can only renew for the partial year ending on the facility’s expiration date of June 25, 2013. Schurman can only borrow under the facility if it does not have other sources of financing available, and borrowings under the Subordinated Credit Facility may only be used for specified purposes. Borrowings under the Subordinated Credit Facility are subordinate to borrowings under Schurman’s Senior Credit Facility and the Subordinated Credit Facility includes affirmative and negative non-financial covenants and events of default customary for such financings. As of November 23, 2012, Schurman had not borrowed under the Subordinated Credit Facility.

In addition to the investment in the equity of Schurman, the Corporation held a minority investment in the common stock of Party City Holdings, Inc. (“Party City”), formerly known as AAH Holdings Corporation. On June 4, 2012, Party City announced that it entered into a definitive agreement (the “Merger Agreement”) to sell a majority stake of the company in a recapitalization transaction valued at $2.69 billion. On July 27, 2012, this transaction closed and Party City merged with and into PC Merger Sub, Inc., a wholly-owned subsidiary of PC Topco Holdings, Inc. (“Holdings”). Contemporaneously with the closing, on July 27, 2012, the Corporation exchanged 617.3 shares of its Party City common stock for 1,200 shares of common stock of the new company, Holdings, and sold its remaining 123.44 shares of Party City common stock for $4.9 million, recording a gain of $3.2 million. Cash proceeds from the sale, which totaled $4.9 million were received during the three months ended November 23, 2012 and are reflected in investing activities on the Consolidated Statement of Cash Flows. The terms of the Merger Agreement include certain provisions contemplating the adjustment of the purchase price paid in the transaction under certain circumstances. As a result, approximately $1 million of the cash consideration potentially payable to the Corporation in exchange for its shares of Party City common stock was being withheld in escrow until resolution of any such purchase price adjustment. On November 21, 2012, the purchase price adjustment was finalized and a gain totaling $1.1 million was recognized in the three months ended November 23, 2012. The cash proceeds were received in December 2012. The investment in Schurman and the investment in Holdings totaled $10.7 million as of November 23, 2012, and are accounted for under the cost method.

During the nine months ended November 23, 2012, the Corporation recorded certain charges associated with activities and transactions related to Clinton Cards PLC (“Clinton Cards”) that do not have comparative amounts in the prior year period. See Note 4 for further information.

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Contingency - Additional Information (Detail) (USD $)	1 Months Ended	9 Months Ended
	Sep. 30, 2012	Nov. 23, 2012 Moon Scoop [Member]
Gain Contingencies [Line Items]
Attorney fees incurred		$ 161,309
Outstanding Class A and Class B common shares, price per share	$ 17.18

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Basis of Presentation - Additional Information (Detail) (USD $)	3 Months Ended	9 Months Ended				9 Months Ended			9 Months Ended		1 Months Ended	3 Months Ended		9 Months Ended		1 Months Ended
	Nov. 23, 2012	Nov. 23, 2012	Nov. 23, 2012 Operating Lease Sublease to Schurman [Member]	Feb. 29, 2012 Operating Lease Sublease to Schurman [Member]	Nov. 25, 2011 Operating Lease Sublease to Schurman [Member]	Nov. 23, 2012 Schurman [Member]	Nov. 23, 2012 Schurman [Member] Subordinated Credit Facility [Member]	Nov. 23, 2012 Schurman [Member] Collectibility of Receivables [Member]	Nov. 23, 2012 Schurman [Member] Liquidity Guaranty [Member]	Nov. 23, 2012 Schurman [Member] Investment In Equity [Member]	Jul. 27, 2012 Part City Holdings, Inc [Member]	Nov. 23, 2012 Part City Holdings, Inc [Member]	Aug. 24, 2012 Part City Holdings, Inc [Member]	Nov. 23, 2012 Part City Holdings, Inc [Member]	Jun. 04, 2012 Part City Holdings, Inc [Member]	Jul. 27, 2012 PC Topco Holdings, Inc [Member]
Variable Interest Entity [Line Items]
Equity Interest of Variable Interest Entity						15.00%
Maximum exposure to loss, Amount			$ 15,000,000	$ 22,100,000	$ 24,900,000		$ 10,000,000	$ 29,800,000	$ 12,000,000	$ 1,900,000
Number of days under liquidity guaranty									91 days
End period of Liquidity Guaranty									2014-01
Initial term of Subordinated Credit Facility							19 months
End Period of Subordinated Credit Facility							Nov. 17, 2010
Renewal Period of Subordinated Credit Facility							1 year
Majority stake disposal value															2,690,000,000
Number of common shares exchanged											617.3
Number of common shares exchanged																1,200
Number of common shares sold											123.44
Value of common shares sold											4,900,000
Gain on common shares sold	1,141,000	4,293,000									3,152,000	1,100,000	3,200,000	4,300,000
Cash proceeds from sale		4,920,000										4,900,000
Additional Proceeds on working capital adjustment											1,000,000
Total investments in common stock	$ 10,700,000	$ 10,700,000

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Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation

9 Months Ended

Nov. 23, 2012

Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation

Note 17—Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation

On September 26, 2012, the Corporation announced that its Board of Directors received the non-binding Going Private Proposal from Zev Weiss, its Chief Executive Officer, and Jeffrey Weiss, its President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties to acquire all of the outstanding Class A and Class B common shares of the Corporation not currently owned by them for $17.18 per share in cash. The Corporation’s Board of Directors has formed a special committee of independent directors (the "Special Committee") to, among other things, consider the Going Private Proposal. The Special Committee is also authorized to review and evaluate other options available to the Corporation, and has retained its own financial advisor as well as legal counsel. Since the announcement of the Going Private Proposal, a number of lawsuits have been filed against the Corporation in State and Federal court. See Note 14 for further information concerning these lawsuits.

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Acquisition - Additional Information (Detail)	9 Months Ended		3 Months Ended		9 Months Ended
	Nov. 23, 2012 USD ($)	Nov. 25, 2011 USD ($)	Aug. 24, 2012 Clinton Cards [Member] USD ($)	May 25, 2012 Clinton Cards [Member] USD ($)	Nov. 23, 2012 Clinton Cards [Member] USD ($) Store Brand	Nov. 23, 2012 Clinton Cards [Member] GBP (£)	Nov. 23, 2012 Clinton Cards [Member] Lease Agreements [Member] Lease
Business Acquisition [Line Items]
Purchase of outstanding senior secured debt	$ (56,560,000)				$ 56,600,000	£ 35,000,000
Number of stores owned clinton					750	750
Annual Revenues Clinton					600,000,000
Liquidation process and negotiations period with landlords for stores to be acquired					2	2
Purchase of debt clinton cards bid for assets					37,200,000	23,000,000
Number of stores purchased by lakeshore from Clinton					400	400
Proforma revenue					265,000,000
Estimated future minimum rental payments for noncancelable operating lease related to acquired stores					367,000,000
Completed lease assignments							185
Purchase of debt clinton cards remaining					19,400,000	12,000,000
Expenses related to senior secured debt	10,043,000		2,200,000	7,800,000	10,000,000
Secured senior notes					9,000,000
Liquidation process and negotiations period with landlords for stores to be acquired					12 months	12 months
Provision for doubtful accounts	17,771,000	4,879,000		17,200,000	17,200,000
Asset impairment charges				$ 4,000,000	$ 4,000,000

