**UNITED        STATES SECURITIES AND EXCHANGE COMMISSION**

**Washington,        D.C. 20549**

**FORM        10-K**

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

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

| **Chesapeake                  Corporation**                                                        |
|----------------------------------------------------------------------------------------------------|
| (Exact                  name of registrant as specified in its charter)                            |
|                                                                                               |   |
| **Virginia**                                                                                       | **54-0166880** |
| (State                  or other jurisdiction of incorporation or organization)                    | (I.R.S.                  Employer Identification No.) |
|                                                                                               |   |
| **1021                  East Cary Street, Richmond, Virginia**                                     | **23219** |
| (Address                  of principal executive offices)                                          | (Zip                  Code) |
|                                                                                               |   |
| Registrant’s                  telephone number, including area code: **804-697-1000**        |
| Securities                  registered pursuant to Section 12(b) of the Act:                       |
| Title                  of each class                                                               | Name                  of each exchange on which registered |
| Common                  Stock, par value $1                                                        | New                  York Stock Exchange |
| Preferred                  Stock Purchase Rights                                                   | New                  York Stock Exchange |
| Securities                  registered pursuant to Section 12(g) of the Act:                  None |

**Indicate        by check mark if the registrant is a well-known seasoned issuer, as defined        in        Rule 405 of the Securities Act. Yes [ ] No [√ ]**

**Indicate        by check mark if the registrant is not required to file reports pursuant        to        Section 13 of Section 15(d) of the Act. Yes [ ] No [√ ]**

**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 [ √ ] No [ ]**

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

**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 (check        one): Large accelerated filer [ ] Accelerated filer [ √ ] Non-accelerated filer        [ ]**

**Indicate        by check mark whether the registrant is a shell company (as defined in Rule        12b-2 of the Act). Yes [ ] No [ √ ]**

**The        aggregate market value on July 2, 2006 (the last day of the registrant’s most        recently completed second quarter), of the voting and non-voting common equity        held by non-affiliates of the registrant was approximately $315 million.        In        determining this figure, the registrant has assumed that all of its directors        and officers are affiliates. This assumption shall not be deemed conclusive        for        any other purpose.**

**19,895,056        shares of the registrant’s common stock, par value $1, were outstanding as of        February 28, 2007.**

**Portions        of the registrant’s definitive Proxy Statement for the annual meeting of        stockholders to be held on April 25, 2007, are incorporated in Part III by        reference.**

**The        index of exhibits can be found on pages 86-88.**

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**TABLE        OF CONTENTS**
** **

**Page        No.**

| **PART                I** |  **1** |
|---------------------------|-------------|

| Item                1. | Business |  2 |
|------------------------|----------|---------|
| Item                  1A. | Risk                  Factors | 16 |
|---------------------------|-------------------------------|----|

| Item                  1B. | Unresolved                  Staff Comments | 22 |
|---------------------------|--------------------------------------------|----|

| Item                  2. | Properties | 23 |
|--------------------------|------------|----|

| Item                  3. | Legal                  Proceedings | 23 |
|--------------------------|------------------------------------|----|

| Item                  4. | Submission                  of Matters to a Vote of Security Holders | 23 |
|--------------------------|----------------------------------------------------------------------|----|

| Item                  X. | Executive                  Officers of the Registrant | 24 |
|--------------------------|-------------------------------------------------------|----|

| **PART II** |  **24** |
|-------------|--------------|

| Item                  5. | Market                  for Registrant’s Common Equity, Related Stockholder Matters and Issuer                  Purchases of Equity Securities | 24 |
|--------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|----|

| Item                  6. | Selected                  Financial Data | 26 |
|--------------------------|------------------------------------------|----|

| Item                  7. | Management’s                  Discussion and Analysis of Financial Condition and Results of                  Operations | 27 |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------|----|

| Item                  7A. | Quantitative                  and Qualitative Disclosures about Market Risk | 42 |
|---------------------------|-----------------------------------------------------------------------------|----|

| Item                  8. | Financial                  Statements and Supplementary Data | 43 |
|--------------------------|--------------------------------------------------------------|----|

| Item                  9. | Changes                  in and Disagreements With Accountants on Accounting and Financial                  Disclosure | 80 |
|--------------------------|------------------------------------------------------------------------------------------------------------------------|----|

| Item                  9A. | Controls                  and Procedures | 81 |
|---------------------------|------------------------------------------|----|
| Item 9B. | Other                Information |  82 |
|----------|----------------------------------|----------|

| **PART III** |   |  **83** |
|--------------|--------|--------------|

| Item                  10. | Directors,                  Executive Officers and Corporate Governance | 83 |
|---------------------------|-------------------------------------------------------------------------|----|

| Item                  11. | Executive                  Compensation | 83 |
|---------------------------|-----------------------------------------|----|

| Item                  12. | Security                  Ownership of Certain Beneficial Owners and Management and Related                  Stockholder Matters | 83 |
|---------------------------|----------------------------------------------------------------------------------------------------------------------------------|----|

| Item                  13. | Certain                  Relationships and Related Transactions, and Director                  Independence | 83 |
|---------------------------|-------------------------------------------------------------------------------------------------------------|----|

| Item                  14. | Principal                  Accountant Fees and Services | 83 |
|---------------------------|---------------------------------------------------------|----|

| **PART IV** |   | **84** |
|-------------|--------|--------|
|   |   |   |
|--------|--------|--------|
| Item                15. | Exhibits                and Financial Statement Schedules |  84 |
|-------------------------|-----------------------------------------------------------|----------|

|                  **SIGNATURES** |   **85** |
|--------------------------------------|--------------------|
|                                 |               |
| **EXHIBIT                  INDEX**   |  **86**       |

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**PART        I**
** **

**Forward-Looking        Statements**

| ·   | future                results of operations; |
|--------------------|----------------------------------------------|
| ·   | liquidity,                cash flow and capital expenditures; |
|--------------------|---------------------------------------------------------------|
| ·   | acquisition                activities and the effect of completed acquisitions, including expected                synergies and cost savings; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | projected                costs and savings associated with restructuring and other cost saving                programs; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------|
| ·   | pending                or anticipated litigation; |
|--------------------|---------------------------------------------------|
| ·   | debt                levels and the ability to obtain additional financing or make payments                on                our debt; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|
| ·   | regulatory                developments, industry conditions and market conditions;                and |
|--------------------|-------------------------------------------------------------------------------------------------------|
| ·   | general                economic conditions. |
|--------------------|---------------------------------------------|

**Industry        and Market Data**

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| **Item              1.  ** | **Business** |
|--------------------------------------|--------------|

**Business        **
**History        and Overview**

| ·   | *Paperboard                Packaging*.                Our Paperboard Packaging segment designs and manufactures folding                cartons,                spirally wound composite tubes, leaflets, labels and other paper                and                paperboard packaging products. Our primary end-use markets are                pharmaceutical and healthcare; branded products (such as alcoholic                drinks,                confectioneries and foods); and tobacco products. We are one of the                leading European suppliers of paperboard packaging products within                several                of our end-use markets, including pharmaceutical and healthcare,                alcoholic                drinks and confectioneries. For the fiscal year ended December 31,                2006,                our Paperboard Packaging segment produced revenues and operating                income                (as defined in Item 7 “Management’s Discussion and Analysis of Financial                Condition and Results of Operations - Review of Consolidated Results                of                Operations”) of $840.4 million and $42.9 million, respectively, and                accounted for 84% of our net sales. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Plastic                Packaging*.                Our Plastic Packaging segment designs and manufactures plastic containers,                bottles, preforms and closures. Our primary end-use markets are                agrochemicals, other specialty chemicals, and food and beverages.                We                believe that our Plastic Packaging segment holds leadership positions                within several sectors of our end-use markets, including HDPE fluorinated                barrier containers for agrochemicals and other specialty chemicals                markets, primarily in Europe and China, HDPE bottles for the Irish                dairy                market and PET bottles and preforms for soft drink markets in South                Africa. For the fiscal year ended December 31, 2006, our Plastic                Packaging                segment produced revenues and operating income (as defined in Item                7                “Management’s Discussion and Analysis of Financial Condition and Results                of Operations - Review of Consolidated Results of Operations”) of $155.0                million and $17.9 million, respectively, and accounted for 16% of                our net                sales. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | creative                packaging designs to position their brands with consumers and                differentiate those brands on the retail                shelf; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | technical                expertise and production capabilities to address their special packaging                requirements and desire for innovative packaging                solutions; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | a                broad range of printing processes and a one-stop-shop approach to                their                specialty packaging needs; and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | broad                geographic coverage and effective supply chain                offerings. |
|--------------------|-----------------------------------------------------------------------------------------------|

**Business        Strategy**

***Chesapeake’s        $25-Million Cost Savings Program***

| ·   | increasing                our focus on business operations that are aligned with our global                strategic vision and that possess what we believe are the driving                forces                that will enable us to achieve improved performance in the                market; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | improving                our operational processes; and |
|--------------------|---------------------------------------------------------|
| ·   | reducing                our overall company-wide cost structure. |
|--------------------|------------------------------------------------------------------|

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***Organic        Growth***

| ·   | *Markets                that offer higher growth potential*—*pharmaceutical                and healthcare*.                We believe that global demand for pharmaceutical and healthcare products                packaging will grow significantly over the next decade as a result                of                global population growth, an aging population in industrialized countries,                new drug technology and new regulatory requirements. As a leading                supplier                of pharmaceutical and healthcare paperboard packaging in Europe,                and as a                supplier of plastic packaging for pharmaceutical and healthcare products,                we expect to benefit from this market growth. We also intend to increase                our share of this market by looking for opportunities to expand our                offerings beyond an already comprehensive range of paperboard packaging,                leaflets and labels. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Markets                where brand positioning and differentiation are important—branded                products; over-the-counter pharmaceutical and healthcare*.                Brand leaders in these markets value our ability to provide sophisticated                creative and structural designs, intricate graphic and embossed details,                and value-added service enhancements. These process capabilities                have led                several international manufacturers of branded products to designate                us as                their primary paperboard packaging supplier. Many manufacturers of                branded                products also rely on us to create and supply the packaging for their                product range extensions or geographic market expansions, which we                believe                will continue to generate additional growth opportunities for                us. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Markets                that have special packaging requirements—pharmaceutical and healthcare;                agrochemicals and other specialty chemicals*.                We are a market leader in several of our target end-use markets that                have                special packaging requirements. In our Paperboard Packaging segment,                our                pharmaceutical packaging plants comply with the Pharmaceutical Supplier                Code of Practice, and individual plants are accredited by their respective                pharmaceutical customers, reflecting our ability to consistently                satisfy                the stringent quality standards of our customers. As a result of                our                ability to provide innovative packaging solutions (such as special                features designed to prevent counterfeiting of prescription drugs                and                custom dose “patient packs”), together with leaflets and labels, often in                multiple languages, we are one of the largest suppliers of                paper-based                pharmaceutical and healthcare packaging in Europe. In our Plastic                Packaging segment, our proprietary process for blow molding of fluorinated                HDPE barrier containers has helped us to achieve a significant position                in                the European market for such containers. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | *Geographic                markets that offer the opportunity to leverage a product or market                niche.*As                an example, the developing nature of the South African market offers                the                opportunity to be a leader by introducing technology and products                that are                commonplace in more developed markets. By being a leading presence,                we can                take advantage of the growth we believe this market                provides. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Non-organic        Growth***

