UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549



Form 10-Q



|[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------------



For the quarterly period ended December 31, 2006



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 000-13225



VPGI CORP.



|Texas                           | 75-1975147                          
|------------------------------- | ------------------------------------
|(State or other jurisdiction of | (I.R.S. Employer Identification No.)
|incorporation or organization)  |                                     

700 Gemini, Suite 100, Houston, TX 77056



(281) 488-3883(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 is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of "accelerated filer and large accelerated filer" in rule 12b-2 of the Exchange Act.

|Large accelerated filer | Accelerated filer | Non-accelerated filer X
|----------------------- | ----------------- | -----------------------

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act).		
YES ____     NO X

At February 14, 2007, there were 7,707,791 shares of Registrant's common stock outstanding.



|              | GENERAL INDEX                                                                         |            
|------------- | ------------------------------------------------------------------------------------- | -----------
|              |                                                                                       | Page Number
|              |                                                                                       |            
|              |                                                                                       |            
|              | PART I.                                                                               |            
|              | FINANCIAL INFORMATION                                                                 |            
|              |                                                                                       |            
|ITEM 1.       | CONDENSED CONSOLIDATED FINANCIAL STATEMENTS                                           | 3          
|              |                                                                                       |            
|ITEM 2.       | MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 10         
|              |                                                                                       |            
|ITEM 3.       | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
 MARKET RISK                           | 12         
|              |                                                                                       |            
|ITEM 4.       | CONTROLS AND PROCEDURES                                                               | 12         
|              |                                                                                       |            
|              | PART II.                                                                              |            
|              | OTHER INFORMATION                                                                     |            
|              |                                                                                       |            
|ITEM 2.       | UNREGISTERED SALES OF EQUITY SECURITIES AND
USE OF PROCEEDS                           | 12         
|              |                                                                                       |            
|ITEM 5.       | OTHER INFORMATION                                                                     | 13         
|              |                                                                                       |            
|ITEM 6.       | EXHIBITS                                                                              | 13         
|              |                                                                                       |            
|SIGNATURES    | 13                                                                                   
|              |                                                                                       |            
|EXHIBIT INDEX | 14                                                                                   





PART I  -  FINANCIAL INFORMATION



ITEM 1.	FINANCIAL STATEMENTS



|VPGI Corp. and Subsidiaries                                                          |                           |                      |        |            
|------------------------------------------------------------------------------------ | ------------------------- | -------------------- | ------ | -----------
|(A Development Stage Company)                                                        |                           |                      |        |            
|Condensed Consolidated Balance Sheets                                                |                           |                      |        |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           |                      |        | December 31
|                                                                                     |                           |                      |        | 2006       
|                                                                                     |                           |                      |        | (Unaudited)
|                                                                                     |                           | ASSETS               |        |            
|                                                                                     |                           |                      |        |            
|CURRENT ASSETS                                                                       |                           |                      |        |            
|                                                                                     | Cash and cash equivalents | $                    | 1,791  | $          
|                                                                                     | Prepaid expenses          |                      | 21,182 |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           | Total current assets |        | 22,973     
|                                                                                     |                           |                      |        |            
|OTHER ASSETS                                                                         |                           |                      |        |            
|                                                                                     | Pension surplus           |                      | 55,530 |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           | Total other assets   |        | 55,530     
|                                                                                     |                           |                      |        |            
|                                                                                     |                           |                      |        |            
|                                                                                     |                           | Total assets         | $      | 78,503     
|                                                                                     |                           |                      |        |            
|                                                                                     |                           |                      |        |            
|The accompanying notes are an integral part of these condensed financial statements.