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Acquisition (Tables)

9 Months Ended

Nov. 23, 2012

Comparative Amounts in Prior Year Period

The charges incurred in the nine months ended November 23, 2012 associated with the aforementioned acquisition that do not have comparative amounts in the prior year nine month period are reflected on the Consolidated Statement of Operations as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
Net sales	$	4.0	$	—	$	—	$	—	$	4.0
Administrative and general expenses		—		17.2		6.3		—		23.5
Other non-operating (income) expense		—		—		—		10.0		10.0
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

Charges Reflected in Reportable Segment

These charges are reflected in the Corporation’s reportable segments as follows:

(In millions)	Contract asset impairment		Bad debt expense		Legal and advisory fees		Impairment of debt purchased		Total
International Social Expression Products	$	4.0	$	17.2	$	—	$	—	$	21.2
Unallocated		—		—		6.3		10.0		16.3
	$	4.0	$	17.2	$	6.3	$	10.0	$	37.5

Purchase Price Allocation

The following represents the preliminary purchase price allocation:

Purchase price (in millions):
Credit bid	$	37.2
Effective settlement of pre-existing supply agreement with the legacy Clinton Cards business		6.2
Cash acquired		(0.6	)
	$	42.8
Allocation (in millions):
Inventory	$	16.2
Property, plant and equipment		20.0
Intangible assets		7.1
Current liabilities assumed		(0.5	)
	$	42.8

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Seasonal Nature of Business

9 Months Ended

Nov. 23, 2012

Seasonal Nature of Business

Note 2—Seasonal Nature of Business

A significant portion of the Corporation’s business is seasonal in nature. Therefore, the results of operations for interim periods are not necessarily indicative of the results for the fiscal year taken as a whole.

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011
Net (loss) income	$ (809)	$ 20,246	$ 2,187	$ 67,315
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	2,680	(15,592)	(91)	(12,554)
Pension and postretirement benefit adjustments	145	536	643	607
Unrealized loss on securities		(1)	(1)
Other comprehensive income (loss), net of tax	2,825	(15,057)	551	(11,947)
Comprehensive income	$ 2,016	$ 5,189	$ 2,738	$ 55,368

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Retirement Benefits

9 Months Ended

Nov. 23, 2012

Retirement Benefits

Note 12—Retirement Benefits

The components of periodic benefit cost for the Corporation’s defined benefit pension and postretirement benefit plans are as follows:

	Defined Benefit Pension
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	386		$	206		$	1,053		$	621
Interest cost		1,864			2,127			5,547			6,418
Expected return on plan assets		(1,632	)		(1,655	)		(4,854	)		(4,998	)
Amortization of prior service cost		61			61			184			184
Amortization of actuarial loss		1,005			557			2,636			1,684
	$	1,684		$	1,296		$	4,566		$	3,909

	Postretirement Benefit
	Three Months Ended						Nine Months Ended
	November 23,			November 25,			November 23,			November 25,
(In thousands)	2012			2011			2012			2011
Service cost	$	88		$	363		$	513		$	1,088
Interest cost		531			1,210			2,131			3,630
Expected return on plan assets		(893	)		(1,098	)		(2,573	)		(3,293	)
Amortization of prior service credit		(519	)		(638	)		(1,557	)		(1,913	)
Amortization of actuarial gain		(339	)		—			(339	)		—
	$	(1,132	)	$	(163	)	$	(1,825	)	$	(488	)

The Corporation has a discretionary profit-sharing plan with a 401(k) provision covering most of its United States employees. The profit-sharing plan expense for the nine months ended November 23, 2012 was $3.9 million, compared to $6.3 million in the prior year period. The Corporation also matches a portion of 401(k) employee contributions. The expenses recognized for the three and nine month periods ended November 23, 2012 were $2.3 million and $4.9 million ($1.9 million and $4.5 million for the three and nine month periods ended November 25, 2011), respectively. The profit-sharing plan and 401(k) matching expenses for the nine month periods are estimates as actual contributions are determined after fiscal year-end.

At November 23, 2012, February 29, 2012 and November 25, 2011, the liability for postretirement benefits other than pensions was $28.6 million, $24.8 million and $29.9 million, respectively, and is included in “Other liabilities” on the Consolidated Statement of Financial Position. At November 23, 2012, February 29, 2012 and November 25, 2011, the long-term liability for pension benefits was $75.7 million, $75.7 million and $59.8 million, respectively, and is included in “Other liabilities” on the Consolidated Statement of Financial Position.

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Document and Entity Information	9 Months Ended
	Nov. 23, 2012	Dec. 27, 2012 Common Class A [Member]	Dec. 27, 2012 Common Class B [Member]
Entity Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Nov. 23, 2012
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Entity Registrant Name	AMERICAN GREETINGS CORP
Entity Central Index Key	0000005133
Current Fiscal Year End Date	--02-28
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		28,780,998	2,856,813

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Fair Value Measurements

9 Months Ended

Nov. 23, 2012

Fair Value Measurements

Note 13—Fair Value Measurements

Assets and liabilities measured at fair value are classified using the fair value hierarchy based upon the transparency of inputs as of the measurement date. The classification of fair value measurements within the hierarchy is based upon the lowest level of input that is significant to the measurement. The three levels are defined as follows:

• Level 1 – Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2 – Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

• Level 3 – Valuation is based upon unobservable inputs that are significant to the fair value measurement.

The following table summarizes the financial assets measured at fair value as of November 23, 2012:

	November 23, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	10,177	$	10,177	$	—	$	—

The following table summarizes the financial assets measured at fair value as of February 29, 2012:

	February 29, 2012		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Deferred compensation plan assets (1)	$	9,198	$	9,198	$	—	$	—

The following table summarizes the financial assets measured at fair value as of November 25, 2011:

	November 25, 2011		Level 1		Level 2		Level 3
Assets measured on a recurring basis:
Active employees’ medical plan trust assets	$	3,312	$	3,312	$	—	$	—
Deferred compensation plan assets (1)		8,719		8,719		—		—
Total	$	12,031	$	12,031	$	—	$	—

(1) There is an offsetting liability for the obligation to its employees on the Corporation’s books.

As of February 29, 2012, the active employees’ medical plan trust was terminated. During the prior year, the fair value of the investments in the active employees’ medical plan trust was considered a Level 1 valuation as it was based on the quoted market value per share of each individual security investment in an active market.

The deferred compensation plan includes mutual fund assets. Assets held in mutual funds were recorded at fair value, which was considered a Level 1 valuation as it is based on each fund’s quoted market value per share in an active market. The fair value of the related non-qualified deferred compensation liability is based on the fair value of the mutual fund and the Corporation is under no obligation to fund employees’ nonqualified accounts.