*—        *

**Competitive        Strengths**

| ·   | *Sophisticated                design and manufacturing capabilities*.                Our sophisticated structural and creative package design skills,                and our                experience in printing and manufacturing complex package designs,                are                important competitive strengths. For example, our pharmaceutical                and                healthcare customers rely on our ability to provide both regulatory                and                marketing information in attractive and functional paperboard packaging,                while meeting stringent standards for quality and text integrity.                To                support the multifaceted needs of these customers, we have a packaging                design center dedicated solely to the pharmaceutical and healthcare                industries. Similarly, we are a leading European designer and supplier                of                creative paperboard packaging that supports the brand images of                internationally recognized branded products. For these customers,                our                design skills and ability to print and manufacture packaging that                incorporates design and construction features with intricate graphic                and                embossed detailing are important to successfully marketing their                products.                In our Plastic Packaging segment, our technical expertise and experience                relating to in-line fluorinated blow-molding of HDPE barrier containers                is                an important competitive strength. Additionally, we have recently                installed capacity to produce multilayer PET barrier preforms in                South                Africa. New and existing customers are looking for solutions like                multilayer PET barrier bottles that will extend the shelf life of                fruit                juice and various carbonated beverages in Africa where temperatures                are                elevated and refrigeration is not widespread. Taking advantage of                this                niche opportunity by bringing this leading-edge technology to developing                markets provides us with a competitive advantage.* * |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Understanding                of how our products and services impact our customers’ supply                chains.*                In                our pharmaceutical and healthcare and branded products paperboard                packaging markets, we have developed a sophisticated, web-based,                system                solution to enable our customers to manage and optimize their packaging                supply chain. This system takes customer demand information and converts                it into amalgamated raw material requirements. These requirements                can then                be cross-checked against strategically placed inventories, increasing                the                speed of paperboard sourcing and reducing lead times at our factories.                The                system also interfaces with the paperboard making cycle data from                our own                approved suppliers. This type of capability positions us with our                customers as more than simply a manufacturer of paperboard                packaging. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | *Strong                customer relationships*.                We have long standing customer relationships with many of the world’s                largest branded products, tobacco and pharmaceutical and healthcare                products companies. Our major customers include operating units of                3M                Company; Diageo plc; Gallaher Group plc; GlaxoSmithKline plc; Nestlé S.A.;                Pernod Ricard S.A.; Schering-Plough Corporation; Storck KG; and Syngenta                AG. The average length of our relationships with our top ten customers                exceeds 30 years. These long-term relationships, together with our                global                manufacturing footprint, enhance our competitive                position. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Broad                geographic manufacturing network including pan-European                service*.                We supply specialty paperboard and plastic packaging products throughout                the world from a strategically located network of 39 paperboard packaging                facilities in Europe, North America and Asia, and seven plastic packaging                facilities in Europe, Africa and Asia. Our facilities are generally                located in close proximity to our largest customers. Our strategic                manufacturing footprint meets our customers’ needs for reduced delivery                times and flexibility in both order size and                geography. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Paperboard        Packaging**

***Industry        Overview***

----

***Operations***

***Products        and Markets***

| ·   | pharmaceutical                and healthcare; |
|--------------------|-----------------------------------------------|
| ·   | branded                products, such as alcoholic drinks, confectioneries and foods; and |
|--------------------|-------------------------------------------------------------------------------------------|
| ·   | tobacco                products. |
|--------------------|----------------------------------|

*Pharmaceutical        and Healthcare*

----

*Branded        Products*

| ·   | *Alcoholic                Drinks*—We                are the leading supplier of paperboard packaging to alcoholic drink                manufacturers in Europe. Our packaging products for the drinks sector                include folding cartons, spirally wound composite tubes, and self-adhesive                or wet applied labels, and are generally complex, higher-value-added                products involving special finishes such as gold blocking and embossing.                Our competitive strengths in this market include our experience in                designing and manufacturing high graphic content packaging with a                broad                range of finishes and effects, and our one-stop shop approach to                supplying                labels to complement the principal packaging application. Our principal                alcoholic drink customers include operating units of Diageo plc,                William                Grant & Sons Inc. and Pernod Ricard SA. Products for which we                manufacture and design packaging include international brands such                as                Johnnie Walker™, J&B®, Chivas Regal®, Ballentine’s®, Glenfiddich®,                Beefeater® Gin and Baileys®. These products are distributed by our                customers to global retail markets. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | *Confectioneries*—We                are the leading supplier of paperboard packaging to the European                confectioneries industry. A key feature of this market is the demand                for                innovative packaging designs for year-end holiday and Easter products.                Our                competitive strengths in this market include internationally recognized                creative and structural design resources and process controls designed                to                prevent taint and odor problems that could affect confectionery products.                Our principal confectioneries customers include operating units of                Nestlé                S.A.; Storck KG; Mars, Incorporated; Cadbury Schweppes plc; and Kraft                Foods Inc., for their brands which include After Eight®, Mars®                Celebrations® and Cadbury’s® Milk Tray®. These products are distributed by                our customers primarily to European retail markets and, more recently,                in                the United States. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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*Tobacco        Products*

***Product        Design, Manufacturing and Distribution***

*Plate        making*

*Die        making*

*Printing*

----

*Cutting        and creasing*

*Gluing        and packing*

***Sales        and Marketing***

----

***Raw        Materials***

**Plastic        Packaging**

***Industry        Overview***

***Products        and Markets***

----

| ·   | agrochemicals                and other specialty chemicals; and |
|--------------------|-----------------------------------------------------------------|
| ·   | food                and beverages. |
|--------------------|------------------------------------|

*Agrochemicals        and Other Specialty Chemicals*

*Food        and Beverages*

***Product        Design, Manufacturing and Distribution***

----

***Sales        and Marketing***

***Raw        Materials***

----

**Competition**

**Customers**

**Employees**

**Seasonality**

----

**Research        and Development**

**Trademarks        and Intellectual Property**

**Compliance        with Environmental Regulations**

**Availability        of Reports, Certain Committee Charters and Other        Information**

**Item        1A.**
**Risk        Factors**

----

***Risks        Related to Our Substantial Indebtedness and Our Common        Stock***

*Our        substantial indebtedness could adversely affect our cash flow and our ability        to        fulfill our obligations under our indebtedness. *

|   | • | make                  it more difficult for us to generate sufficient cash to satisfy                  our                  obligations with respect to our indebtedness; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | require                  us to dedicate a substantial portion of our cash flow from operations                  to                  payments on our indebtedness, reducing the amount of our cash flow                  available for other purposes, including capital expenditures, acquisitions                  and other general corporate purposes; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | require                  us to sell debt or equity securities or to sell some of our core                  assets,                  possibly on less than favorable terms, to meet debt payment obligations; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | expose                  us to risks that are inherent in interest rate fluctuations because                  a part                  of our indebtedness bears variable rates of interest. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

*Restrictive        covenants in our senior credit facility and our other indebtedness could        adversely affect our business by limiting our operating and strategic        flexibility. *

----

*We        are a holding company and are dependent upon interest income and loans from        our        subsidiaries to meet our debt service obligations and pay dividends on our        common stock. *

***Risks        Related to Our Business***

*Our        business and financial performance may be harmed by future increases in raw        material costs. *

*Competition        in specialty packaging markets could harm our financial condition and results        of        operations. *

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*Our        business and financial performance may be adversely affected by the relocation        of our customers’ plants and manufacturing capacity. *

*Our        business and financial performance may be adversely affected by our inability        to        effectively implement initiatives under our $25-million cost savings        program.*

|   | • | initiatives                  we are contemplating may require consultation with various works                  councils,                  employee representatives or regulators, and such consultations                  may                  influence the timing, costs and extent of expected                  savings; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | initiatives                  will also require close coordination with customers with respect                  to the                  transfer of existing business to other company locations, and certain                  business may not ultimately be retained as a result of possible                  closures                  or consolidations of facilities; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | projected                  savings, including proceeds from sales of related real estate and                  other                  assets, contemplated under this program may fall short of estimated                  targets. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*Our        business may suffer from risks related to potential future acquisitions.        *

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|   | • | The                  integration process could disrupt the activities of the businesses                  that                  are being combined. The combination of the businesses or plants                  may                  require, among other things, coordination of administrative and                  other                  functions and consolidation of production capacity. Plant consolidation                  may strain our ability to deliver products of acceptable quality                  in a                  timely manner from consolidated facilities. We may experience attrition                  among the skilled labor force at the companies acquired in reaction                  to                  being acquired and in reaction to our consolidation of plants. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | The                  execution of our integration plans may divert the attention of                  our                  management from operating our business. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Future                  acquisitions could cause a reduction of our reported earnings per                  share                  because of the issuance of additional securities or debt, increased                  interest costs, goodwill write-offs and increased income tax rates. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*If        we        fail to maintain satisfactory relationships with our larger packaging customers,        our business may be harmed. *

*Our        business and financial performance may be adversely affected by downturns        in the        target markets that we serve. *

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*We        may be adversely affected by seasonal sales cycles. *

*We        conduct the majority of our operations in non-U.S. countries, and our operating        results are highly dependent on our non-U.S. sales and operations, which        exposes        us to various risks. *

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*We        are subject to many environmental laws and regulations that require significant        expenditures for compliance and remediation efforts, and changes in the law        could increase those expenses and adversely affect our operations.*

*We        depend on certain key personnel, and the loss of any key personnel may seriously        harm our business. *

*Future        government regulations and judicial decisions affecting the packaging we        produce        or the products shipped in the packaging we produce could significantly reduce        demand for our packaging products. *

*Anti-takeover        provisions under Virginia law and in our articles of incorporation and our        bylaws may negatively affect the price of our common stock.*

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| •   | divide                our board of directors into three classes of directors serving staggered                three-year terms; |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------|
| •   | provide                that directors may be removed only by the affirmative vote of the                holders                of at least 80% of the outstanding shares of our common stock (which                required vote may only be changed by the affirmative vote of a majority                of                our continuing directors and the holders of two-thirds of our outstanding                common stock); |
|---------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •   | require                the affirmative vote of holders of at least 80% of our outstanding                shares                of common stock to approve certain business combinations;                and |
|---------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •   | require                approval of material acquisition transactions (such as mergers, share                exchanges, and material dispositions of corporate assets not in the                ordinary course of business) between our company and any holder of                more                than 10 percent of any class of our outstanding voting shares by                the                holders of at least two-thirds of the remaining voting shares of                our                company. |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*The        ultimate resolution of the Internal Revenue Service’s proposed adjustments        relating to our tax treatment of our disposition of assets of Wisconsin Tissue        Mills Inc. could have a material adverse effect on our financial condition        or        results of operations.*

**Item        1B.        Unresolved Staff Comments**

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| **Item              2.  ** | **Properties** |
|--------------------------------------|----------------|

**Paperboard        Packaging**

**Belgium**

**England**

**France**

**Germany**

**Netherlands**

**Northern        Ireland**

**People’s        Republic of China**

**Republic        of Ireland**

**Scotland**

**Spain**

**United        States**

**Wales**

**Plastic        Packaging**

**England**

**France**

**Mauritius**

**People’s        Republic of China**

**Republic        of Ireland**

**South        Africa**

**Corporate        Headquarters**

**England:        **

**United        States**

| **Item              3.  ** | **Legal                Proceedings** |
|--------------------------------------|--------------------------------------|
| **Item              4.  ** | **Submission                of Matters to a Vote of Security                Holders** |
|--------------------------------------|---------------------------------------------------------------------------------------|

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**Item        X.**
**Executive        Officers of the Registrant**

**PART        II**

| **Item              5.  ** | **Market                for Registrant’s Common Equity, Related Stockholder                Matters****and Issuer Purchases of Equity                Securities** |
|--------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                |   | **Market                  Price** |      |          |   |
|-------------------------------------|--------|-----------------------------------|-----------|---------------|--------|
|                                |   |  **High**                    |      |  **Low** |   | **Dividends****Declared** |   |
| **2006**                            |   |                              |      |          |   |   |   |
| **First                  quarter**  |   | **$**                             | **17.27** |          | **$**  | **13.08** |   | **$** | **0.22** |   |
| **Second                  quarter** |   |                              | **16.48** |          |   | **13.13** |   |   | **0.22** |   |
| **Third                  quarter**  |   |                              | **16.78** |          |   | **12.94** |   |   | — |   |
| **Fourth                  quarter** |   |                              | **17.50** |          |   | **13.72** |   |   | **0.44** |   |
| 2005                                |   |                              |      |          |   |   |   |   |   |   |
| First                  quarter      |   | $                                 | 27.40     |          | $      | 20.07 |   | $ | 0.22 |   |
| Second                  quarter     |   |                              | 22.30     |          |   | 18.81 |   |   | 0.22 |   |
| Third                  quarter      |   |                              | 22.88     |          |   | 17.69 |   |   | 0.22 |   |
| Fourth                  quarter     |   |                              | 21.06     |          |   | 16.13 |   |   | 0.22 |   |