|VPGI Corp. and Subsidiaries                                                          |                                                                              |                                                                                                                  |              |            
|------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------- | ------------ | -----------
|(A Development Stage Company                                                         |                                                                              |                                                                                                                  |              |            
|Condensed Consolidated Balance Sheets                                                |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              |                                                                                                                  |              | December 31
|                                                                                     |                                                                              |                                                                                                                  |              | 2006       
|                                                                                     |                                                                              | LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                            |              | (Unaudited)
|                                                                                     |                                                                              |                                                                                                                  |              |            
|CURRENT LIABILITIES                                                                  |                                                                              |                                                                                                                  |              |            
|                                                                                     | Note payable, net of deferred loan costs                                     | $                                                                                                                | -            | $          
|                                                                                     | Trade accounts payable                                                       |                                                                                                                  | 81,967       |            
|                                                                                     | Accrued expenses                                                             |                                                                                                                  | 36,340       |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              | Total liabilities                                                                                                |              | 118,307    
|                                                                                     |                                                                              |                                                                                                                  |              |            
|STOCKHOLDERS' DEFICIT                                                                |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     | Preferred stock, cumulative, $1.00 par value; 1,000,000 shares
  authorized: |                                                                                                                  |              |            
|                                                                                     |                                                                              | Series A, -0- and 30,000 shares issued and outstanding                                                           |              |            
|                                                                                     |                                                                              | at December 31 and June 30, 2006, respectively                                                                   |              |            
|                                                                                     |                                                                              | (liquidation preference of $0 and $30,000 at                                                                     |              |            
|                                                                                     |                                                                              | December 31 and June 30, 2006, respectively)                                                                     |              | --         
|                                                                                     |                                                                              | Series H, -0- and 2 shares issued and outstanding at                                                             |              |            
|                                                                                     |                                                                              | December 31 and June 30, 2006, respectively                                                                      |              |            
|                                                                                     |                                                                              | (liquidation preference of $0 and $50,000 at                                                                     |              |            
|                                                                                     |                                                                              | December 31 and June 30, 2006, respectively)                                                                     |              | --         
|                                                                                     |                                                                              | Series K, 20 shares issued and outstanding                                                                       |              |            
|                                                                                     |                                                                              | (liquidation preference of $500,000)                                                                             |              | 20         
|                                                                                     |                                                                              | Series 2002-G, 6 and 152 shares issued and outstanding                                                           |              |            
|                                                                                     |                                                                              | at December 31 and June 30, 2006, respectively                                                                   |              |            
|                                                                                     |                                                                              | (liquidation preference of $150,000 and $3.8 million                                                             |              |            
|                                                                                     |                                                                              | at December 31 and June 30, 2006, respectively)                                                                  |              | 6          
|                                                                                     |                                                                              | Series 2004-L, -0- and 175 shares issued and                                                                     |              |            
|                                                                                     |                                                                              | outstanding at December 31 and June 30, 2006,                                                                    |              |            
|                                                                                     |                                                                              | respectively (liquidation preference of $0 and $1.75                                                             |              | -          
|                                                                                     |                                                                              | million at December 31 and June 30, 2006,                                                                        |              |            
|                                                                                     |                                                                              | respectively                                                                                                     |              |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     | Common stock, $.001 par value; 80,000,000 shares                             |                                                                                                                  |              |            
|                                                                                     |                                                                              | authorized; 6,980,791 and 137,909  shares issued and
 outstanding at December 31 and June 30, 2006, respectively |              | 6,981      
|                                                                                     | Additional paid in capital                                                   |                                                                                                                  | 62,027,509   |            
|                                                                                     | Accumulated deficit                                                          |                                                                                                                  | (60,362,084) |            
|                                                                                     | Deficit accumulated during development stage                                 |                                                                                                                  | (1,712,236)  |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              | Total stockholders' deficit                                                                                      |              | (39,804)   
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              | Total liabilities and stockholders' deficit                                                                      | $            | 78,503     
|                                                                                     |                                                                              |                                                                                                                  |              |            
|                                                                                     |                                                                              |                                                                                                                  |              |            
|The accompanying notes are an integral part of these condensed financial statements.