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION (USD $) In Thousands, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Current assets
Cash and cash equivalents	$ 63,291	$ 132,438	$ 85,661
Trade accounts receivable, net	197,844	113,840	235,318
Inventories	264,330	208,945	214,412
Deferred and refundable income taxes	80,502	58,118	57,400
Prepaid expenses and other	155,543	123,419	123,481
Total current assets	761,510	636,760	716,272
Goodwill			27,713
Other assets	460,647	503,700	417,479
Deferred and refundable income taxes	120,870	121,228	128,595
Property, plant and equipment - at cost	1,004,686	924,512	904,555
Less accumulated depreciation	642,994	636,736	637,334
Property, plant and equipment - net	361,692	287,776	267,221
Assets, Total	1,704,719	1,549,464	1,557,280
Current liabilities
Accounts payable	194,945	86,166	108,254
Accrued liabilities	82,893	58,657	67,596
Accrued compensation and benefits	60,702	68,317	58,411
Income taxes payable	14,641	7,409	26,626
Deferred revenue	26,404	35,519	29,477
Other current liabilities	44,287	49,013	60,963
Total current liabilities	423,872	305,081	351,327
Long-term debt	356,832	225,181	234,642
Other liabilities	259,787	269,367	182,565
Deferred income taxes and noncurrent income taxes payable	21,008	22,377	21,769
Shareholders' equity
Capital in excess of par value	520,119	513,163	509,999
Treasury stock	(1,093,789)	(1,020,838)	(995,338)
Accumulated other comprehensive loss	(11,279)	(11,830)	(14,293)
Retained earnings	1,196,460	1,210,110	1,228,269
Total shareholders' equity	643,220	727,458	766,977
Total liabilities and stockholders' equity	1,704,719	1,549,464	1,557,280
Common Class A [Member]
Shareholders' equity
Common shares	28,849	34,011	35,562
Common Class B [Member]
Shareholders' equity
Common shares	$ 2,860	$ 2,842	$ 2,778

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(Loss) Earnings Per Share

9 Months Ended

Nov. 23, 2012

(Loss) Earnings Per Share

Note 7—(Loss) Earnings Per Share

The following table sets forth the computation of (loss) earnings per share and (loss) earnings per share—assuming dilution:

	Three Months Ended					Nine Months Ended
	November 23, 2012			November 25, 2011		November 23, 2012		November 25, 2011
Numerator (in thousands):
Net (loss) income	$	(809	)	$	20,246	$	2,187	$	67,315
Denominator (in thousands):
Weighted average shares outstanding		31,877			39,481		33,712		40,226
Effect of dilutive securities:
Stock options and awards		—			956		767		1,155
Weighted average shares outstanding – assuming dilution		31,877			40,437		34,479		41,381
(Loss) earnings per share	$	(0.03	)	$	0.51	$	0.06	$	1.67
(Loss) earnings per share – assuming dilution	$	(0.03	)	$	0.50	$	0.06	$	1.63

Certain stock options were excluded from the computation of earnings per share-assuming dilution, as the effect would have been antidilutive due to the net loss in the period. The stock options excluded from the computation of earnings per share-assuming dilution were approximately 3.7 million in both the three and nine month periods ended November 23, 2012 (3.7 million and 2.4 million in the three and nine month periods ended November 25, 2011, respectively) because the options’ exercise prices were greater than the average price of the common shares.

There were an insignificant number of Class A common shares issued upon exercise of employee stock options and vesting of equity awards during the three months ended November 23, 2012 (0.1 million Class A common shares during the three months ended November 25, 2011). There were no Class B common shares issued upon exercise of employee stock options and vesting of equity awards during the three months ended November 23, 2012. The Corporation issued approximately 0.2 million Class A common shares and an insignificant number of Class B common shares upon exercise of employee stock options and vesting of equity awards during the nine months ended November 23, 2012 (0.7 million and 0.3 million Class A and Class B common shares, respectively, during the nine months ended November 25, 2011).

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Other Income and Expense

9 Months Ended

Nov. 23, 2012

Other Income and Expense

Note 6—Other Income and Expense

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of intellectual properties	$	—		$	—		$	—		$	(4,500	)
Termination of certain agency agreements		—			—			2,125			—
Miscellaneous		(2,217	)		(813	)		(3,546	)		(2,358	)
Other operating income – net	$	(2,217	)	$	(813	)	$	(1,421	)	$	(6,858	)

In May 2012, the Corporation recorded expenses totaling $2.1 million related to the termination of certain agency agreements associated with its licensing business.

In June 2011, the Corporation sold certain minor character properties and recognized a gain of $4.5 million. The proceeds of $4.5 million were included in “Proceeds from sale of intellectual properties” on the Consolidated Statement of Cash Flows.

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of Party City investment	$	(1,141	)	$	—		$	(4,293	)	$	—
Loss on Clinton Cards debt		—			—			10,043			—
Foreign exchange gain		(552	)		(1,500	)		(948	)		(631	)
Rental income		(450	)		(238	)		(1,496	)		(977	)
Loss (gain) on asset disposal		240			(323	)		394			(807	)
Miscellaneous		(1	)		(16	)		(177	)		(206	)
Other non-operating (income) expense – net	$	(1,904	)	$	(2,077	)	$	3,523		$	(2,621	)

“Miscellaneous” includes, among other things, income/loss from debt and equity securities.

During the nine months ended November 23, 2012, the Corporation recorded a gain of $4.3 million associated with the sale of a portion of its investment in Party City, including $1.1 million and $3.2 million in the three months ended November 23, 2012 and August 24, 2012, respectively. See Note 1 for further information.

The Corporation also recorded a loss of $10.0 million during the nine months ended November 23, 2012 related to the senior secured debt of Clinton Cards that the Corporation acquired during the first quarter, including $7.8 million and $2.2 million in the three months ended May 25, 2012 and August 24, 2012, respectively. See Note 4 for further information.

In October 2011, the Corporation sold the land and buildings relating to its party goods product lines in the North American Social Expression Products segment that were previously included in “Assets held for sale” on the Consolidated Statement of Financial Position and recorded a gain of approximately $0.4 million. The cash proceeds of approximately $6.0 million received from the sale of the assets are included in “Proceeds from sale of fixed assets” on the Consolidated Statement of Cash Flows.

In June 2011, the Corporation sold the land, building and certain equipment associated with a distribution facility in the International Social Expression Products segment that were previously included in “Assets held for sale” on the Consolidated Statement of Financial Position and recorded a gain of approximately $0.5 million. The cash proceeds of approximately $2.4 million received from the sale of the assets are included in “Proceeds from sale of fixed assets” on the Consolidated Statement of Cash Flows.

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Recent Accounting Pronouncements (Policies)

9 Months Ended

Nov. 23, 2012

Fair Value Measurement

In May 2011, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2011-04 (“ASU 2011-04”), “Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” ASU 2011-04 improves comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. generally accepted accounting principles and International Financial Reporting Standards. ASU 2011-04 clarifies the application of existing fair value measurement requirements including (1) the application of the highest and best use and valuation premise concepts, (2) measuring the fair value of

an instrument classified in a reporting entity’s shareholders’ equity, and (3) quantitative information required for fair value measurements categorized within Level 3. ASU 2011-04 also provides guidance on measuring the fair value of financial instruments managed within a portfolio and application of premiums and discounts in a fair value measurement. In addition, ASU 2011-04 requires additional disclosure for Level 3 measurements regarding the sensitivity of fair value to changes in unobservable inputs and any interrelationships between those inputs. The amendments in this guidance are to be applied prospectively, and are effective for interim and annual periods beginning after December 15, 2011. The Corporation adopted this standard on March 1, 2012. The adoption of this standard did not have a material effect on the Corporation’s financial statements.