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**Equity        Compensation Plan Information**

|                                                                        |   Number                  of securities to be issued upon exercise of outstanding options,                  warrants                  and rights |   |   Weighted-average                  exercise price of outstanding options, warrants and rights |   |   Number                  of securities remaining available for future issuance under equity                  compensation plans (excluding securities reflected in column                  (a)) |
|-----------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Plan                  category                                              | (a)                                                                                                                                                        |   | (b)                                                                                                      |   | (c)                                                                                                                                                                                                        |
| Equity                  compensation plans approved by security holders     | 1,399,573                                                                                                                                                  |   | $26.93                                                                                                   |   | 5,021,123                                                                                                                                                                                                  |
| Equity                  compensation plans not approved by security holders | —                                                                                                                                                    |   | —                                                                                                  |   | —                                                                                                                                                                                                    |
| Total                                                                       | 1,399,573                                                                                                                                                  |   | $26.93                                                                                                   |   | 5,021,123                                                                                                                                                                                                  |

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| **Item              6.  ** | **Selected                Financial Data** |
|--------------------------------------|--------------------------------------------|

**Five-Year        Comparative Record**

| (*dollar                  amounts in millions, except per share data*) |   | **2006****(1)** |        | **2005****(2)** |   | **2004****(3)** |   | **2003****(4)** |    | **2002****(5)** |   |
|------------------------------------------------------------------------|--------|-----------------|-------------|-----------------|--------|-----------------|--------|-----------------|---------|-----------------|--------|
| Operating                  Results                                     |   |            |        |            |   |            |   |            |    |            |   |
| Net                  sales                                             |   | **$**           | **995.4**   |            | $      | 1,009.2         |   | $               | 997.9   |            | $      | 850.4 |   | $ | 755.6 |   |
| (Loss)                  income from continuing operations              |   |            | **(32.4**   | **)**           |   | (306.7          | )      |            | 16.2    |            |   | 24.1 |   |   | 13.9 |   |
| Discontinued                  operations                               |   |            | **(7.2**    | **)**           |   | (7.6            | )      |            | (4.5    | )               |   | 2.8 |   |   | 8.0 |   |
| Net                  (loss) income                                     |   |            | **(39.6**   | **)**           |   | (314.3          | )      |            | 11.7    |            |   | 26.9 |   |   | 21.9 |   |
| Cash                  dividends declared on common stock               |   |            | **17.3**    |            |   | 17.1            |   |            | 17.0    |            |   | 13.4 |   |   | 13.3 |   |
| Net                  cash provided by operating activities             |   |            | **21.7**    |            |   | 44.6            |   |            | 93.1    |            |   | 80.0 |   |   | 51.1 |   |
| Common                  Stock                                          |   |            |        |            |   |            |   |            |    |            |   |   |   |   |   |   |
| Number                  of stockholders of record at year-end          |   |            | **4,304**   |            |   | 4,422           |   |            | 4,553   |            |   | 4,744 |   |   | 4,913 |   |
| Shares                  outstanding at year-end (in millions)          |   |            | **19.8**    |            |   | 19.6            |   |            | 19.6    |            |   | 15.3 |   |   | 15.2 |   |
| Per                  share                                             |   |            |        |            |   |            |   |            |    |            |   |   |   |   |   |   |
| Basic                  earnings from continuing operations             |   | **$**           | **(1.67**   | **)**           | $      | (15.81          | )      | $               | 0.88    |            | $      | 1.59 |   | $ | 0.92 |   |
| Basic                  earnings                                        |   |            | **(2.04**   | **)**           |   | (16.20          | )      |            | 0.63    |            |   | 1.77 |   |   | 1.45 |   |
| Diluted                  earnings from continuing operations           |   |            | **(1.67**   | **)**           |   | (15.81          | )      |            | 0.88    |            |   | 1.59 |   |   | 0.91 |   |
| Diluted                  earnings                                      |   |            | **(2.04**   | **)**           |   | (16.20          | )      |            | 0.63    |            |   | 1.77 |   |   | 1.44 |   |
| Dividends                  declared                                    |   |            | **0.88**    |            |   | 0.88            |   |            | 0.88    |            |   | 0.88 |   |   | 0.88 |   |
| Year-end                  stockholders’ equity                   |   |            | **11.80**   |            |   | 15.07           |   |            | 36.34   |            |   | 37.26 |   |   | 31.36 |   |
| Financial                  Position at Year-end                        |   |            |        |            |   |            |   |            |    |            |   |   |   |   |   |   |
| Working                  capital                                       |   | **$**           | **31.9**    |            | $      | 8.8             |   | $               | 21.3    |            | $      | 62.9 |   | $ | 83.0 |   |
| Property,                  plant and equipment, net                    |   |            | **354.1**   |            |   | 372.0           |   |            | 427.2   |            |   | 431.6 |   |   | 376.4 |   |
| Total                  assets                                          |   |            | **1,114.8** |            |   | 1,123.0         |   |            | 1,557.0 |            |   | 1,492.8 |   |   | 1,352.9 |   |
| Debt                                                                   |   |            | **467.8**   |            |   | 432.9           |   |            | 428.9   |            |   | 486.9 |   |   | 491.4 |   |
| Stockholders’                  equity                            |   |            | **233.7**   |            |   | 295.3           |   |            | 712.2   |            |   | 570.1 |   |   | 476.6 |   |
| Total                  capital                                         |   |            | **701.5**   |            |   | 728.2           |   |            | 1,141.1 |            |   | 1,057.0 |   |   | 968.0 |   |
| Percent                  of debt                                       |   |            |        |            |   |            |   |            |    |            |   |   |   |   |   |   |
| To                  total capital                                      |   |            | **66.7**    | **%**           |   | 59.4            | %      |            | 37.6    | %               |   | 46.1 | % |   | 50.8 | % |
| To                  stockholders’ equity                         |   |            | **200.2**   |            |   | 146.6           |   |            | 60.2    |            |   | 85.4 |   |   | 103.1 |   |
| Additional                  Data                                       |   |            |        |            |   |            |   |            |    |            |   |   |   |   |   |   |
| Number                  of employees at year-end                       |   |            | **5,553**   |            |   | 6,129           |   |            | 5,988   |            |   | 5,875 |   |   | 5,835 |   |

**Notes        to Five-Year Comparative Record**

----

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

**Overview        of Business**

***Paperboard        Packaging***

***Plastic        Packaging***

**Summary        of 2006**

**Review        of Consolidated **
**Results        of Operations**

----

***200***
**6*vs. 2005***

**Net        sales**

**Gross        margin**

**Selling,        general and administrative (“SG&A”) expenses**

**Goodwill        impairment charge: **

**Restructuring        expenses, asset impairments and other exit costs: **

----

**Gains/Losses        on divestitures**

**Other        income, net**

**Operating        income (loss)**

**Interest        expense, net**

**Loss        on extinguishment of debt**

**Tax        expense**

**Loss        from continuing operations**

***2005        vs. 2004***

**Net        sales**

----

**Gross        margin**

**Selling,        general and administrative (“SG&A”) expenses**

**Goodwill        impairment charge: **
** **

**Restructuring        expenses, asset impairments, and other exit costs: **

**Losses        on divestitures**

**Other        income, net**

**Operating        income (loss)**

**Interest        expense, net**

**Loss        on extinguishment of debt**

**Tax        expense**

----

**Income        (loss) from continuing operations**

**Review        of Segment Results**

***Paperboard        Packaging***

| ***(dollars                  in millions)*** |   | **2006** |   | **2005** |   | **2004** |   |
|----------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                         |   |     |   |     |   |     |   |
| Net                  sales                   |   | $        | 840.4  |     | $      | 827.4    |   | $ | 830.9 |   |
| Operating                  income            |   |     | 42.9   |     |   | 49.8     |   |   | 52.7 |   |
| Operating                  income margin %   |   |     | 5.1    | %        |   | 6.0      | %      |   | 6.3 | % |

**2006        vs. 2005**

**2005        vs. 2004**

***Plastic        Packaging***

| ***(dollars                  in millions)*** |   | **2006** |   | **2005** |   | **2004** |   |
|----------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                         |   |     |   |     |   |     |   |
| Net                  sales                   |   | $        | 155.0  |     | $      | 181.8    |   | $ | 167.0 |   |
| Operating                  income            |   |     | 17.9   |     |   | 15.0     |   |   | 21.5 |   |
| Operating                  income margin %   |   |     | 11.5   | %        |   | 8.3      | %      |   | 12.9 | % |

**2006        vs. 2005**

----

**2005        vs. 2004**

**Chesapeake’s        $25-Million Cost Savings Program**

| ·   | increasing                our focus on business operations that are aligned with our global                strategic vision and that possess what we believe are the driving                forces                that will enable us to achieve improved performance in the                market; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | improving                our operational processes; and |
|--------------------|---------------------------------------------------------|
| ·   | reducing                our overall company-wide cost structure. |
|--------------------|------------------------------------------------------------------|

**Discontinued        Operations**

----

|                                                                |   | **2006**   |   | **2005**                       |   | **2004**   |   |
|---------------------------------------------------------------------|--------|------------|--------|--------------------------------|--------|------------|--------|
| ***(in                  millions, except per share data)***         |   | **Amount** |   | **Per                  Share** |   | **Amount** |   | **Per                  Share** |   | **Amount** |   | **Per                  Share** |   |
|                                                                |   |       |   |                           |   |       |   |   |   |   |   |   |   |
| Discontinued                  operations:                           |   |       |   |                           |   |       |   |   |   |   |   |   |   |
| (Loss)                  income from discontinued operations         |   | $          | (4.4   | )                              | $      | (0.23      | )      | $ | (5.2 | ) | $ | (0.27 | ) | $ | (4.7 | ) | $ | (0.26 | ) |
| (Loss)                  gain on disposal of discontinued operations |   | $          | (2.8   | )                              | $      | (0.14      | )      | $ | (2.4 | ) | $ | (0.12 | ) | $ | 0.2 |   | $ | 0.01 |   |

**Seasonality**

**Liquidity        and Capital Resources**

----

***Contractual        Obligations***

|                                                |   | **Payments                  Due by Period****(1)** |   |
|-----------------------------------------------------|--------|----------------------------------------------------|--------|
| ***(in                  millions)***                |   | **Total**                                          |   | **Less                  Than 1 Year** |   | **1-3                  Years** |   | **3-5                  Years** |   | **After                  5 Years** |   |
|                                                |   |                                               |   |   |   |   |   |   |   |   |   |
| Long-term                  debt(2)                  |   | $                                                  | 464.2  |   | $ | 11.8 |   | $ | 133.6 |   | $ | 135.9 |   | $ | 182.9 |   |
| Interest(3)                                         |   |                                               | 182.8  |   |   | 26.7 |   |   | 52.5 |   |   | 52.2 |   |   | 51.4 |   |
| Operating                  leases                   |   |                                               | 20.7   |   |   | 5.8 |   |   | 8.5 |   |   | 3.3 |   |   | 3.1 |   |
| Other                  commitments(4)               |   |                                               | 12.1   |   |   | 10.5 |   |   | 1.2 |   |   | 0.4 |   |   | - |   |
| Total                  contractual cash obligations |   | $                                                  | 679.8  |   | $ | 54.8 |   | $ | 195.8 |   | $ | 191.8 |   | $ | 237.4 |   |

***Other        Commercial Commitments***

| ***(in                  millions)***            |   | **Total                  Amounts Committed** |   | **Less                  Than 1 Year** |   | **1-3                  Years** |   | **3-5                  Years** |    |
|-------------------------------------------------|--------|----------------------------------------------|--------|--------------------------------------------|--------|--------------------------------|--------|--------------------------------|---------|
|                                            |   |                                         |   |                                       |   |                           |   |                           |    |
| Committed                  lines of credit(1)   |   | $                                            | 250.0  |                                       | $      | —                        |   | $                              | 250.0   |   | $ | — |   |
| Uncommitted                  lines of credit(2) |   |                                         | 30.5   |                                       |   | 30.5                           |   |                           | — |   |   | — |   |
| Standby                  letters of credit(3)   |   |                                         | 2.5    |                                       |   | 2.5                            |   |                           | — |   |   | — |   |
| Total                  commercial commitments   |   | $                                            | 283.0  |                                       | $      | 33.0                           |   | $                              | 250.0   |   | $ | — |   |