|VPGI Corp. and Subsidiaries                                                |                                        
|-------------------------------------------------------------------------- | ---------------------------------------
|(A Development Stage Company)                                              |                                        
|Condensed Consolidated Statements of Operations (Unaudited                 |                                        
|                                                                          
|                                                                          
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|Revenues                                                                   |                                        
|                                                                           | Product sales                          
|                                                                           | Consulting and support services        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|Cost of products and services                                              |                                        
|                                                                           | Cost of product sales                  
|                                                                           | Cost of consulting and support services
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|Operating expenses                                                         |                                        
|                                                                           | General and administrative             
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|Other (income) expense                                                     |                                        
|                                                                           | Other income                           
|                                                                           | Interest expense                       
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|                                                                           |                                        
|Dividend requirements on preferred stock                                   |                                        
|                                                                           |                                        
|Net loss attributable to common stockholders                               |                                        
|                                                                           |                                        
|                                                                           |                                        
|Net loss per share attributable to common stockholders - basic and diluted |                                        
|                                                                           |                                        
|Weighted average common shares outstanding - basic and diluted             |                                        
|                                                                           |                                        
|The accompanying notes are an integral part of these condensed statements.









|VPGI CORP. and Subsidiaries                                               |                                                                         |                                                               |                                                           |                                                                         |           |         
|------------------------------------------------------------------------- | ----------------------------------------------------------------------- | ------------------------------------------------------------- | --------------------------------------------------------- | ----------------------------------------------------------------------- | --------- | --------
|(A Development Stage Company                                              |                                                                         |                                                               |                                                           |                                                                         |           |         
|Condensed Consolidated Statements of Cash Flows (Unaudited)               |                                                                         |                                                               |                                                           |                                                                        
|Six Months Ended December 31,                                             |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         |                                                               |                                                           | Cumulative During Development Stage (July 1, 2004 to
December 31, 2006) |           | 2006    
|Cash flows from operating activities                                      |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          | Net loss                                                                | $                                                             | (1,388,817)                                               | $                                                                       | (170,399) | $       
|                                                                          | Adjustments to reconcile net loss to cash used in operating activities: |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         | Amortization of debt discount                                 |                                                           | 166,216                                                                 |           | 3,184   
|                                                                          |                                                                         | Issuance of warrants for services                             |                                                           | 10,000                                                                  |           | -       
|                                                                          |                                                                         | Write-off of acquired in-process research and 
   Development |                                                           | 146,819                                                                 |           | -       
|                                                                          |                                                                         | Changes in operating assets and liabilities                   |                                                           |                                                                         |           |         
|                                                                          |                                                                         |                                                               | Trade accounts receivable                                 |                                                                         | -         |         
|                                                                          |                                                                         |                                                               | Prepaid and other assets                                  |                                                                         | (26,740)  |         
|                                                                          |                                                                         |                                                               | Accounts payable and accrued liabilities                  |                                                                         | 162,680   |         
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         |                                                               | Cash and cash equivalents used in    operating activities |                                                                         | (929,842) |         
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|Cash flows from investing activities                                      |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         | Cash and cash equivalents used in investing  activities       |                                                           | -                                                                       |           | -       
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|Cash flows from financing activities                                      |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          | Preferred stock dividend paid                                           |                                                               | (20,067)                                                  |                                                                         | -         |         
|                                                                          | Proceeds from issuance of notes payable                                 |                                                               | 951,700                                                   |                                                                         | 50,000    |         
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|                                                                          |                                                                         | Cash and cash equivalents provided by financing activities    |                                                           | 931,633                                                                 |           | 50,000  
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|Net increase (decrease) in cash and cash equivalents                      |                                                                         | 1,791                                                         |                                                           | (9,241)                                                                 |           | (44,595)
|Cash and cash equivalents, beginning of period                            |                                                                         | -                                                             |                                                           | 11,032                                                                  |           | 53,337  
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|Cash and cash equivalents, end of period                                  | $                                                                       | 1,791                                                         | $                                                         | 1,791                                                                   | $         | 8,742   
|                                                                          |                                                                         |                                                               |                                                           |                                                                         |           |         
|The accompanying notes are an integral part of these condensed statements



.