Comprehensive Income

In June 2011, the FASB issued ASU No. 2011-05 (“ASU 2011-05”), “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of changes in shareholders’ equity and requires the presentation of components of net income and other comprehensive income either in a single continuous statement or in two separate but consecutive statements. In addition, ASU 2011-05 requires presentation of reclassification adjustments for each component of accumulated other comprehensive income in both the statement in which net income is presented and the statement in which other comprehensive income is presented. In January 2012, the FASB issued ASU No. 2011-12 (“ASU 2011-12”), “Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassification of Items out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” ASU 2011-12 defers the effective date of the requirements made in ASU 2011-05 pertaining to presentation of reclassification adjustments for each component of accumulated other comprehensive income in both net income and other comprehensive income on the face of the financial statements. ASU 2011-12 reinstates the previous requirements to present reclassification adjustments either on the face of the statement in which other comprehensive income is reported or to disclose them in the notes to the financial statements. The other requirements in ASU 2011-05 are not affected by ASU 2011-12. ASU 2011-05 and ASU 2011-12 are effective for interim and annual periods beginning after December 15, 2011. Effective March 1, 2012, the Corporation adopted the two consecutive statements approach for the presentation of components of net income (loss) and other comprehensive income (loss) and a total for comprehensive income. The Corporation’s Consolidated Financial Statements include the Consolidated Statement of Comprehensive Income as a result of adopting this standard.

Testing Indefinite-Lived Intangible Assets for Impairment

In July 2012, the FASB issued ASU No. 2012-02 (“ASU 2012-02”), “Testing Indefinite-Lived Intangible Assets for Impairment.” ASU 2012-02 gives entities an option to first assess qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that the indefinite-lived intangible asset is impaired. If based on its qualitative assessment an entity concludes that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. ASU 2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Corporation does not expect that the adoption of this standard will have a material effect on its financial statements.

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Contingency

9 Months Ended

Nov. 23, 2012

Contingency

Note 14—Contingency

The Corporation is presently involved in various judicial, administrative, regulatory and arbitration proceedings concerning matters arising in the ordinary course of business, including but not limited to, employment, commercial disputes and other contractual matters, some of which are described below. These matters are inherently subject to many uncertainties regarding the possibility of a loss to the Corporation. These uncertainties will ultimately be resolved when one or more future events occur or fail to occur, confirming the incurrence of a liability or reduction of a liability. In accordance with ASC Topic 450, “Contingencies,” the Corporation accrues for these contingencies by a charge to income when it is both probable that one or more future events will occur confirming the fact of a loss and the amount of the loss can be reasonably estimated. Due to this uncertainty, the actual amount of any loss may ultimately prove to be larger or smaller than the amounts reflected in the Corporation’s Consolidated Financial Statements. Some of these proceedings are at preliminary stages and some of these cases seek an indeterminate amount of damages.

Baker/Collier Litigation. American Greetings Corporation is a defendant in two putative class action lawsuits involving corporate-owned life insurance policies (the “Insurance Policies”): one filed in the Northern District of Ohio on January 11, 2012 by Theresa Baker as the personal representative of the estate of Richard Charles Wolfe (the “Baker Litigation”); and the other filed in the Northern District of Oklahoma on October 1, 2010 by Keith Collier as the personal representative of the estate of Ruthie Collier (the “Collier Litigation”).

In the Baker Litigation, the plaintiff claims that American Greetings Corporation (1) misappropriated its employees’ names and identities to benefit itself; (2) breached its fiduciary duty by using its employees’ identities and personal information to benefit itself; (3) unjustly enriched itself through the receipt of corporate-owned life insurance policy benefits, interest and investment returns; and (4) improperly received insurance policy benefits for the insurable interest in Mr. Wolfe’s life. The plaintiff seeks damages in the amount of all pecuniary benefits associated with the subject Insurance Policies, including investment returns, interest and life insurance policy benefits that American Greetings Corporation received from the deaths of the former employees whose estates form the putative class. The plaintiff also seeks punitive damages, pre- and post-judgment interest, costs and attorney’s fees. On April 30, 2012, American Greetings Corporation filed a Motion to Dismiss the Plaintiff’s Complaint. Shortly thereafter, the plaintiff filed a Motion for Class Certification. The court stayed the plaintiff’s Motion for Class Certification until the Motion to Dismiss was decided. On September 19, 2012, the Ohio federal court ordered the Baker plaintiff to file an amended complaint and then denied without prejudice the Corporation’s Motion to Dismiss the Baker Litigation as moot. On October 1, 2012, the plaintiff filed a Second Amended Complaint. On October 18, 2012, American Greetings Corporation filed its Motion to Dismiss the Second Amended Complaint. Class certification has not been decided in either of these cases.

In the Collier Litigation, the plaintiff claims that American Greetings Corporation did not have an insurable interest when it obtained the subject Insurance Policies and wrongfully received the benefits from those policies. The plaintiff seeks damages in the amount of policy benefits received by American Greetings Corporation from the subject Insurance Policies, as well as attorney’s fees and costs and interest. On April 2, 2012, the plaintiff filed its First Amended Complaint, adding misappropriation of employee information and breach of fiduciary duty claims as well as seeking punitive damages. On April 20, 2012, American Greetings Corporation filed a Motion to Transfer the case to the Ohio federal court. On July 6, 2012, the court granted the Corporation’s Motion to Transfer and transferred the case to the Northern District of Ohio, where the Baker Litigation is pending.

As requested by the court, the parties filed a joint proposed scheduling order on October 29, 2012, setting the Collier and Baker Litigations on parallel procedural tracks. On January 2, 2013, the parties filed a Joint Motion to Stay the Collier and Baker Litigations for 60 days to allow the parties to engage in private mediation. The same law firm represents the individual plaintiffs in the Collier and Baker matters.

Cookie Jar/MoonScoop Litigation. As previously disclosed, on May 6, 2009, American Greetings Corporation and its subsidiary, Those Characters From Cleveland, Inc. (“TCFC”), filed an action in the Cuyahoga County (Ohio) Court of Common Pleas against Cookie Jar Entertainment Inc. (“Cookie Jar”) and its affiliates, Cookie Jar Entertainment (USA) Inc. (formerly known as DIC Entertainment Corporation) (“DIC”) and Cookie Jar Entertainment Holdings (USA) Inc. (formerly known as DIC Entertainment Holdings, Inc.) relating to the July 20, 2008 Binding Letter Agreement between American Greetings Corporation and Cookie Jar (the “Cookie Jar Agreement”) for the sale of the Strawberry Shortcake and Care Bears properties (the “Properties”). On May 7, 2009, Cookie Jar removed the case to the United States District Court for the Northern District of Ohio. Simultaneously, Cookie Jar filed an action against American Greetings Corporation, TCFC, Mike Young Productions, LLC (“Mike Young Productions”) and MoonScoop SAS (“MoonScoop”) in the Supreme Court of the State of New York, County of New York. Mike Young Productions and MoonScoop were named as defendants in the action in connection with the binding term sheet between American Greetings Corporation and MoonScoop dated March 24, 2009 (the “MoonScoop Binding Agreement”), providing for the sale to MoonScoop of the Properties.