***Financing***

----

----

***Guarantees        and Indemnifications***

----

***Cash        Flows***
** **

**Operating        activities**

**Investing        activities**

**Financing        activities**

***Capital        Structure***

----

**Risk        Management**

**Critical        Accounting Policies**

----

***Goodwill        and Other Long-Lived Asset Valuations***

*Goodwill        and Other Intangible Assets*

***Environmental        and Other Contingencies***

----

***Pension        and Other Postretirement Employee Benefits***

*“Employers’        Accounting for Defined Benefit Pension and Other Postretirement Plans - an        amendment of FASB Statements No. 87, 88, 106, and 132(R)”*

----

***Income        Taxes***

***Restructuring        and Other Exit Costs***

*Employers’        Accounting for Postemployment Benefits*
*Accounting        for the Costs Associated with Exit or Disposal Activities*

**New        Accounting Pronouncements**

*Accounting        for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109,        Accounting for Income Taxes*

----

*Fair        Value Measurements*

*Employers'        Accounting for Defined Benefit Pension and Other Postretirement Plans-an        amendment of FASB Statements No. 87, 88, 106, and 132(R) *

*Considering        the Effects of Prior Year Misstatements when Quantifying Misstatements in        Current Year Financial Statements*

**Forward-Looking        Statements**

| **Item              7A.  ** | **Quantitative                and Qualitative Disclosures about Market                Risk** |
|---------------------------------------|----------------------------------------------------------------------------------------------|

----

| **Item              8.  ** | **Financial                Statements and Supplementary                Data** |
|--------------------------------------|-------------------------------------------------------------------------------|

**INDEX**

----

**CHESAPEAKE        CORPORATION**

**Consolidated        Balance Sheets**

|                                                                                                                                           |   | **December                  31,****2006** |        | **January                  1,****2006** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|-------------|-----------------------------------------|--------|
| ***(in                  millions)***                                                                                                           |   |                                      |        |                                    |   |
| **Assets**                                                                                                                                     |   |                                      |        |                                    |   |
| Current                  assets:                                                                                                               |   |                                      |        |                                    |   |
| Cash                  and cash equivalents                                                                                                     |   | **$**                                     | **7.8**     |                                    | $      | 8.7 |   |
| Accounts                  receivable (less allowance of $3.9 and $3.8)                                                                         |   |                                      | **146.7**   |                                    |   | 134.8 |   |
| Inventories                                                                                                                                    |   |                                      | **109.4**   |                                    |   | 108.5 |   |
| Prepaid                  expenses and other current assets                                                                                     |   |                                      | **20.4**    |                                    |   | 26.1 |   |
| Income                  taxes receivable                                                                                                       |   |                                      | **2.6**     |                                    |   | 1.5 |   |
| Total                  current assets                                                                                                          |   |                                      | **286.9**   |                                    |   | 279.6 |   |
|                                                                                                                                           |   |                                      |        |                                    |   |   |   |
| Property,                  plant and equipment:                                                                                                |   |                                      |        |                                    |   |   |   |
| Plant                  sites and buildings                                                                                                     |   |                                      | **188.2**   |                                    |   | 179.4 |   |
| Machinery                  and equipment                                                                                                       |   |                                      | **402.5**   |                                    |   | 454.7 |   |
| Construction                  in progress                                                                                                      |   |                                      | **7.5**     |                                    |   | 6.7 |   |
|                                                                                                                                           |   |                                      | **598.2**   |                                    |   | 640.8 |   |
| Less                  accumulated depreciation                                                                                                 |   |                                      | **244.1**   |                                    |   | 268.8 |   |
| Net                  property, plant and equipment                                                                                             |   |                                      | **354.1**   |                                    |   | 372.0 |   |
| Goodwill                                                                                                                                       |   |                                      | **381.2**   |                                    |   | 354.0 |   |
| Other                  assets                                                                                                                  |   |                                      | **92.6**    |                                    |   | 117.4 |   |
| Total                  assets                                                                                                                  |   | **$**                                     | **1,114.8** |                                    | $      | 1,123.0 |   |
|                                                                                                                                           |   |                                      |        |                                    |   |   |   |
| **Liabilities                  and Stockholders’ Equity**                                                                                |   |                                      |        |                                    |   |   |   |
| Current                  liabilities:                                                                                                          |   |                                      |        |                                    |   |   |   |
| Accounts                  payable                                                                                                              |   | **$**                                     | **136.8**   |                                    | $      | 132.4 |   |
| Accrued                  expenses                                                                                                              |   |                                      | **83.9**    |                                    |   | 89.5 |   |
| Income                  taxes payable                                                                                                          |   |                                      | **18.1**    |                                    |   | 21.8 |   |
| Current                  portion of long-term debt                                                                                             |   |                                      | **11.8**    |                                    |   | 22.8 |   |
| Dividends                  payable                                                                                                             |   |                                      | **4.4**     |                                    |   | 4.3 |   |
| Total                  current liabilities                                                                                                     |   |                                      | **255.0**   |                                    |   | 270.8 |   |
|                                                                                                                                           |   |                                      |        |                                    |   |   |   |
| Long-term                  debt                                                                                                                |   |                                      | **456.0**   |                                    |   | 410.1 |   |
| Environmental                  liabilities                                                                                                     |   |                                      | **43.6**    |                                    |   | 47.0 |   |
| Pensions                  and postretirement benefits                                                                                          |   |                                      | **102.7**   |                                    |   | 75.8 |   |
| Deferred                  income taxes                                                                                                         |   |                                      | **9.6**     |                                    |   | 17.0 |   |
| Other                  long-term liabilities                                                                                                   |   |                                      | **14.2**    |                                    |   | 7.0 |   |
| Total                  liabilities                                                                                                             |   |                                      | **881.1**   |                                    |   | 827.7 |   |
|                                                                                                                                           |   |                                      |        |                                    |   |   |   |
| Stockholders’                  equity:                                                                                                   |   |                                      |        |                                    |   |   |   |
| Common                  stock, $1 par value; authorized, 60 million shares; outstanding,                  19.8                  million shares |   |                                      | **19.8**    |                                    |   | 19.6 |   |
| Additional                  paid-in capital                                                                                                    |   |                                      | **93.6**    |                                    |   | 96.6 |   |
| Unearned                  compensation                                                                                                         |   |                                      | —     |                                    |   | (3.9 | ) |
| Accumulated                  other comprehensive (loss)                                                                                        |   |                                      | **(16.7**   | **)**                                   |   | (10.9 | ) |
| Retained                  earnings                                                                                                             |   |                                      | **137.0**   |                                    |   | 193.9 |   |
| Total                  stockholders’ equity                                                                                              |   |                                      | **233.7**   |                                    |   | 295.3 |   |
| Total                  liabilities and stockholders’ equity                                                                              |   | **$**                                     | **1,114.8** |                                    | $      | 1,123.0 |   |

----

**CHESAPEAKE        CORPORATION**

**Consolidated        Statements of Income**

**and        Comprehensive Income**

| **For                      the fiscal years ended:**(***in                      millions, except per share data***)                                                 |   | **December                      31, 2006** |           | **January                       1,****2006** |                        | **January                      2,****2005** |    |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------|----------------|---------------------------------------------------|-----------------------------|---------------------------------------------|---------|
|                                                                                                                                                                |   |                                       |           |                                              |                        |                                        |    |
| Income:                                                                                                                                                             |   |                                       |           |                                              |                        |                                        |    |
| Net                      sales                                                                                                                                      |   | **$**                                      | **995.4**      |                                              | $                           | 1,009.2                                     |    | $ | 997.9 |   |
| Cost                      of products sold                                                                                                                          |   |                                       | **820.1**      |                                              |                        | 827.8                                       |    |   | 819.7 |   |
| Selling,                      general and administrative expenses                                                                                                   |   |                                       | **134.1**      |                                              |                        | 135.2                                       |    |   | 127.8 |   |
| Goodwill                      impairment charge                                                                                                                     |   |                                       | **14.3**       |                                              |                        | 312.0                                       |    |   | — |   |
| Restructuring                      expenses, asset impairments and other exit                      costs                                                            |   |                                       | **33.4**       |                                              |                        | 10.7                                        |    |   | — |   |
| (Gain)                      loss on divestitures                                                                                                                    |   |                                       | **(3.1**       | **)**                                             |                        | 2.8                                         |    |   | — |   |
| Other                      income, net                                                                                                                              |   |                                       | **3.7**        |                                              |                        | 1.5                                         |    |   | 8.5 |   |
| Operating                      income (loss)                                                                                                                        |   |                                       | **0.3**        |                                              |                        | (277.8                                      | )       |   | 58.9 |   |
| Interest                      expense, net                                                                                                                          |   |                                       | **39.8**       |                                              |                        | 32.8                                        |    |   | 36.7 |   |
| Loss                      on extinguishment of debt                                                                                                                 |   |                                       | **0.6**        |                                              |                        | 0.5                                         |    |   | 9.6 |   |
| (Loss)                      income from continuing operations before taxes                                                                                          |   |                                       | **(40.1**      | **)**                                             |                        | (311.1                                      | )       |   | 12.6 |   |
| Income                      tax benefit                                                                                                                             |   |                                       | **(7.7**       | **)**                                             |                        | (4.4                                        | )       |   | (3.6 | ) |
| (Loss)                      income from continuing operations                                                                                                       |   |                                       | **(32.4**      | **)**                                             |                        | (306.7                                      | )       |   | 16.2 |   |
| (Loss)                      from discontinued operations, net of income tax (benefit) expense                      of $0.0,                      $0.1 and $(0.1)    |   |                                       | **(4.4**       | **)**                                             |                        | (5.2                                        | )       |   | (4.7 | ) |
| (Loss)                      gain on disposal of discontinued operations, net of income                      tax expense of                      $0.0, $0.0 and $0.1 |   |                                       | **(2.8**       | **)**                                             |                        | (2.4                                        | )       |   | 0.2 |   |
| Net                      (loss) income                                                                                                                              |   | **$**                                      | **(39.6**      | **)**                                             | $                           | (314.3                                      | )       | $ | 11.7 |   |
|  Basic                      earnings per share:                                                                                                                |   |                                       |           |                                              |                        |                                        |    |   |   |   |
| (Loss)                      earnings from continuing operations                                                                                                     |   | **$**                                      | **(1.67**      | **)**                                             | $                           | (15.81                                      | )       | $ | 0.88 |   |
| Discontinued                      operations, net of income taxes                                                                                                   |   |                                       | **(0.37**      | **)**                                             |                        | (0.39                                       | )       |   | (0.25 | ) |
| Basic                      (loss) earnings per share                                                                                                                |   | **$**                                      | **(2.04**      | **)**                                             | $                           | (16.20                                      | )       | $ | 0.63 |   |
|  Diluted                      earnings per share:                                                                                                              |   |                                       |           |                                              |                        |                                        |    |   |   |   |
| (Loss)                      earnings from continuing operations                                                                                                     |   | **$**                                      | **(1.67**      | **)**                                             | $                           | (15.81                                      | )       | $ | 0.88 |   |
| Discontinued                      operations, net of income taxes                                                                                                   |   |                                       | **(0.37**      | **)**                                             |                        | (0.39                                       | )       |   | (0.25 | ) |
| Diluted                      (loss) earnings per share                                                                                                              |   | **$**                                      | **(2.04**      | **)**                                             | $                           | (16.20                                      | )       |  $ | 0.63 |   |
|  Comprehensive                      income:                                                                                                                    |   |                                       |           |                                              |                        |                                        |    |   |   |   |
|  Net                      (loss) income                                                                                                                        |   |                      **$**            | **(39.6**      | **)**                                             |                      $ | (314.3                                      | )       |                      $ | 11.7 |   |
|  Other                      comprehensive income:                                                                                                              |   |                                       |           |                                              |                        |                                        |    |   |   |   |
| Minimum                      pension liability (net of deferred taxes of $15.6, $1.4 and                      $(0.2))                                               |   |                                       | **27.1**       |                                              |                        | (3.1                                        | )       |   | 0.3 |   |
| Foreign                      currency translation                                                                                                                   |   |                                       | **40.2**       |                                              |                        | (76.9                                       | )       |   | 52.5 |   |
| Change                      in fair market value of derivatives (net of deferred taxes                      of $0.0, $0.0                      and $(0.3)           |   |                                       | **4.8**        |                                              |                        | (5.8                                        | )       |   | 0.9 |   |
| Comprehensive                    (loss) income                                                                                                                      |   | **$**                                      | **32.5**  |                                              | $                           | (400.1                                      | )  | $  | 65.4  |   |