VPGI CORP. and Subsidiaries
(A Development Stage Company)



NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006
(Unaudited)



BASIS OF PRESENTATION

The interim consolidated financial statements and summarized notes included herein were prepared, without audit, in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim financial information, pursuant to rules and regulations of the Securities and Exchange Commission.  Because certain information and notes normally included in complete financial statements prepared in accordance with U.S. GAAP were condensed or omitted pursuant to such rules and regulations, it is suggested that these financial statements be read in conjunction with the Consolidated Financial Statements and the Notes thereto, included in the Company's Annual Report on Form 10-K for the preceding fiscal year.  These interim financial statements and notes hereto reflect all normal, recurring adjustments which are, in the opinion of management, necessary for a fair statement of results for the interim periods presented.  Such financial results, however, should not be construed as necessarily indicative of future earnings.



On September 5, 2006, stockholders approved a one for fifty (1:50) reverse split of all outstanding shares of the Company's common stock and the reverse split was implemented on September 18, 2006.  The par value remained at $.001 per share and the authorized number of common shares was maintained at 80,000,000.  All share and per share data give effect to the reverse stock split, applied retroactively as if it occurred on July 1, 2005

GOING CONCERN MATTERS





The Company is actively seeking a merger candidate, an acquisition of a viable business or a buyer of the corporate entity.



On November 6, 2006, substantially all outstanding debt was eliminated as explained in the footnote "NOTES PAYABLE."

The financial statements do not include any adjustment to reflect the possible effects on the recoverability and classification of assets or liabilities which may result from the inability of the Company to continue as a going concern.

DEVELOPMENT STAGE COMPANY

The Company previously offered enhanced digital media solutions, as well as contact center customer service solutions through CIMphonyTM, a suite of computer telephony integration software products and services.  This operation was discontinued in December 2002.  Effective July 1, 2004, the Company's management has devoted substantially all of its time to the planning and acquisition of new operations.  On November 10, 2004, the Company acquired Venture Pacific Group, Inc. ("VPG") to capitalize upon and apply its technical expertise and its existing technologies to the field of radio frequency identification ("RFID").  Since November 10, 2004, the Company has been relying primarily on borrowings for its primary source of cash flow.  Accordingly, the Company's financial statements are presented as those of a development stage enterprise, as prescribed by Statement of Financial Accounting Standard No. 7, Accounting and Reporting by Development Stage Enterprises.

NOTES PAYABLE

On November 10, 2004 the Company entered into a note payable with Trident Growth Fund, L.P. ("Trident") for $700,000, at an annual interest rate of 14%, maturing on November 10, 2005.  The loan is collateralized by a security interest in Company assets.  Interest is payable monthly in cash.



On August 10, 2005 the loan agreement was modified to change the loan amount from $700,000 to $750,000 and the Company entered into an additional note payable with Trident for $50,000 at an annual interest rate of 14%, maturing on August 10, 2006.  In connection with the $50,000 loan, the Company issued warrants to purchase 36,000 shares of its Common Stock, exercisable for five years at an exercise price of $.10 per share.  The warrants were valued at approximately $3,500.



On September 19, 2005 the loan agreement was again modified to change the loan amount from $750,000 to $850,000 and the Company entered into an additional note payable with Trident for $100,000 at an annual interest rate of 14%, maturing on September 19, 2006.  In connection with the $100,000 loan, the Company issued warrants to purchase 72,000 shares of its Common Stock, exercisable for five years at an exercise price of $.10 per share.  The warrants were valued at approximately $6,000.