On May 7, 2010, the legal proceedings involving American Greetings Corporation, TCFC, Cookie Jar and DIC were settled, without a payment to any of the parties. As part of the settlement, on May 7, 2010, the Cookie Jar Agreement was amended to, among other things, terminate American Greetings Corporation’s obligation to sell to Cookie Jar, and Cookie Jar’s obligation to purchase, the Properties. As part of the settlement, Cookie Jar Entertainment (USA) Inc. continued to represent the Strawberry Shortcake property on behalf of American Greetings Corporation and become an international agent for the Care Bears property. On May 19, 2010, the Northern District of Ohio court granted the parties’ joint motion to dismiss all claims and counterclaims without prejudice.

On August 11, 2009, MoonScoop filed an action against American Greetings Corporation and TCFC in the United States District Court for the Northern District of Ohio, alleging breach of contract and promissory estoppel relating to the MoonScoop Binding Agreement. On MoonScoop’s request, the court agreed to consolidate this lawsuit with the first Ohio lawsuit (described above) for all pretrial purposes. The parties filed motions for summary judgment on various claims. On April 27, 2010, the court granted American Greetings Corporation’s and TCFC’s motion for summary judgment on MoonScoop’s breach of contract and promissory estoppel claims, dismissing these claims with prejudice. On the same day, the court also ruled that American Greetings Corporation must indemnify MoonScoop against Cookie Jar’s claims in this lawsuit. On May 21, 2010, MoonScoop appealed the court’s summary judgment ruling to the United States Court of Appeals for the Sixth Circuit. On June 4, 2010, American Greetings Corporation and TCFC appealed to the United States Court of Appeals for the Sixth Circuit the court’s ruling that it must indemnify MoonScoop against the cross claims asserted against it.

On July 16, 2012, the U.S. Sixth Circuit Court of Appeals reversed the Northern District of Ohio’s order that had granted American Greetings Corporation’s summary judgment on MoonScoop’s principal claims. The case has been remanded to the District Court for further proceedings. The Court of Appeals also affirmed the District Court’s finding on summary judgment in favor of MoonScoop on its indemnity claim, involving MoonScoop’s attorney fees for defending against Cookie Jar’s third-party claims (which have been dismissed). As a result, the Corporation has reimbursed MoonScoop for the $161,309 in attorney fees that it incurred. The District Court trial began on November 13, 2012. The jury returned a unanimous verdict in favor of American Greetings Corporation and TCFC. On November 26, 2012, the District Court entered judgment in favor of American Greetings Corporation and against MoonScoop. On December 20, 2012, MoonScoop appealed the verdict to the United States Court of Appeals for the Sixth Circuit.

Carter/Wolfe/LMPERS Litigation. On September 26, 2012, the Corporation announced that the Board of Directors had received a non-binding proposal (the “Going Private Proposal”) dated September 25, 2012 from Zev Weiss, our Chief Executive Officer, and Jeffrey Weiss, our President and Chief Operating Officer, on behalf of themselves and certain other members of the Weiss family and related parties, to acquire all of the outstanding Class A and Class B common shares not currently owned by them for $17.18 per share. On September 27, 2012, Dolores Carter, a purported shareholder, filed a putative class action and shareholder derivative lawsuit in the Court of Common Pleas in Cuyahoga County, Ohio, against American Greetings Corporation and all of the members of its Board of Directors, alleging that the directors breached their fiduciary duties in evaluating the Going Private Proposal and seeking declaratory relief. Subsequently, eight more lawsuits were filed in Cuyahoga County state court against American Greetings Corporation and its Board of Directors. One lawsuit was voluntarily dismissed. The remaining lawsuits were consolidated and remain pending with the commercial docket in Cuyahoga County court. On December 6, 2012, the court appointed the lead plaintiff and lead plaintiff’s counsel.

On November 6, 2012, R. David Wolfe, a purported shareholder, filed a putative class action in the United States District Court for the Northern District of Ohio against American Greetings Corporation, certain members of the Weiss family, the Irving I. Stone Oversight Trust, Irving Stone Limited Liability Company, Irving I. Stone Support Foundation and Irving I. Stone Foundation, alleging breach of fiduciary duties against certain Weiss defendants by proposing and pursuing the Going Private Proposal (the “Wolfe Litigation”) and seeking declaratory relief. Shortly thereafter, on November 9, 2012, the Louisiana Municipal Police Employees’ Retirement System filed a similar, purported class action against the same defendants as the Wolfe Litigation, also alleging breach of fiduciary duties against certain Weiss defendants and seeking declaratory relief (the “LMPERS Litigation”).

On November 30, 2012, the Wolfe Litigation plaintiff filed Motions to (1) Consolidate the Wolfe and LMPERS Litigations; (2) for Appointment as Co-lead Plaintiff; (3) for Appointment as Co-Lead Plaintiff’s Counsel, and (4) for Partial Summary Judgment. On December 14, 2012, the Corporation filed its Oppositions to the Motions (a) to Consolidate the Wolfe and LMPERS Litigation, (b) for Appointment as Co-Lead Plaintiff and (c) for Appointment as Co-Lead Plaintiff’s Counsel. On the same day, American Greetings Corporation also filed a Motion to Dismiss the action.

Management is unable to estimate a range of reasonably possible losses for these cases in which the damages have not been specified and (i) the proceedings are in the early stages, (ii) there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class, (iii) there is uncertainty as to the outcome of the pending appeals or motions, (iv) there are significant factual issues to be resolved, and/or (v) there are novel legal issues presented. However, for these cases, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material adverse effect on the Corporation’s financial condition, though the outcomes could be material to the Corporation’s operating results for any particular period, depending, in part, upon the operating results for such period.

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Deferred Costs

9 Months Ended

Nov. 23, 2012

Deferred Costs

Note 10—Deferred Costs

Deferred costs and future payment commitments for retail supply agreements are included in the following financial statement captions:

(In thousands)	November 23, 2012			February 29, 2012			November 25, 2011
Prepaid expenses and other	$	98,211		$	94,071		$	93,553
Other assets		346,056			395,397			307,611
Deferred cost assets		444,267			489,468			401,164
Other current liabilities		(43,654	)		(45,891	)		(58,950	)
Other liabilities		(124,353	)		(137,360	)		(64,154	)
Deferred cost liabilities		(168,007	)		(183,251	)		(123,104	)
Net deferred costs	$	276,260		$	306,217		$	278,060

The Corporation maintains an allowance for deferred costs related to supply agreements of $7.8 million, $10.0 million and $10.0 million at November 23, 2012, February 29, 2012 and November 25, 2011, respectively. This allowance is included in “Other assets” in the Consolidated Statement of Financial Position.