----

**CHESAPEAKE        CORPORATION**

**Consolidated        Statements of Cash Flows**

| **For                    the fiscal years ended:**(***in                    millions***)                                       |   | **December                    31,****2006** |      | **January                    1,****2006** |   | **January                    2,****2005** |   |
|--------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|-----------|-------------------------------------------|--------|-------------------------------------------|--------|
| Operating                    activities:                                                                                       |   |                                        |      |                                      |   |                                      |   |
| Net                    (loss) income                                                                                           |   | **$**                                       | **(39.6** | **)**                                     | $      | (314.3                                    | )      | $ | 11.7 |   |
| Adjustments                    to reconcile net (loss) income to net cash provided by operating                    activities: |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Depreciation                    and amortization                                                                               |   |                                        | **56.6**  |                                      |   | 59.2                                      |   |   | 61.0 |   |
| Goodwill                    impairment charge                                                                                  |   |                                        | **14.3**  |                                      |   | 312.0                                     |   |   | — |   |
| Asset                    impairment charge                                                                                     |   |                                        | **27.9**  |                                      |   | —                                   |   |   | — |   |
| Deferred                    income taxes                                                                                       |   |                                        | **(7.9**  | **)**                                     |   | (11.4                                     | )      |   | (10.1 | ) |
| Loss                    on extinguishment of debt                                                                              |   |                                        | **0.6**   |                                      |   | 0.5                                       |   |   | 9.6 |   |
| Gain                    on sale of property, plant and equipment                                                               |   |                                        | **(2.9**  | **)**                                     |   | (1.3                                      | )      |   | (8.4 | ) |
| Loss                    (gain) on divestitures                                                                                 |   |                                        | **(1.7**  | **)**                                     |   | 5.8                                       |   |   | — |   |
| Non-cash                    pension expense                                                                                    |   |                                        | **19.5**  |                                      |   | 12.3                                      |   |   | 7.6 |   |
| Changes                    in operating assets and liabilities, net of acquisitions and                    dispositions:       |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Accounts                    receivable, net                                                                                    |   |                                        | **(10.6** | **)**                                     |   | 0.8                                       |   |   | 15.8 |   |
| Inventories                                                                                                                    |   |                                        | **0.7**   |                                      |   | (6.1                                      | )      |   | 4.4 |   |
| Other                    assets                                                                                                |   |                                        | **3.2**   |                                      |   | 0.6                                       |   |   | 3.4 |   |
| Accounts                    payable and accrued expenses                                                                       |   |                                        | **(9.9**  | **)**                                     |   | 4.5                                       |   |   | (5.1 | ) |
| Income                    taxes payable                                                                                        |   |                                        | **(7.4**  | **)**                                     |   | 2.1                                       |   |   | 18.9 |   |
| Premium                    paid for early extinguishment of debt                                                               |   |                                        | **(0.5**  | **)**                                     |   | (0.4                                      | )      |   | (8.1 | ) |
| Contributions                    to benefit plans                                                                              |   |                                        | **(26.8** | **)**                                     |   | (24.4                                     | )      |   | (18.4 | ) |
| Settlement                    of interest rate swaps                                                                           |   |                                        | —   |                                      |   | —                                   |   |   | 6.4 |   |
| Other                                                                                                                          |   |                                        | **6.2**   |                                      |   | 4.7                                       |   |   | 4.4 |   |
| Net                    cash provided by operating activities                                                                   |   |                                        | **21.7**  |                                      |   | 44.6                                      |   |   | 93.1 |   |
|                                                                                                                           |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Investing                    activities:                                                                                       |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Purchases                    of property, plant and equipment                                                                  |   |                                        | **(35.8** | **)**                                     |   | (38.3                                     | )      |   | (35.5 | ) |
| Acquisitions                                                                                                                   |   |                                        | —   |                                      |   | (78.4                                     | )      |   | — |   |
| Divestitures                                                                                                                   |   |                                        | **19.2**  |                                      |   | —                                   |   |   | — |   |
| Proceeds                    from sales of property, plant and equipment                                                        |   |                                        | **9.9**   |                                      |   | 5.6                                       |   |   | 14.3 |   |
| Other                                                                                                                          |   |                                        | —   |                                      |   | 0.5                                       |   |   | 0.7 |   |
| Net                    cash (used in) investing activities                                                                     |   |                                        | **(6.7**  | **)**                                     |   | (110.6                                    | )      |   | (20.5 | ) |
|                                                                                                                           |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Financing                    activities:                                                                                       |   |                                        |      |                                      |   |                                      |   |   |   |   |
| Net                    borrowings (payments) on credit lines                                                                   |   |                                        | **22.5**  |                                      |   | 116.5                                     |   |   | (43.6 | ) |
| Payments                    on long-term debt                                                                                  |   |                                        | **(23.5** | **)**                                     |   | (81.2                                     | )      |   | (198.9 | ) |
| Proceeds                    from long-term debt                                                                                |   |                                        | **3.6**   |                                      |   | 3.3                                       |   |   | 139.7 |   |
| Proceeds                    from issuance of common stock, net of issuance costs                                               |   |                                        | —   |                                      |   | —                                   |   |   | 93.4 |   |
| Debt                    issuance costs                                                                                         |   |                                        | **(0.9**  | **)**                                     |   | —                                   |   |   | (6.1 | ) |
| Dividends                    paid                                                                                              |   |                                        | **(17.1** | **)**                                     |   | (17.1                                     | )      |   | (16.1 | ) |
| Other                                                                                                                          |   |                                        | —   |                                      |   | (0.1                                      | )      |   | — |   |
| Net                    cash (used in) provided by financing activities                                                         |   |                                        | **(15.4** | **)**                                     |   | 21.4                                      |   |   | (31.6 | ) |
| Effect                    of foreign exchange rate changes on cash and cash                    equivalents                     |   |                                        | **(0.5**  | **)**                                     |   | (1.0                                      | )      |   | 1.4 |   |
| (Decrease)                    increase in cash and cash equivalents                                                            |   |                                        | **(0.9**  | **)**                                     |   | (45.6                                     | )      |   | 42.4 |   |
| Cash                    and cash equivalents at beginning of year                                                              |   |                                        | **8.7**   |                                      |   | 54.3                                      |   |   | 11.9 |   |
| Cash                    and cash equivalents at end of year                                                                    |   | **$**                                       | **7.8**   |                                      | $      | 8.7                                       |   | $ | 54.3 |   |

----

**CHESAPEAKE        CORPORATION**

**Consolidated        Statements of Changes in Stockholders’ Equity**

| **For                  the fiscal years ended:**(***in                  millions***) |   | **December                  31,****2006** |        | **January                  1,****2006** |   | **January                  2,****2005** |   |
|--------------------------------------------------------------------------------------|--------|-------------------------------------------|-------------|-----------------------------------------|--------|-----------------------------------------|--------|
| Common                  stock:                                                       |   |                                      |        |                                    |   |                                    |   |
| Balance,                  beginning of year                                          |   | **$**                                     | **19.6**    |                                    | $      | 19.6                                    |   | $ | 15.3 |   |
| Issuance                  from public stock offering                                 |   |                                      | —     |                                    |   | —                                 |   |   | 4.1 |   |
| Issuance                  for employee stock plans                                   |   |                                      | **0.2**     |                                    |   | —                                 |   |   | 0.2 |   |
| Balance,                  end of year                                                |   |                                      | **19.8**    |                                    |   | 19.6                                    |   |   | 19.6 |   |
|                                                                                 |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Additional                  paid-in capital:                                         |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Balance,                  beginning of year                                          |   |                                      | **96.6**    |                                    |   | 96.1                                    |   |   | 4.4 |   |
| Issuance                  from public stock offering, net of issuance costs          |   |                                      | —     |                                    |   | —                                 |   |   | 87.7 |   |
| Issuance                  for employee stock plans, net of forfeitures               |   |                                      | **0.2**     |                                    |   | 0.5                                     |   |   | 4.0 |   |
| Elimination                  of unearned compensation upon adoption of SFAS 123(R)   |   |                                      | **(3.9**    | **)**                                   |   | —                                 |   |   | — |   |
| Compensation                  expense                                                |   |                                      | **0.7**     |                                    |   | —                                 |   |   | — |   |
| Balance,                  end of year                                                |   |                                      | **93.6**    |                                    |   | 96.6                                    |   |   | 96.1 |   |
|                                                                                 |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Unearned                  compensation:                                              |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Balance,                  beginning of year                                          |   |                                      | **(3.9**    | **)**                                   |   | (3.7                                    | )      |   | (1.4 | ) |
| Compensation                  expense                                                |   |                                      | **—** |                                    |   | 0.1                                     |   |   | 0.7 |   |
| Issuance                  for employee stock plans, net of forfeitures               |   |                                      | **—** |                                    |   | (0.3                                    | )      |   | (3.0 | ) |
| Elimination                  of unearned compensation upon adoption of SFAS 123(R)   |   |                                      | **3.9**     |                                    |   | —                                 |   |   | — |   |
| Balance,                  end of year                                                |   |                                      | **—** |                                    |   | (3.9                                    | )      |   | (3.7 | ) |
|                                                                                 |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Accumulated                  other comprehensive (loss) income:                      |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Balance,                  beginning of year                                          |   |                                      | **(10.9**   | **)**                                   |   | 74.9                                    |   |   | 21.2 |   |
| Currency                  translation adjustment                                     |   |                                      | **40.2**    |                                    |   | (76.9                                   | )      |   | 52.5 |   |
| Minimum                  pension liability adjustment                                |   |                                      | **27.1**    |                                    |   | (3.1                                    | )      |   | 0.3 |   |
| Change                  in fair market value of derivatives                          |   |                                      | **4.8**     |                                    |   | (5.8                                    | )      |   | 0.9 |   |
| Adoption                  of FASB Statement No. 158                                  |   |                                      | **(77.9**   | **)**                                   |   | —                                 |   |   | — |   |
| Balance,                  end of year                                                |   |                                      | **(16.7**   | **)**                                   |   | (10.9                                   | )      |   | 74.9 |   |
|                                                                                 |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Retained                  earnings:                                                  |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Balance,                  beginning of year                                          |   |                                      | **193.9**   |                                    |   | 525.3                                   |   |   | 530.6 |   |
| Net                  (loss) income                                                   |   |                                      | **(39.6**   | **)**                                   |   | (314.3                                  | )      |   | 11.7 |   |
| Cash                  dividends declared                                             |   |                                      | **(17.3**   | **)**                                   |   | (17.1                                   | )      |   | (17.0 | ) |
| Balance,                  end of year                                                |   |                                      | **137.0**   |                                    |   | 193.9                                   |   |   | 525.3 |   |
|                                                                                 |   |                                      |        |                                    |   |                                    |   |   |   |   |
| Stockholders’                  equity, end of year                             |   | **$**                                     | **233.7**   |                                    | $      | 295.3                                   |   | $ | 712.2 |   |

----

**CHESAPEAKE        CORPORATION**

**Notes        to Consolidated Financial        Statements**| **1  ** | **Summary                  of Significant Accounting                  Policies** |
|-------------------|----------------------------------------------------------------------------------|