On June 27, 2006 the loan agreement was again modified to change the loan amount from $950,000 to $996,000 and the Company entered into an additional note payable with Trident for $46,000 at an annual interest rate of 14%, maturing on February 7, 2007.  In connection with the $46,000 loan, the Company issued warrants to purchase 1,520 shares of its Common Stock, exercisable for five years at an exercise price of $5.00 per share.  The warrants were valued at approximately $3,345.



On July 19, 2006 the loan agreement was again modified to change the loan amount from $996,000 to $1,046,000 and the Company entered into an additional note payable with Trident for $50,000 at an annual interest rate of 14%, maturing on February 7, 2007.



On November 6, 2006, the Note Payable of $1,048,700 and accrued interest of $131,013 with Trident Growth Fund, L.P. was converted into 4,718,852 shares of Common Stock at a conversion price of $0.25 per share.  This transaction eliminated substantially all of the Company's outstanding debt.



CONVERSION OF PREFERRED STOCK



On September 20, 2006, the holder of 30,000 shares of the Company's Series A Preferred Stock, representing all of the issued and outstanding shares of Series A Preferred Stock, converted its holdings into shares of the Company's par value $.001 common stock ("Common Stock").  The preferred stock had a liquidation value of $30,000 and was converted into 600 shares of Common Stock at a conversion price of $50.00 per share.



On September 20, 2006, the holder of one (1) share of the Company's Series H Preferred Stock converted its holdings into Common Stock.  The preferred stock had a liquidation value of $25,000 and was converted into five (5) shares of Common Stock at a conversion price of $6,000.00 per share.  After the conversion, one (1) share of Series H Preferred Stock remained issued and outstanding.



On September 20, 2006, the holder of 86 shares of the Company's Series 2002-G Preferred Stock converted its holdings into Common Stock.  The preferred stock had a liquidation value of $2,150,000 and was converted into 28,667 shares of Common Stock at a conversion price of $75.00 per share.  After the conversion, sixty-six (66) shares of Series 2002-G Preferred Stock remained issued and outstanding.



On November 1, 2006, the holder of one (1) share of our Series H Preferred Stock converted its holdings into Common Stock.  The preferred stock had a liquidation value of $25,000 and was converted into five (5) shares of Common Stock at a conversion price of $6,000.00 per share.  After the conversion, no shares of Series H Preferred Stock remained issued and outstanding.



On November 6, 2006, the holder of 60 shares of our Series 2002-G Preferred Stock converted its holdings into Common Stock.  The preferred stock had a liquidation value of $1,500,000 and was converted into 20,000 shares of Common Stock at a conversion price of $75.00 per share.  After the conversion, six (6) shares of Series 2002-G Preferred Stock remained issued and outstanding.



On November 6, 2006, the holder of 175 shares of our Series 2004-L Preferred Stock, which represented all of the issued and outstanding shares of Series 2004-L Preferred Stock, converted its holdings into Common Stock.  The preferred stock had a liquidation value of $1,750,000 and had accrued dividends payable of $323,419; the preferred stock and accrued dividends were converted into a total of 2,073,419 shares of Common Stock at a conversion price of $1.00 per share.



LOSS PER SHARE

Basic loss per share is based upon the weighted average number of shares of common stock outstanding.  Diluted loss per share is based upon the weighted average number of shares of common stock outstanding plus the number of additional common shares that would have been outstanding if dilutive potential common shares had been issued.  In all periods presented, all potential common shares were anti-dilutive.

BUSINESS SEGMENT INFORMATION

The Company discontinued normal operations in December, 2002.  Since that date, no business segments have existed.

CONCENTRATION OF CREDIT RISK

There were no revenues or accounts receivable in the six months ended December 31, 2006.

RECENT PRONOUNCEMENTS

On September 29, 2006, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans("SFAS 158").  SFAS 158 requires employers to recognize the over-funded or under-funded status of a defined benefit postretirement plan as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through other comprehensive income.  SFAS 158 requires employers to measure the funded status of a plan as of the date of its year-end statement of financial position (with limited exceptions).