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Income Taxes - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended					12 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012	Nov. 25, 2011	Nov. 23, 2012 Internal Revenue Service (IRS) [Member]	Nov. 23, 2012 U.S. State and Local Jurisdiction [Member]	Nov. 23, 2012 International Tax Jurisdiction [Member]	Feb. 02, 2013 Subsequent Event [Member]
Deferred Tax Liability Not Recognized [Line Items]
Effective tax rate	61.50%	31.80%	2.80%	36.20%
Unrecognized tax benefits	$ 27.4		$ 27.4
Income tax expenses affected by unrecognized tax benefits if recognized	17.1		17.1
Reductions in unrecognized tax benefits								(3)
Decreased unrecognized tax benefit								(9)
Reductions in unrecognized tax benefits related to the release of reserves upon the lapse of applicable statutes								1
Reductions in unrecognized tax benefits related to payments to various U.S. state and local jurisdictions to settle certain open years								1
Reductions in unrecognized tax benefits related to a decrease in estimated accruals and settlements related to open years under federal and state examination								1
Interest and penalties on unrecognized tax benefit			0.3
Accrued Interest and penalties on unrecognized tax benefit	$ 8.2		$ 8.2
Open tax years by major tax jurisdiction					2006 to the present	1996 to the present	2006 to the present

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Customer Allowances and Discounts

9 Months Ended

Nov. 23, 2012

Customer Allowances and Discounts

Note 8—Customer Allowances and Discounts

Trade accounts receivable is reported net of certain allowances and discounts. The most significant of these are as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Allowance for seasonal sales returns	$	35,506	$	34,285	$	47,496
Allowance for outdated products		11,850		10,976		9,937
Allowance for doubtful accounts		5,670		4,480		7,031
Allowance for marketing funds		29,599		26,679		29,710
Allowance for rebates		30,012		27,648		28,465
	$	112,637	$	104,068	$	122,639

Certain customer allowances and discounts are settled in cash. These accounts, primarily rebates, which are classified as “Accrued liabilities” on the Consolidated Statement of Financial Position, totaled $14.0 million, $13.7 million and $13.3 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

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Inventories

9 Months Ended

Nov. 23, 2012

Inventories

Note 9—Inventories

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
Raw materials	$	18,803	$	17,565	$	16,912
Work in process		7,051		9,452		8,294
Finished products		302,101		242,767		251,213
		327,955		269,784		276,419
Less LIFO reserve		82,976		81,077		81,515
		244,979		188,707		194,904
Display materials and factory supplies		19,351		20,238		19,508
	$	264,330	$	208,945	$	214,412

The valuation of inventory under the Last-In, First-Out (“LIFO”) method is made at the end of each fiscal year based on inventory levels and costs at that time. Accordingly, interim LIFO calculations, by necessity, are based on estimates of expected fiscal year-end inventory levels and costs, and are subject to final fiscal year-end LIFO inventory calculations.

Inventory held on location for retailers with scan-based trading arrangements, which is included in finished products, totaled $72.5 million, $52.0 million and $61.5 million as of November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

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Debt

9 Months Ended

Nov. 23, 2012

Debt

Note 11—Debt

As of November 23, 2012, the Corporation had a $400 million revolving credit facility, which expires in June 2015, and an accounts receivable facility that provides funding of up to $50 million. During the current quarter, on September 21, 2012, the accounts receivable facility was amended to decrease the amount of available financing thereunder from $70 million to $50 million. Also, on September 21, 2012, the liquidity commitments under the accounts receivable facility were renewed for an additional year and the facility’s term was extended an additional three years from September 21, 2012 to October 1, 2015. As of November 23, 2012, there was $131.7 million outstanding under the Corporation’s revolving credit facility, bearing interest at a rate of approximately 1.5%. There were no balances outstanding under the Corporation’s accounts receivable facility at November 23, 2012. The Corporation had, in the aggregate, $30.6 million outstanding under letters of credit under these borrowing agreements, which reduces the total credit available to the Corporation thereunder.

There were no balances outstanding under the Corporation’s revolving credit facility or accounts receivable facility at February 29, 2012 and November 25, 2011, respectively.

Long-term debt and their related calendar year due dates, net of unamortized discounts, which were zero as of November 23, 2012 and February 29, 2012, respectively, and $20.2 million as of November 25, 2011, were as follows:

(In thousands)	November 23, 2012		February 29, 2012		November 25, 2011
7.375% senior notes, due 2021	$	225,000	$	225,000	$	—
Revolving credit facility, due 2015		131,651		—		—
7.375% senior notes, due 2016		—		—		213,864
7.375% notes, due 2016		—		—		20,597
6.10% senior notes, due 2028		181		181		181
	$	356,832	$	225,181	$	234,642

The total fair value of the Corporation’s publicly traded debt, which was considered a Level 1 valuation as it was based on quoted market prices, was $241.9 million (at a carrying value of $225.2 million), $239.6 million (at a carrying value of $225.2 million) and $243.6 million (at a carrying value of $234.6 million) at November 23, 2012, February 29, 2012 and November 25, 2011, respectively.

The total fair value of the Corporation’s non-publicly traded debt, which was considered a Level 2 valuation as it was based on comparable privately traded debt prices, was $131.7 million (at a carrying value of $131.7 million) at November 23, 2012.

On December 19, 2012, the Corporation amended its credit agreement to modify the definition of Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) to permit, as of November 23, 2012, certain add-backs related to specific non-recurring expenses related to the Clinton Cards acquisition. At November 23, 2012, the Corporation was in compliance with the financial covenants under its borrowing agreements, as amended.

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Non-Binding Proposal by Members of the Weiss Family and Related Entities to Acquire the Corporation - Additional Information (Detail) (USD $)	1 Months Ended
	Sep. 30, 2012
Pending Status of Going Private Transaction [Line Items]
Outstanding Class A and Class B common shares, price per share	$ 17.18

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Business Segment Information (Tables)

9 Months Ended

Nov. 23, 2012

Schedule of Segment Reporting Information by Segment

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Total Revenue:
North American Social Expression Products	$	333,852		$	333,305		$	908,267		$	902,333
International Social Expression Products		101,972			103,352			239,486			249,448
Intersegment items		(25,538	)		—			(39,080	)		—
Net		76,434			103,352			200,406			249,448
Retail Operations		67,635			—			107,519			—
AG Interactive		15,982			16,878			47,255			49,664
Non-reportable segments		12,911			11,472			30,309			37,452
	$	506,814		$	465,007		$	1,293,756		$	1,238,897
Segment (Loss) Earnings:
North American Social Expression Products	$	22,099		$	28,016		$	98,757		$	113,009
International Social Expression Products		3,413			9,537			(18,855	)		15,308
Intersegment items		(4,123	)		—			(11,525	)		—
Net		(710	)		9,537			(30,380	)		15,308
Retail Operations		(11,473	)		—			(16,579	)		—
AG Interactive		5,331			3,737			13,713			10,970
Non-reportable segments		3,259			2,368			5,501			17,467
Unallocated
Interest expense		(4,504	)		(5,853	)		(13,314	)		(17,708	)
Profit-sharing plan expense		(423	)		(1,078	)		(3,852	)		(6,308	)
Stock-based compensation expense		(2,965	)		(2,676	)		(7,806	)		(8,038	)
Corporate overhead expense		(12,713	)		(4,351	)		(43,790	)		(19,257	)
		(20,605	)		(13,958	)		(68,762	)		(51,311	)
	$	(2,099	)	$	29,700		$	2,250		$	105,443

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Deferred Costs (Detail) (USD $) In Thousands, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Deferred Costs and Future Payment Commitment for Retail Supply Agreements [Line Items]
Prepaid expenses and other	$ 98,211	$ 94,071	$ 93,553
Other assets	346,056	395,397	307,611
Deferred cost assets	444,267	489,468	401,164
Other current liabilities	(43,654)	(45,891)	(58,950)
Other liabilities	(124,353)	(137,360)	(64,154)
Deferred cost liabilities	(168,007)	(183,251)	(123,104)
Net deferred costs	$ 276,260	$ 306,217	$ 278,060