***Financial        Statement Presentation***

***Use        of Estimates***

***Revenue        Recognition***

***Foreign        Currency Translation***

***Inventories***

***Accounts        Receivable***

----

***Property,        Plant and Equipment***

***Goodwill***

***Financial        Instruments***

----

***Income        Taxes***

*Accounting        for Income Taxes*

***Share-Based        Compensation***

*Share-Based        Payment*
*Accounting        for Stock Issued to Employees, and Related Interpretations *
*Accounting        for Stock-Based Compensation *

----

***Environmental        Liabilities***

***Accruals        Related to Restructuring Activities***

***New        Accounting Pronouncements***

*Accounting        for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109,        Accounting for Income Taxes*

*Fair        Value Measurements *

*Employers'        Accounting for Defined Benefit Pension and Other Postretirement Plans-an        amendment of FASB Statements No. 87, 88, 106, and 132(R) ("SFAS        158")*

----

*Considering        the Effects of Prior Year Misstatements when Quantifying Misstatements in        Current Year Financial Statements*

| **2  ** | **Acquisitions** |
|-------------------|------------------|

*Business        Combinations*
*Goodwill        and Other Intangible Assets*

| **Purchase                  Price**                           |   |   |   |
|---------------------------------------------------------------|--------|--------|--------|
| *(in                  millions)*                              |   |   |   |
|                                                          |   |   |   |
| Purchase                  price per agreement                 |   | $      | 65.0   |   |
| Less                  working capital and related adjustments |   |   | (0.6   | ) |
| Capitalized                  transaction costs                |   |   | 1.4    |   |
| Total                  purchase price                         |   | $      | 65.8   |   |

----

|                                                            |   |   |   |
|-----------------------------------------------------------------|--------|--------|--------|
| Accounts                  receivable                            |   | $      | 4.7    |   |
| Inventories                                                     |   |   | 2.3    |   |
| Prepaid                  expenses and other current assets      |   |   | 0.3    |   |
| Property                  and equipment                         |   |   | 11.7   |   |
| Goodwill                                                        |   |   | 32.1   |   |
| Intangible                  assets                              |   |   | 16.3   |   |
| Accrued                  expenses and other current liabilities |   |   | (1.6   | ) |
| Total                  purchase price                           |   | $      | 65.8   |   |

| **3  ** | **Discontinued                Operations** |
|-------------------|--------------------------------------------|

| ***(in                    millions)*** | **12                    Months Ended** |
|----------------------------------------|----------------------------------------|
|                                   | **2006**                               |   | **2005** |   | **2004** |   |   |   |
| Revenue                                | $                                      | 16.7 |   | $ | 32.9 |   | $ | 34.3 |   |   |   |
|                                   |                                   |   |   |   |   |   |   |   |   |   |   |
| Pre-tax                    loss        | $                                      | (4.4) |   | $ | (5.2) |   | $ | (4.5) |   |   |   |
|                                   |                                   |   |   |   |   |   |   |   |   |   |   |

----

| **4  ** | **(Gain)                Loss on Divestitures** |
|-------------------|------------------------------------------------|

----

| **5  ** | **Goodwill                and Intangible Assets** |
|-------------------|---------------------------------------------------|

| (***in                  millions***)                |   | **Paperboard                  Packaging** |    | **Plastic                  Packaging** |   | **Total** |   |
|-----------------------------------------------------|--------|-------------------------------------------|---------|----------------------------------------|--------|-----------|--------|
| Balance                  January 2, 2005            |   | $                                         | 625.5   |                                   | $      | 69.1      |   | $ | 694.6 |   |
| Goodwill                  acquired                  |   |                                      | 32.1    |                                   |   | 9.0       |   |   | 41.1 |   |
| Impairment                  loss                    |   |                                      | (312.0  | )                                      |   | —   |   |   | (312.0 | ) |
| Foreign                  currency translation       |   |                                      | (62.5   | )                                      |   | (7.2      | )      |   | (69.7 | ) |
| Balance                  January 1, 2006            |   |                                      | 283.1   |                                   |   | 70.9      |   |   | 354.0 |   |
| Goodwill                  purchase price adjustment |   |                                      | (0.7    | )                                      |   | —   |   |   | (0.7 | ) |
| Divestiture                                         |   |                                      | — |                                   |   | (5.6      | )      |   | (5.6 | ) |
| Impairment                  loss                    |   |                                      | (14.3   | )                                      |   | —   |   |   | (14.3 | ) |
| Foreign                  currency translation       |   |                                      | 38.5    |                                   |   | 9.3       |   |   | 47.8 |   |
| Balance                  December 31, 2006          |   | $                                         | 306.6   |                                   | $      | 74.6      |   | $ | 381.2 |   |

| 2007 | $1.6                        |
|------|-----------------------------|
| 2008 |                    1.6 |
| 2009 |                    1.6 |
| 2010 |                    1.6 |
| 2011 |                    1.6 |

----

| **6  ** | **Restructuring                Charges** |
|-------------------|------------------------------------------|

| ***(in                    millions)***                                                                                                                              |   | 12                    Months Ended |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|--------|
|                                                                                                                                                                |   | Dec.                    31, 2006   |   | Jan.                    1, 2006 |   |
| Employee-related                    costs                                                                                                                           |   | $                                  | 9.8    |   | $ | 12.2 |   |
| Asset                    impairment                                                                                                                                 |   |                               | 27.9   |   |   | - |   |
| Loss                    on asset sales, redeployment costs, and other exit costs                                                                                    |   |                               | (0.3   | ) |   | 0.9 |   |
| Total                    restructuring expenses, asset impairment and other exit                    costs                                                           |   |                               | 37.4   |   |   | 13.1 |   |
| Less:                    Restructuring expenses, asset impairments and other exit costs                    attributed                    to discontinued operations |   |                               | 4.0    |   |   | 2.4 |   |
| Restructuring                    expenses, asset impairments and other exit costs attributed to                    continuing                    operations         |   | $                                  | 33.4   |   | $ | 10.7 |   |

----

| (***in                  millions***)                                                                                              |   | **Employee-related                  Costs** |    | **Asset                  Impairments** |   | **Other                  Exit Costs** |   | **Total** |    |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|---------|----------------------------------------|--------|---------------------------------------|--------|-----------|---------|
| Balance                  January 2, 2005                                                                                          |   | $                                           | — |                                   | $      | —                               |   | $         | — |   | $ | — |   |
| Restructuring                  charges, asset impairments and other exit costs, continuing                  operations            |   |                                        | 9.8     |                                   |   | —                               |   |      | 0.9     |   |   | 10.7 |   |
| Restructuring                  charges, asset impairments and other exit costs, discontinued                  operations          |   |                                        | 2.4     |                                   |   | —                               |   |      | — |   |   | 2.4 |   |
|                          Cash payments in 2005                                                 |   |                                        | (5.6    | )                                      |   | —                               |   |      | — |   |   | (5.6 | ) |
|                          Other items - non cash                                                |   |                                        | 0.3     |                                   |   | —                               |   |      | (0.9    | ) |   | (0.6 | ) |
| Balance                  January 1, 2006                                                                                          |   |                                        | 6.9     |                                   |   | —                               |   |      | — |   |   | 6.9 |   |
| Restructuring                  charges, asset impairments and other exit costs (benefits), continuing                  operations |   |                                        | 9.0     |                                   |   | 24.9                                  |   |      | (0.5    | ) |   | 33.4 |   |
| Restructuring                  charges, asset impairments and other exit costs, discontinued                  operations          |   |                                        | 0.8     |                                   |   | 3.0                                   |   |      | 0.2     |   |   | 4.0 |   |
|                          Cash payments                                                         |   |                                        | (14.7   | )                                      |   | —                               |   |      | (1.6    | ) |   | (16.3 | ) |
|                          Asset impairments                                                     |   |                                        | — |                                   |   | (27.9                                 | )      |      | — |   |   | (27.9 | ) |
|                          Gain on asset sales                                                   |   |                                        | — |                                   |   | —                               |   |      | 2.4     |   |   | 2.4 |   |
|                          Other items - non cash                                                |   |                                        | 0.5     |                                   |   | —                               |   |      | — |   |   | 0.5 |   |
| Balance                  December 31, 2006                                                                                        |   | $                                           | 2.5     |                                   | $      | —                               |   | $         | 0.5     |   | $ | 3.0 |   |

| **7  ** | **Inventories** |
|-------------------|-----------------|

| (***in                  millions***)    |   | **2006** |      | 2005   |   |
|-----------------------------------------|--------|----------|-----------|--------|--------|
| Finished                  goods         |   | **$**    | **59.5**  |   | $      | 61.0 |   |
| Work-in-process                         |   |     | **21.3**  |   |   | 19.7 |   |
| Materials                  and supplies |   |     | **28.6**  |   |   | 27.8 |   |
| Total                                   |   | **$**    | **109.4** |   | $      | 108.5 |   |

----

| **8  ** | **Long-Term                Debt** |
|-------------------|-----------------------------------|

| (***in                  millions***)                         |   | **2006** |        | 2005   |   |
|--------------------------------------------------------------|--------|----------|-------------|--------|--------|
| Notes                  payable - banks:                      |   |     |        |   |   |
| Credit                  lines                                |   | **$**    | **138.6**   |   | $      | 114.5 |   |
| Unsecured                  notes:                            |   |     |        |   |   |   |   |
| 10.375%                  Senior Subordinated Notes, due 2011 |   |     | **131.4**   |   |   | 124.0 |   |
| 7%                  Senior Subordinated Notes, due 2014      |   |     | **132.0**   |   |   | 118.3 |   |
| Loan                  notes, average interest 4.6%, due 2006 |   |     | **—** |   |   | 7.6 |   |
| IDA                  notes, average interest 6.3%, due 2019  |   |     | **50.0**    |   |   | 50.0 |   |
| Other                  debt, average interest 4.9%           |   |     | **15.8**    |   |   | 18.5 |   |
| Total                  debt                                  |   |     | **467.8**   |   |   | 432.9 |   |
| Less                  current portion                        |   |     | **11.8**    |   |   | 22.8 |   |
| Total                  long-term debt                        |   | **$**    | **456.0**   |   | $      | 410.1 |   |

----

| **9  ** | **Financial                Instruments and Risk                Concentration** |
|-------------------|--------------------------------------------------------------------------------|

----

| **10  ** | **Income                Taxes** |
|--------------------|---------------------------------|

| ***(in                  millions)***         |   | **2006** |        | **2005** |   | **2004** |   |
|----------------------------------------------|--------|----------|-------------|----------|--------|----------|--------|
| Current                  (benefit) expense:  |   |     |        |     |   |     |   |
| Federal                                      |   | **$**    | **(2.7**    | **)**    | $      | (2.1     | )      | $ | (1.6 | ) |
| State                                        |   |     | **—** |     |   | (0.8     | )      |   | (0.4 | ) |
| Foreign                                      |   |     | **2.9**     |     |   | 9.9      |   |   | 8.5 |   |
| Total                  current               |   | **$**    | **0.2**     |     | $      | 7.0      |   | $ | 6.5 |   |
| Deferred                  expense (benefit): |   |     |        |     |   |     |   |   |   |   |
| Federal                                      |   | **$**    | **2.8**     |     | $      | (2.8     | )      | $ | (8.9 | ) |
| State                                        |   |     | **(0.2**    | **)**    |   | (0.4     | )      |   | — |   |
| Foreign                                      |   |     | **(10.5**   | **)**    |   | (8.2     | )      |   | (1.2 | ) |
| Total                  deferred              |   |     | **(7.9**    | **)**    |   | (11.4    | )      |   | (10.1 | ) |
| Total                  income taxes          |   | **$**    | **(7.7**    | **)**    | $      | (4.4     | )      | $ | (3.6 | ) |

| ***(in                  millions)***                                     |   | **2006** |      | **2005** |   |
|--------------------------------------------------------------------------|--------|----------|-----------|----------|--------|
|                                                                     |   |     |      |     |   |
| Pension                  accrual                                         |   | **$**    | **27.7**  |     | $      | 14.0 |   |
| Accrued                  liabilities                                     |   |     | **8.4**   |     |   | 6.4 |   |
| Tax                  credit and net operating loss carryforward benefits |   |     | **34.7**  |     |   | 19.8 |   |
| Deferred                  income                                         |   |     | **1.4**   |     |   | 1.7 |   |
| Other                                                                    |   |     | **0.4**   |     |   | 2.6 |   |
| Total                  deferred tax assets                               |   |     | **72.6**  |     |   | 44.5 |   |
| Valuation                  allowance                                     |   |     | **(42.6** | **)**    |   | (17.4 | ) |
| Net                  deferred tax assets                                 |   |     | **30.0**  |     |   | 27.1 |   |
| Accumulated                  depreciation/amortization                   |   |     | **(30.8** | **)**    |   | (36.8 | ) |
| Other                                                                    |   |     | **(0.1**  | **)**    |   | (2.1 | ) |
| Deferred                  tax liabilities                                |   |     | **(30.9** | **)**    |   | (38.9 | ) |
| Net                  deferred taxes                                      |   | **$**    | **(0.9**  | **)**    | $      | (11.8 | ) |

| Balance                  sheet presentation:                                                                                                 |   |   |     |   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|----------|--------|--------|
| Current                  deferred income taxes (included within prepaid expenses and other                  current                  assets) |   | **$**  | **0.4**  |   | $      | 0.8 |   |
| Deferred                  income taxes (included within other assets)                                                                        |   |   | **8.3**  |   |   | 4.4 |   |
| Deferred                  income taxes                                                                                                       |   |   | **(9.6** | **)**  |   | (17.0 | ) |
|                                                                                                                                         |   |   |     |   |   |   |   |