The Company is required to recognize the funded status of its defined benefit postretirement plan and to provide the required disclosures as of the end of the year ending June 30, 2007.  The requirement to measure plan assets and benefit obligations as of the date of the Company's fiscal year-end statement of financial position is effective for fiscal years ending after December 15, 2008.  As discussed in Note I to the Company's 2006 10K, the Company is in the process of terminating its defined benefit postretirement plan and settling its benefit obligations.  Based upon information as the measurement date of June 1, 2006, the impact of SFAS 158 would be to increase assets by $14,470 and increase equity by $14,470.  The actual impact of adoption of SFAS 158 could differ significantly from these estimates due to potential changes in underlying economic conditions which influence the assumptions used in the actuarial valuation of plan assets and obligations, including returns on pension assets, pension contributions and changes in interest rates.

RETIREMENT PLAN

Prior to a subsidiary's bankruptcy filing in 1992, the subsidiary had a defined benefit plan, which covered substantially all full-time employees.  All plan benefits were settled with the purchase of annuities totaling $583,730 on August 7, 2006.  The Company expects to terminate the plan and distribute remaining assets during the upcoming year. A final periodic benefit cost will be determined at that time.  The following table presents the components of net periodic pension cost recognized in earnings for the three months ended September 30, 2005 in accordance with the provisions of SFAS No. 132 (revised 2003), Employers' Disclosures about Pensions and Other Postretirement Benefits:

|                               | Six Months Ended
December 31, 2006
|------------------------------ | ----------------------------------
|Service cost                   | $        -                        
|Interest cost                  | 6,479                             
|Expected return on plan assets | (6,584)                           
|Net periodic benefit cost      | $  (105)                          

SUBSEQUENT EVENTS

On January 18, 2007, the holder of 20 shares of the Company's Series 2002-K Preferred Stock, representing all of the issued and outstanding shares of Series 2002-K Preferred Stock, converted its holdings into Common Stock.  The preferred stock had a liquidation value of $500,000 and was converted into 625,000 shares of Common Stock at a conversion price of $0.80 per share.





ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		CONDITION AND RESULTS OF OPERATIONS



Forward Looking Statements



This report may contain "Forward Looking Statements," which are our expectations, plans, and projections which may or may not materialize, and which are subject to various risks and uncertainties, including statements concerning expected expenses and the adequacy of our sources of cash to finance our current and future operations.  When used in this report, the words "plans," "believes," "expects," "anticipates," "estimates" and similar expressions are intended to identify forward-looking statements.  Factors which could cause actual results to materially differ from our expectations include the following:  general economic conditions and growth in the high tech industry; competitive factors and pricing pressures; changes in product mix; the timely development and acceptance of new products; and the risks described from time to time in our SEC filings.  These forward-looking statements speak only as of the date of this report.  We expressly disclaim any obligation or undertaking to release publicly any updates or change in our expectations or any change in events, conditions or circumstances on which any such statement may be based, except as may be otherwise required by the securities laws.

Overview



The Company previously offered enhanced digital media solutions, as well as contact center customer service solutions through CIMphonyTM, a suite of computer telephony integration software products and services.  This operation was discontinued in December 2002.  We acquired Venture Pacific Group, Inc. ("VPG") in November 2004 to capitalize upon and apply our technical expertise and our existing technologies to the field of radio frequency identification ("RFID").  We plan to participate in other business ventures and opportunities as they may present themselves.  Our new business model continues in the development stage and we are actively seeking a merger candidate, an acquisition of a viable business or a buyer of the corporate entity.



The following discussion provides information to assist in the understanding of our financial condition and results of operations for the fiscal quarter ended December 31, 2006.  It should be read in conjunction with the Consolidated Financial Statements and Notes thereto appearing in our Annual Report on Form 10-K for fiscal year ended June 30, 2006.