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Business Segment Information

9 Months Ended

Nov. 23, 2012

Business Segment Information

Note 16—Business Segment Information

The Corporation has North American Social Expression Products, International Social Expression Products, Retail Operations, AG Interactive and non-reportable segments. The North American Social Expression Products and International Social Expression Products segments primarily design, manufacture and sell greeting cards and other related products through various channels of distribution with mass merchandise retailers as the primary channel. At November 23, 2012, the Corporation operated approximately 400 card and gift retail stores in the United Kingdom through its Retail Operations segment. The stores sell products purchased from the International Social Expression Products segment as well as products purchased from other vendors. AG Interactive distributes social expression products, including electronic greetings and a broad range of graphics and digital services and products, through a variety of electronic channels, including Web sites, Internet portals, instant messaging services and electronic mobile devices. The Corporation’s non-reportable operating segments primarily include licensing activities and the design, manufacture and sale of display fixtures.

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Total Revenue:
North American Social Expression Products	$	333,852		$	333,305		$	908,267		$	902,333
International Social Expression Products		101,972			103,352			239,486			249,448
Intersegment items		(25,538	)		—			(39,080	)		—
Net		76,434			103,352			200,406			249,448
Retail Operations		67,635			—			107,519			—
AG Interactive		15,982			16,878			47,255			49,664
Non-reportable segments		12,911			11,472			30,309			37,452
	$	506,814		$	465,007		$	1,293,756		$	1,238,897
Segment (Loss) Earnings:
North American Social Expression Products	$	22,099		$	28,016		$	98,757		$	113,009
International Social Expression Products		3,413			9,537			(18,855	)		15,308
Intersegment items		(4,123	)		—			(11,525	)		—
Net		(710	)		9,537			(30,380	)		15,308
Retail Operations		(11,473	)		—			(16,579	)		—
AG Interactive		5,331			3,737			13,713			10,970
Non-reportable segments		3,259			2,368			5,501			17,467
Unallocated
Interest expense		(4,504	)		(5,853	)		(13,314	)		(17,708	)
Profit-sharing plan expense		(423	)		(1,078	)		(3,852	)		(6,308	)
Stock-based compensation expense		(2,965	)		(2,676	)		(7,806	)		(8,038	)
Corporate overhead expense		(12,713	)		(4,351	)		(43,790	)		(19,257	)
		(20,605	)		(13,958	)		(68,762	)		(51,311	)
	$	(2,099	)	$	29,700		$	2,250		$	105,443

Consolidated operating results include the operating results of the Retail Operations segment from the acquisition date of June 6, 2012 until October 27, 2012, the end of the segment’s third fiscal quarter.

“Corporate overhead expense” includes costs associated with corporate operations including, among other costs, senior management, corporate finance, legal and insurance programs.

See Note 4 for segment information related to certain charges associated with activities and transactions in connection with Clinton Cards that do not have comparative amounts in the prior year.

Termination Benefits

Termination benefits are primarily considered part of an ongoing benefit arrangement, accounted for in accordance with ASC Topic 712, “Compensation – Nonretirement Postemployment Benefits,” and are recorded when payment of the benefits is probable and can be reasonably estimated.

The balance of the severance accrual was $4.7 million, $6.8 million and $3.8 million at November 23, 2012, February 29, 2012 and November 25, 2011, respectively. The payments expected within the next twelve months are included in “Accrued liabilities” while the remaining payments beyond the next twelve months are included in “Other liabilities” on the Consolidated Statement of Financial Position.

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Other Income and Expense (Tables)

9 Months Ended

Nov. 23, 2012

Other Operating Expense - Net

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of intellectual properties	$	—		$	—		$	—		$	(4,500	)
Termination of certain agency agreements		—			—			2,125			—
Miscellaneous		(2,217	)		(813	)		(3,546	)		(2,358	)
Other operating income – net	$	(2,217	)	$	(813	)	$	(1,421	)	$	(6,858	)

Other Non-Operation Income and Expenses

The proceeds of $4.5 million were included in “Proceeds from sale of intellectual properties” on the Consolidated Statement of Cash Flows.

	Three Months Ended						Nine Months Ended
(In thousands)	November 23, 2012			November 25, 2011			November 23, 2012			November 25, 2011
Gain on sale of Party City investment	$	(1,141	)	$	—		$	(4,293	)	$	—
Loss on Clinton Cards debt		—			—			10,043			—
Foreign exchange gain		(552	)		(1,500	)		(948	)		(631	)
Rental income		(450	)		(238	)		(1,496	)		(977	)
Loss (gain) on asset disposal		240			(323	)		394			(807	)
Miscellaneous		(1	)		(16	)		(177	)		(206	)
Other non-operating (income) expense – net	$	(1,904	)	$	(2,077	)	$	3,523		$	(2,621	)

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Inventories (Detail) (USD $) In Thousands, unless otherwise specified	Nov. 23, 2012	Feb. 29, 2012	Nov. 25, 2011
Inventories [Line Items]
Raw materials	$ 18,803	$ 17,565	$ 16,912
Work in process	7,051	9,452	8,294
Finished products	302,101	242,767	251,213
Inventory, Gross, Total	327,955	269,784	276,419
Less LIFO reserve	82,976	81,077	81,515
Inventory Net Of Last In First Out Reserve, Total	244,979	188,707	194,904
Display materials and factory supplies	19,351	20,238	19,508
Inventories	$ 264,330	$ 208,945	$ 214,412

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Royalty Revenue and Related Expenses - Additional Information (Detail) (AG Intellectual Properties [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	May 25, 2012	Nov. 23, 2012
AG Intellectual Properties [Member]
Segment Reporting Information [Line Items]
License charges	$ 2,100	$ 2,125

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CONSOLIDATED STATEMENT OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011
OPERATING ACTIVITIES:
Net income	$ 2,187	$ 67,315
Adjustments to reconcile net income to cash flows from operating activities:
Stock-based compensation	7,806	8,038
Gain on dispositions		(4,500)
Net loss (gain) on disposal of fixed assets	394	(807)
Depreciation and intangible assets amortization	36,095	32,993
Provision for doubtful accounts	17,771	4,879
Impairment of Clinton Cards debt	10,043
Deferred income taxes	809	6,412
Gain on sale of Party City investment	(4,293)
Other non-cash charges	892	2,747
Changes in operating assets and liabilities, net of acquisitions:
Trade accounts receivable	(101,363)	(122,298)
Inventories	(39,105)	(30,939)
Other current assets	(17,877)	6,470
Income taxes	(15,336)	3,362
Deferred costs - net	23,702	(3,838)
Accounts payable and other liabilities	112,283	3,528
Other - net	(1,913)	98
Total Cash Flows From Operating Activities	32,095	(26,540)
INVESTING ACTIVITIES:
Property, plant and equipment additions	(87,408)	(48,956)
Cash payments for business acquisitions, net of cash acquired	621	(5,899)
Proceeds from sale of fixed assets	559	9,046
Proceeds from sale of intellectual properties		4,500
Proceeds from sale of Party City investment	4,920
Purchase of Clinton Cards debt	(56,560)
Total Cash Flows From Investing Activities	(137,868)	(41,309)
FINANCING ACTIVITIES:
Net increase in long-term debt	131,651
Issuance or exercise of share-based payment awards	(496)	12,293
Tax (deficiency) benefit from share-based payment awards	(376)	2,380
Purchase of treasury shares	(78,742)	(55,304)
Dividends to shareholders	(15,182)	(18,146)
Total Cash Flows From Financing Activities	36,855	(58,777)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	(229)	(3,551)
DECREASE IN CASH AND CASH EQUIVALENTS	(69,147)	(130,177)
Cash and Cash Equivalents at Beginning of Year	132,438	215,838
Cash and Cash Equivalents at End of Period	$ 63,291	$ 85,661