----

|                                                                     |   | **2006** |        | **2005** |       | **2004** |   |
|--------------------------------------------------------------------------|--------|----------|-------------|----------|------------|----------|--------|
| ***(in                  millions, except percentages)***                 |   |     |        |     |       |     |   |
| Earnings                  from continuing operations before income taxes |   | **$**    | **(40.1**   | **)**    | $          | (311.1   | )      | $ | 12.6 |   |
| Tax                  expense at U.S. statutory rate of 35%               |   |     | **(14.0**   | **)**    |       | (108.9   | )      |   | 4.4 |   |
| State                  income taxes, net of federal benefit              |   |     | **(1.0**    | **)**    |       | (1.1     | )      |   | (0.3 | ) |
| Foreign                  income taxes rate differential                  |   |     | **(3.5**    | **)**    |       | (4.8     | )      |   | (4.7 | ) |
| Non-deductible                  goodwill                                 |   |     | **5.0**     |     |       | 105.0    |   |   | — |   |
| Valuation                  allowances                                    |   |     | **15.1**    |     |       | 7.5      |   |   | 1.4 |   |
| Tax                  audit settlements and tax return adjustments        |   |     | **(3.5**    | **)**    |       | (2.1     | )      |   | (3.6 | ) |
| Tax                  rate adjustments                                    |   |     | **—** |     |       | —  |   |   | (0.8 | ) |
| Tax/book                  basis differences                              |   |     | **(5.7**    | **)**    |       | —  |   |   | — |   |
| Other                  permanent items                                   |   |     | **(0.1**    | **)**    |       | —  |   |   | — |   |
| Total                  tax expense (benefit)                             |   | **$**    | **(7.7**    | **)**    | $          | (4.4     | )      | $ | (3.6 | ) |
|                                                                     |   |     |        |     |       |     |   |   |   |   |
| Effective                  income tax rate                               |   |     | **19.2**    | **%**    | ** ** | 1.4      | %      |   | (28.6 | )% |

| (***in                  millions***)                                          |   | **2006** |      | **2005** |   | **2004** |   |
|-------------------------------------------------------------------------------|--------|----------|-----------|----------|--------|----------|--------|
|                                                                          |   |     |      |     |   |     |   |
| Domestic                                                                      |   | **$**    | **(16.0** | **)**    | $      | (36.0    | )      | $ | (28.1 | ) |
| Foreign                                                                       |   |     | **(24.1** | **)**    |   | (275.1   | )      |   | 40.7 |   |
|                                                                          |   |     |      |     |   |     |   |   |   |   |
| (Loss)                  income from continuing operations before income taxes |   | **$**    | **(40.1** | **)**    | $      | (311.1   | )      | $ | 12.6 |   |

| **11  ** | **Employee                Retirement and Postretirement                Benefits** |
|--------------------|-----------------------------------------------------------------------------------|

----

*Employers’        Accounting for Defined Benefit Pension and Other Postretirement Plans - an        amendment of FASB Statements No. 87, 88, 106, and 132(R)*

|                                                           |   | **Pre-SFAS                  158** |   | **SFAS                  158 Adoption Adjustments** |   | **Post-SFAS                  158** |   |
|----------------------------------------------------------------|--------|-----------------------------------|--------|----------------------------------------------------|--------|------------------------------------|--------|
| (***in                  millions***)                           |   |                              |   |                                               |   |                               |   |
| *Assets*                                                       |   |                              |   |                                               |   |                               |   |
| Prepaid                  expenses and other current assets     |   | $                                 | 21.7   |                                               | $      | (1.3                               | )      | $ | 20.4 |   |
| Other                  assets                                  |   |                              | 114.0  |                                               |   | (21.4                              | )      |   | 92.6 |   |
| *Liabilities*                                                  |   |                              |   |                                               |   |                               |   |   |   |   |
| Accrued                  expenses                              |   |                              | 82.9   |                                               |   | 1.0                                |   |   | 83.9 |   |
| Pension                  and postretirement benefits           |   |                              | 25.1   |                                               |   | 77.6                               |   |   | 102.7 |   |
| Deferred                  income taxes                         |   |                              | 33.0   |                                               |   | (23.4                              | )      |   | 9.6 |   |
| *Stockholders’                  Equity*                  |   |                              |   |                                               |   |                               |   |   |   |   |
| Accumulated                  other comprehensive income (loss) |   |                              | 61.2   |                                               |   | (77.9                              | )      |   | (16.7 | ) |

----

|                                    |   | **Pension** |   | **Postretirement** |   | **Total** |   |
|-----------------------------------------|--------|-------------|--------|--------------------|--------|-----------|--------|
| (***in                  millions***)    |   |        |   |               |   |      |   |   |   |   |
| Prior                  service (credit) |   | $           | (0.3   | )                  | $      | (0.4      | )      | $ | (0.7 | ) |
| Net                  loss               |   |        | 8.7    |               |   | 0.8       |   |   | 9.5 |   |

|                                                                             |   |                                  |     |                                     |   |     |   |   |      | **Postretirement                  Benefits** |   |
|----------------------------------------------------------------------------------|--------|---------------------------------------|----------|------------------------------------------|--------|----------|--------|--------|-----------|----------------------------------------------|--------|
|                                                                             |   | **Pension                  Benefits** |     | **Other                  Than Pensions** |   |
|                                                                             |   | **U.S.                  Plans**       |     | **Non                  U.S. Plans**      |   |     |   |
| (***in                  millions***)                                             |   | **2006**                              |     | 2005                                     |   | **2006** |   | 2005   |      | **2006**                                     |   | 2005 |   |
| Benefit                  obligation at beginning of year                         |   | **$**                                 | **71.7** |                                     | $      | 67.2     |   | **$**  | **409.6** |                                         | $      | 365.2 |   | **$** | **14.3** |   | $ | 16.0 |   |
| Service                  cost                                                    |   |                                  | **0.2**  |                                     |   | 0.5      |   |   | **7.2**   |                                         |   | 5.7 |   |   | — |   |   | — |   |
| Interest                  cost                                                   |   |                                  | **3.9**  |                                     |   | 3.8      |   |   | **21.6**  |                                         |   | 19.2 |   |   | **0.7** |   |   | 0.9 |   |
| Plan                  participants’ contributions                          |   |                                  | —  |                                     |   | —  |   |   | **5.0**   |                                         |   | 5.1 |   |   | **0.2** |   |   | 0.2 |   |
| Actuarial                  (gain) loss                                           |   |                                  | **(1.4** | **)**                                    |   | 5.2      |   |   | **(34.3** | **)**                                        |   | 64.0 |   |   | **2.9** |   |   | 0.1 |   |
| Exchange                  rate changes/other                                     |   |                                  | —  |                                     |   | —  |   |   | **56.6**  |                                         |   | (38.3 | ) |   | — |   |   | — |   |
| Benefits                  paid                                                   |   |                                  | **(4.7** | **)**                                    |   | (5.0     | )      |   | **(15.1** | **)**                                        |   | (11.3 | ) |   | **(3.2** | **)** |   | (2.9 | ) |
|                                                                             |   |                                  |     |                                     |   |     |   |   |      |                                         |   |   |   |   |   |   |   |   |   |
| Benefit                  obligation at end of year                               |   | **$**                                 | **69.7** |                                     | $      | 71.7     |   | **$**  | **450.6** |                                         | $      | 409.6 |   | **$** | **14.9** |   | $ | 14.3 |   |
|                                                                             |   |                                  |     |                                     |   |     |   |   |      |                                         |   |   |   |   |   |   |   |   |   |
| Fair                  value of plan assets at beginning of year                  |   |                                  | **61.6** |                                     |   | 56.5     |   |   | **281.1** |                                         |   | 247.6 |   |   | — |   |   | — |   |
| Actual                  return on plan assets                                    |   |                                  | **5.1**  |                                     |   | 7.5      |   |   | **37.9**  |                                         |   | 46.3 |   |   | — |   |   | — |   |
| Employer                  contributions                                          |   |                                  | **1.5**  |                                     |   | 2.6      |   |   | **23.2**  |                                         |   | 18.7 |   |   | **3.0** |   |   | 2.7 |   |
| Plan                  participants’ contributions                          |   |                                  | —  |                                     |   | —  |   |   | **5.0**   |                                         |   | 5.2 |   |   | **0.2** |   |   | 0.2 |   |
| Exchange                  rate changes/other                                     |   |                                  | —  |                                     |   | —  |   |   | **44.0**  |                                         |   | (25.4 | ) |   | — |   |   | — |   |
|                                                                             |   |                                  |     |                                     |   |     |   |   |      |                                         |   |   |   |   |   |   |   |   |   |
| Benefits                  paid                                                   |   |                                  | **(4.7** | **)**                                    |   | (5.0     | )      |   | **(15.1** | **)**                                        |   | (11.3 | ) |   | **(3.2** | **)** |   | (2.9 | ) |
|                                                                             |   |                                  |     |                                     |   |     |   |   |      |                                         |   |   |   |   |   |   |   |   |   |
| Fair                  value of plan assets at end of year                        |   | **$**                                 | **63.5** |                                     | $      | 61.6     |   | **$**  | **376.1** |                                         | $      | 281.1 |   | $ | — |   | $ | — |   |
| Funded                  status at end of year                                    |   | **$**                                 | **(6.2** | **)**                                    |   | (10.1    | )      | **$**  | **(74.5** | **)**                                        |   | (128.5 | ) | **$** | **(14.9** | **)** |   | (14.3 | ) |
| Unrecognized                  actuarial loss                                     |   |                                  |     |                                     |   | 35.4     |   |   |      |                                         |   | 161.6 |   |   |   |   |   | 5.4 |   |
| Unrecognized                  prior service cost                                 |   |                                  |     |                                     |   | 0.1      |   |   |      |                                         |   | — |   |   |   |   |   | — |   |
| Contributions                  made between measurement date and fiscal year-end |   |                                  |     |                                     |   | 0.4      |   |   |      |                                         |   | — |   |   |   |   |   | — |   |
|                                                                             |   |                                  |     |                                     |   |     |   |   |      |                                         |   |   |   |   |   |   |   |   |   |
| Net                  amount recognized                                           |   |                                  |     |                                     | $      | 25.8     |   |   |      |                                         | $      | 33.1 |   |   |   |   | $ | (8.9 | ) |

|                                     |   |                                  |     |                                     |   |     |   |   |      | **Postretirement                  Benefits** |   |
|------------------------------------------|--------|---------------------------------------|----------|------------------------------------------|--------|----------|--------|--------|-----------|----------------------------------------------|--------|
|                                     |   | **Pension                  Benefits** |     | **Other                  Than Pensions** |   |
|                                     |   | **U.S.                  Plans**       |     | **Non                  U.S. Plans**      |   |     |   |
| (***in                  millions***)     |   | **2006**                              |     | 2005                                     |   | **2006** |   | 2005   |      | **2006**                                     |   | 2005 |   |
| Net                  loss                |   | **$**                                 | **31.5** |                                     |   | N/A      |   | **$**  | **117.8** |                                         |   | N/A |   | **$** | **7.7** |   |   | N/A |   |
| Prior                  service cost      |   |                                  | **0.5**  |                                     |   | N/A      |   |   | **(0.4**  | **)**                                        |   | N/A |   |   | **—** |   |   | N/A |   |
| Total                  amount recognized |   | **$**                                 | **32.0** |                                     |   |     |   | **$**  | **117.4** |                                         |   |   |   | **$** | **7.7** |   |   |   |   |