Results of Operations



Revenues.  We report no revenues for the three months and six months ended December 31, 2006 and no revenues for the three months and six months ended December 31, 2005.



Gross Margin.  Gross margin was zero for the three months and six months ended December 31, 2006 and the three months and six months ended December 31, 2005.



Operating Expenses.  Total operating expenses for the three months ended December 31, 2006 decreased to $57,580 compared to $88,802 for the same quarter last year.  Total operating expenses for the six months ended December 31, 2006 decreased to $122,014 compared to $247,054 for the same period last year.

|                                     |   | Three Months Ended |   | Six Months Ended
|------------------------------------ | - | ------------------ | - | ----------------
|                                     |   | December 31        |   | December 31     
|                                     |   | 2006               |   | 2005            
|                                     |   |                    |   |                 
|Compensation                         | $ | -                  | $ | 10,666          
|Legal expense and  professional fees |   | 40,670             |   | 8,488           
|Other                                |   | 16,910             |   | 69,648          
|                                     |   |                    |   |                 
|Total                                | $ | 57,580             | $ | 88,802          
|                                     |   |                    |   |                 



"Other" expenses include public company cost, telephone, office, insurance and other general and administrative expenses.  The decrease in operating expenses for the period is attributable to the Company's limited business activity during the period.

Liquidity and Capital Resources



Cash Flows From Operations.  Cash used in operations for the six months ended December 31, 2006 and 2005 were
$59,241 and $194,596 respectively.



Cash Flows From Investing Activities.  During the six months ended December 30, 2006 and 2005, we engaged in no investing activities.



Cash Flows from Financing Activities.During the six months ended December 31, 2006,
$50,000 was provided by financing activities.  During the six months ended December 31, 2005 we received cash of $150,000 proceeds from the issuance of short-term debt.

Going Concern

The Company incurred net losses of $500,941, $717,477 and $20,355 for the years ended June 30, 2006, 2005 and 2004, respectively.  The Company incurred a net loss of $170,399 for the six months ended December 31, 2006.  In addition, at December 31, 2006, the Company had negative working capital of  
$95,334 and negative stockholders equity of $39,804.  These conditions raise substantial doubt about the Company's ability to continue as a going concern.



We are actively seeking a merger candidate, an acquisition of a viable business or a buyer of the corporate entity.



The financial statements do not include any adjustment to reflect the possible effects on the recoverability and classification of assets or liabilities which may result from the inability of the Company to continue as a going concern.



ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk from changes in interest rates which may adversely affect our financial position, results of operations and cash flows.  In seeking to minimize the risks from interest rate fluctuations, we manage exposures through our regular operating and financing activities.  We do not use financial instruments for trading or other speculative purposes and we are not a party to any leveraged financial instruments.  We are exposed to interest rate risk primarily through our borrowing activities, which are described in the "Notes Payable" Note to the Consolidated Financial Statements of our Annual Report on Form 10-K for fiscal year ended June 30, 2006, which is incorporated herein by reference.



ITEM 4.	CONTROLS AND PROCEDURES



Evaluation of Disclosure Controls and Procedures.  Our Chief Executive Officer has reviewed and evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 240.13a-15(e) or 15d-15(e)) as of the end of the period covered by this report.  Based on that evaluation, the Chief Executive Officer has concluded that our current disclosure controls and procedures provide him with reasonable assurance that they are effective to provide him with timely material information relating to us required to be disclosed in the reports we file or submit under the Exchange Act.



Annual report on internal control over financial reporting.  Based upon the most recent pronouncements of the Securities and Exchange Commission, our first annual report on internal control over financial reporting is due for inclusion in our annual report on Form 10-K for the twelve month period ending June 30, 2008.  We expect to begin the process during next fiscal year of identifying a framework to use to evaluate the effectiveness of our internal control over financial reporting as (as defined in Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act of 1934.)