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Royalty Revenue and Related Expenses

9 Months Ended

Nov. 23, 2012

Royalty Revenue and Related Expenses

Note 5—Royalty Revenue and Related Expenses

The Corporation has agreements for licensing the Care Bears and Strawberry Shortcake characters and other intellectual property. These license agreements provide for royalty revenue to the Corporation, which is recorded in “Other revenue” on the Consolidated Statement of Operations. These license agreements may include the receipt of upfront advances, which are recorded as deferred revenue and earned during the period of the agreement. Expenses associated with the servicing of these agreements, primarily relating to the licensing activities included in non-reportable segments, are summarized as follows:

	Three Months Ended				Nine Months Ended
(In thousands)	November 23, 2012		November 25, 2011		November 23, 2012		November 25, 2011
Royalty revenue	$	7,085	$	6,401	$	17,947	$	20,785
Royalty expenses
Material, labor and other production costs	$	2,794	$	2,789	$	7,795	$	7,781
Selling, distribution and marketing expenses		1,856		2,621		5,235		7,345
Administrative and general expenses		467		431		1,330		1,292
	$	5,117	$	5,841	$	14,360	$	16,418

In addition to the expenses disclosed above, the Corporation incurred charges of $2.1 million associated with its licensing business, which is included in “Other operating income – net” on the Consolidated Statement of Operations. See Note 6 for further information.

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Fair Value Measurements - Assets and Liabilities Measured at Fair Value as of Measurement Date (Detail) (Fair Value, Measurements, Recurring, USD $) In Thousands, unless otherwise specified	Nov. 23, 2012		Feb. 29, 2012		Nov. 25, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total					$ 12,031
Deferred Compensation Plan Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured on a recurring basis	10,177	[1]	9,198	[1]	8,719	[1]
Active Employees' Medical Plan Trust Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured on a recurring basis					3,312
Quoted prices in active markets for identical assets and liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total					12,031
Quoted prices in active markets for identical assets and liabilities (Level 1) [Member] | Deferred Compensation Plan Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured on a recurring basis	10,177	[1]	9,198	[1]	8,719	[1]
Quoted prices in active markets for identical assets and liabilities (Level 1) [Member] | Active Employees' Medical Plan Trust Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured on a recurring basis					$ 3,312

[1] There is an offsetting liability for the obligation to its employees on the Corporation's books.

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(Loss) Earnings Per Share (Tables)

9 Months Ended

Nov. 23, 2012

Computation of Earnings per Share and Earnings per Share-Assuming Dilution

The following table sets forth the computation of (loss) earnings per share and (loss) earnings per share—assuming dilution:

	Three Months Ended					Nine Months Ended
	November 23, 2012			November 25, 2011		November 23, 2012		November 25, 2011
Numerator (in thousands):
Net (loss) income	$	(809	)	$	20,246	$	2,187	$	67,315
Denominator (in thousands):
Weighted average shares outstanding		31,877			39,481		33,712		40,226
Effect of dilutive securities:
Stock options and awards		—			956		767		1,155
Weighted average shares outstanding – assuming dilution		31,877			40,437		34,479		41,381
(Loss) earnings per share	$	(0.03	)	$	0.51	$	0.06	$	1.67
(Loss) earnings per share – assuming dilution	$	(0.03	)	$	0.50	$	0.06	$	1.63

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Acquisition - Charges Reflected in Reportable Segment (Detail) (USD $)	9 Months Ended		3 Months Ended		9 Months Ended
	Nov. 23, 2012	Nov. 25, 2011	Aug. 24, 2012 Clinton Cards [Member]	May 25, 2012 Clinton Cards [Member]	Nov. 23, 2012 Clinton Cards [Member]	Nov. 23, 2012 Clinton Cards [Member] International Social Expression Products [Member]	Nov. 23, 2012 Clinton Cards [Member] Unallocated [Member]
Operating Statistics [Line Items ]
Contract asset impairment				$ 4,000,000	$ 4,000,000	$ 4,000,000
Bad debt expense	17,771,000	4,879,000		17,200,000	17,200,000	17,200,000
Legal and advisory fees					6,300,000		6,300,000
Impairment of debt purchased	10,043,000		2,200,000	7,800,000	10,000,000		10,000,000
Total					$ 37,500,000	$ 21,200,000	$ 16,300,000

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Income Taxes

9 Months Ended

Nov. 23, 2012

Income Taxes

Note 15—Income Taxes

The Corporation’s provision for income taxes in interim periods is computed by applying its estimated annual effective tax rate against income (loss) before income tax expense (benefit) for the period. In addition, non-recurring or discrete items are recorded during the period in which they occur. The magnitude of the impact that discrete items have on the Corporation’s quarterly effective tax rate is dependent on the level of income in the period. The effective tax rate was 61.5% and 2.8% for the three and nine months ended November 23, 2012, respectively, and 31.8% and 36.2% for the three and nine months ended November 25, 2011, respectively. The lower than statutory rate for the nine months ended November 23, 2012 is due primarily to the release of reserves upon lapse of the applicable statutes and lower taxable income.

At November 23, 2012, the Corporation had unrecognized tax benefits of $27.4 million that, if recognized, would have a favorable effect on the Corporation’s income tax expense of $17.1 million. During 2013, the Corporation’s unrecognized tax benefits decreased approximately $3 million, of which approximately $1 million relates to the release of reserves upon the lapse of applicable statutes, approximately $1 million relates to payments to various U.S. state and local jurisdictions to settle certain open years which were under examination and approximately $1 million relates to a decrease in estimated accruals and settlements related to open years under federal and state examination. It is reasonably possible that the Corporation’s unrecognized tax positions as of November 23, 2012 could decrease approximately $9 million during the next twelve months due to anticipated settlements and resulting cash payments related to open years after 1996, which are currently under examination.

The Corporation recognizes interest and penalties accrued on unrecognized tax benefits and refundable income taxes as a component of income tax expense. During the nine months ended November 23, 2012, the Corporation recognized net expense of $0.3 million for interest and penalties on unrecognized tax benefits and refundable income taxes. As of November 23, 2012, the total amount of gross accrued interest and penalties related to unrecognized tax benefits less refundable income taxes was a net payable of $8.2 million.

The Corporation is subject to examination by the Internal Revenue Service for tax years 2006 to the present and various U.S. state and local jurisdictions for tax years 1996 to the present. The Corporation is also subject to tax examination in various international tax jurisdictions, including Canada, the United Kingdom, Australia, Italy, Mexico and New Zealand for tax years 2006 to the present.