Changes in Internal Control over Financial Reporting.Our management has evaluated whether any change in our internal control over financial reporting occurred during the last fiscal quarter.  Based on that evaluation, management concluded that there has been no change in our internal control over financial reporting during the relevant period that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



PART II - OTHER INFORMATION





ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS



On January 18, 2007, the holder of 20 shares of the Company's Series 2002-K Preferred Stock, representing all of the issued and outstanding shares of Series 2002-K Preferred Stock, converted its holdings into Common Stock.  The preferred stock had a liquidation value of $500,000 and was converted into 625,000 shares of Common Stock at a conversion price of $0.80 per share.



The foregoing issuances were made pursuant to the exemption from registration provided by Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, in that (a) the investor or its purchaser representative is reasonably believed to have such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the investment, (b) the investor or its purchaser representative were provided with required information and an opportunity to obtain additional information a reasonable period of time prior to the transaction, (c) the investor or its purchaser representative were advised of the limitations on resale of the Common Stock, (d) the investor represented its intention to acquire the securities for investment only and not with view to or for sale in connection with any distribution thereof, and (e) appropriate legends were affixed to the instruments issued in the transactions.





ITEM 5.	OTHER INFORMATION



On November 6, 2006, the terms of the loan agreement with Trident covering our outstanding convertible debt were modified to reduce the conversion price from the 3-day average closing price of our Common Stock ($2.75 per share as of November 6, 2006) to $0.25 per share.  The entire outstanding principal balance and accrued interest totaling $1,179,713 was then converted into 4,718,852 shares of Common Stock, in full satisfaction of the debt.  The general effect of such modification upon the rights of the holder of the securities is that the holder received 4,289,865 shares of Common Stock more than it would have received if it had converted the debt without the modification.  The benefit of the modification to the Company is that virtually all of our outstanding debt was eliminated.



The conversion of the convertible preferred stock and convertible debt into equity securities by Trident resulted in a change in control of the Company, in that Trident acquired beneficial ownership of approximately 97% of the voting securities of the Company.  Prior to the transaction, control rested with approximately 15,000 of our public shareholders, including one shareholder who held beneficial ownership of approximately 30% and another shareholder who held beneficial ownership of approximately 5% of our voting securities.  There are no arrangements or understandings among members of both the former and new control groups and their associates with respect to election of directors or other matters.  To our knowledge, there are currently no arrangements in effect that may at a subsequent date result in a change in control of the Company.



On January 18, 2007, the holder of 20 shares of the Company's Series 2002-K Preferred Stock, representing all of the issued and outstanding shares of Series 2002-K Preferred Stock, converted its holdings into Common Stock.  The preferred stock had a liquidation value of $500,000 and was converted into 625,000 shares of Common Stock at a conversion price of $0.80 per share.



The foregoing issuances were made pursuant to the exemption from registration provided by Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, in that (a) the investor or its purchaser representative is reasonably believed to have such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the investment, (b) the investor or its purchaser representative were provided with required information and an opportunity to obtain additional information a reasonable period of time prior to the transaction, (c) the investor or its purchaser representative were advised of the limitations on resale of the Common Stock, (d) the investor represented its intention to acquire the securities for investment only and not with view to or for sale in connection with any distribution thereof, and (e) appropriate legends were affixed to the instruments issued in the transactions.





ITEM 6.	EXHIBITS



Reference is made to the Exhibit Index of this Form 10-Q for a list of all exhibits filed with and incorporated by reference in this report.





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.



| | VPGI Corp.  
| | ------------
| | (Registrant)
| |             
| | By:         
| |             
| |             
| |             



Date:	February 14, 2007





VPGI CORP.



EXHIBIT INDEX



Exhibit Number      Description of Exhibits



|31 * | Certification of Chief Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|32 * | Certification of Chief Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                

_______________

*  Filed herewith.