----

|                                                                                                                                                  |   |                                  |           |                                     |   |       |   |   |            | **Postretirement                  Benefits** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|----------------|------------------------------------------|--------|------------|--------|--------|-----------------|----------------------------------------------|--------|
|                                                                                                                                                  |   | **Pension                  Benefits** |           | **Other                  Than Pensions** |   |
|                                                                                                                                                  |   | **U.S.                  Plans**       |           | **Non                  U.S. Plans**      |   |       |   |
| (***in                  millions***)                                                                                                                  |   | **2006**                              |           | 2005                                     |   | **2006**   |   | 2005   |            | **2006**                                     |   | 2005 |   |
| Prepaid                  benefit cost                                                                                                                 |   | **$**                                 | **5.9**        |                                     | $      | 28.1       |   | **$**  | **1.6**         |                                         | $      | — |   | **$** | **—** |   | $ | — |   |
| Accrued                  benefit liability                                                                                                            |   |                                  | **(12.1**      | **)**                                    |   | (10.7      | )      |   | **(76.1**       | **)**                                        |   | (55.0 | ) |   | **(14.9** | **)** |   | (8.9 | ) |
| Accumulated                  other comprehensive income                                                                                               |   |                                  | **32.0**       |                                     |   | 8.4        |   |   | **117.4**       |                                         |   | 88.1 |   |   | **7.7** |   |   | — |   |
|                                                                                                                                                  |   |                                  |           |                                     |   |       |   |   |            |                                         |   |   |   |   |   |   |   |   |   |
| Net                  amount recognized                                                                                                                |   | **$**                                 | **25.8**       |                                     | $      | 25.8       |   | **$**  | **42.9**        |                                         | $      | 33.1 |   | **$** | **(7.2** | **)** | $ | (8.9 | ) |
| Pension                  plans in which accumulated benefit obligation exceeds plan assets                  at the                  measurement date: |   |                                  |           |                                     |   |       |   |   |            |                                         |   |   |   |   |   |   |   |   |   |
| Projected                benefit obligation                                                                                                           |   | $                                     | **19.2 ** |                                     | $      | 18.7  |   | $      | **396.1**  |                                         | $      | 398.0 |   |   |   |   |   |   |   |
| Accumulated                benefit obligation                                                                                                         |   |                                  | **16.6 ** |                                     |   | 17.6  |   |   | **338.3**       |                                         |   | 325.2 |   |   |   |   |   |   |   |
| Fair                value of plan assets                                                                                                              |   | $                                     | **7.1 **  |                                     | $      | 6.4   |   | $      | **322.9**       |                                         | $      | 271.5 |   |   |   |   |   |   |   |

|                                           |   |                                  |     |                                     |   |     |   |   |     | **Postretirement                  Benefits** |   |
|------------------------------------------------|--------|---------------------------------------|----------|------------------------------------------|--------|----------|--------|--------|----------|----------------------------------------------|--------|
|                                           |   | **Pension                  Benefits** |     | **Other                  Than Pensions** |   |
|                                           |   | **U.S.                  Plans**       |     | **Non                  U.S. Plans**      |   |     |   |
|                                           |   | **2006**                              |     | 2005                                     |   | **2006** |   | 2005   |     | **2006**                                     |   | 2005 |   |
| Discount                  rate                 |   |                                  | **5.88** | **%**                                    |   | 5.50     | %      |   | **5.00** | **%**                                        |   | 5.00 | % |   | **5.88** | **%** |   | 5.50 | % |
| Rate                  of compensation increase |   |                                  | **4.50** | **%**                                    |   | 4.50     | %      |   | **3.50** | **%**                                        |   | 3.90 | % |   | **4.50** | **%** |   | 4.50 | % |

***Plan        Assets***

|                                |   | **Pension                  Benefits** |
|-------------------------------------|--------|---------------------------------------|
|                                |   | **U.S.                  Plans**       |   | **Non                  U.S. Plans** |
|                                |   | **2006**                              |   | 2005 |   | **2006** |   | 2005 |
| Equity                  securities* |   |                                  | **66** | **%** |   |   | 66 | % |   |   | **65** | **%** |   |   | 69 | % |
| Debt                  securities*   |   |                                  | **33** |   |   |   | 33 |   |   |   | **34** |   |   |   | 31 |   |
| Other                               |   |                                  | **1** |   |   |   | 1 |   |   |   | **1** |   |   |   | — |   |
| Total                               |   |                                  | **100** | **%** |   |   | 100 | % |   |   | **100** | **%** |   |   | 100 | % |

----

|                                            |   |                                  |     |                                     |   |     |   |     |   |     |   |      |   | **Postretirement                  Benefits** |   |
|-------------------------------------------------|--------|---------------------------------------|----------|------------------------------------------|--------|----------|--------|----------|--------|----------|--------|-----------|--------|----------------------------------------------|--------|
|                                            |   | **Pension                  Benefits** |     | **Other                  Than Pensions** |   |
|                                            |   | **U.S.                  Plans**       |     | **Non                  U.S. Plans**      |   |     |   |     |   |     |   |
| ***(dollars                  in millions)***    |   | **2006**                              |     | **2005**                                 |   | **2004** |   | **2006** |   | **2005** |   | **2004**  |   | **2006**                                     |   | **2005** |   | **2004** |   |
| Service                  cost                   |   | **$**                                 | **0.2**  |                                     | $      | 0.5      |   | $        | 0.5    |     | **$**  | **7.2**   |   | $                                            | 5.7    |   | $ | 5.1 |   | **$** | **—** |   | $ | — |   | $ | — |   |
|                                            |   |                                  |     |                                     |   |     |   |     |   |     |   |      |   |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                  cost                  |   |                                  | **3.9**  |                                     |   | 3.8      |   |     | 3.9    |     |   | **21.6**  |   |                                         | 19.2   |   |   | 17.3 |   |   | **0.8** |   |   | 0.9 |   |   | 1.0 |   |
| Expected                  return on plan assets |   |                                  | **(4.5** | **)**                                    |   | (4.9     | )      |     | (5.2   | )        |   | **(20.9** | **)**  |                                         | (19.9  | ) |   | (19.1 | ) |   | **—** |   |   | — |   |   | **—** |   |
| Recognized                  actuarial loss      |   |                                  | **1.7**  |                                     |   | 2.2      |   |     | 1.6    |     |   | **10.4**  |   |                                         | 5.7    |   |   | 3.5 |   |   | **0.3** |   |   | 0.4 |   |   | 0.3 |   |
|  Net                  expense              |   | **$**                                 | **1.3**  |                                     | $      | 1.6      |   | $        | 0.8    |     | **$**  | **18.3**  |   | $                                            | 10.7   |   | $ | 6.8 |   | **$** | **1.1** |   | $ | 1.3 |   | $ | 1.3 |   |
| Discount                  rate                  |   |                                  | **5.50** | **%**                                    |   | 5.88     | %      |     | 6.13   | %        |   | **5.00**  | **%**  |                                         | 5.60   | % |   | 5.50 | % |   | **5.50** | **%** |   | 5.88 | % |   | 6.13 | % |
| Expected                  return on plan assets |   |                                  | **8.00** | **%**                                    |   | 8.25     | %      |     | 8.25   | %        |   | **6.90**  | **%**  |                                         | 7.40   | % |   | 7.40 | % |   | **N/A** |   |   | N/A |   |   | N/A |   |
| Rate                  of compensation increase  |   |                                  | **4.50** | **%**                                    |   | 4.50     | %      |     | 4.50   | %        |   | **3.90**  | **%**  |                                         | 3.90   | % |   | 3.50 | % |   | **4.50** | **%** |   | 4.50 | % |   | 4.50 | % |

***Component        of Comprehensive Income***

|                                                                                                                                             |   | **Pension                  Benefits** |     |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|----------|
| (***in                  millions***)                                                                                                             |   | **2006**                              |     | **2005** |   | **2004** |   |
| Decrease                  (increase) in pension liability included in other comprehensive                  income,                  net of taxes |   | **$**                                 | **27.1** |   | $ | (3.1 | ) | $ | 0.3 |   |
|                                                                                                                                             |   |                                  |     |   |   |   |   |   |   |   |

----

***Future        Benefit Payments***

|                                               |  **Pension                  Plans** |      | **Other****Benefits**                  |
|----------------------------------------------------|------------------------------------------|-----------|----------------------------------------|
|  **(*****in                  millions*****)** |  **U.S.                  Plans**    |      | **Non****U.S.                  Plans** |   |   |
| 2007                                               | $                                   |  4.6 |                                   |   | $  | 15.1 |   |   | $ | 2.0 |   |
| 2008                                               |                                     | 4.7       |                                   |   |   | 15.7 |   |   |   | 1.9 |   |
| 2009                                               |                                     | 4.6       |                                   |   |   | 16.8 |   |   |   | 1.9 |   |
| 2010                                               |                                     | 4.5       |                                   |   |   | 16.9 |   |   |   | 1.8 |   |
| 2011                                               |                                     | 4.6       |                                   |   |   | 17.4 |   |   |   | 1.8 |   |
| Years                  2012-2016                   |                                     | 23.9      |                                   |   |   | 30.4 |   |   |   | 7.7 |   |

***Assumed        Healthcare Cost Trend Rates***

|                                                                                                                                 |   | **2006** |   | **2005** |   |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|----------|--------|----------|--------|
| Healthcare                  cost trend rate assumed for next year                                                                    |   |     | 9      | %        |   | 8 | % |
| Rate                  to which the cost trend rate is assumed to decline (the ultimate                  trend                  rate) |   |     | 5      | %        |   | 5 | % |
| Year                  that the rate reaches the ultimate trend rate                                                                  |   |     | 2011   |     |   | 2010 |   |

|   (***in                    millions***)              | **One****Percent****Increase** |    | **One****Percent****Decrease** |
|-----------------------------------------------------------------|--------------------------------|---------|--------------------------------|
| Effect                    on total of service and interest cost | $                              | — |                           | $ | — |
| Effect                    on postretirement benefit obligation  | $                              | 0.5     |                           | $ | (0.2) |

***Defined        Contribution Plans***

| **12  ** | **Stockholders’                Equity** |
|--------------------|-----------------------------------------------|

----

***Shareholder        Rights Plan***

***Earnings        Per Share (“EPS”)***

| **13  ** | **Stock                Option and Award Plans** |
|--------------------|-------------------------------------------------|

***Stock        Options***

|                                                                    |   | **2006** |     | 2005   |   | 2004 |   |
|-------------------------------------------------------------------------|--------|----------|----------|--------|--------|------|--------|
| Weighted-average                    fair value of options at grant date |   | **$**    | **4.85** |   | $      | 6.51 |   | $ | 8.66 |   |
| Dividend                    yield                                       |   |     | **6.0**  | **%**  |   | 4.1  | %      |   | 3.5 | % |
| Risk-free                    interest rates                             |   |     | **4.7**  | **%**  |   | 4.1  | %      |   | 3.5 | % |
| Volatility                                                              |   |     | **57.4** | **%**  |   | 44.6 | %      |   | 45.4 | % |
| Expected                    option term (years)                         |   |     | **5.8**  |   |   | 5.0  |   |   | 5.0 |   |

----

|                                           |   | **Number                  of****Stock****Options** |      | **Weighted-****Average****Exercise****Price** |   | **Weighted-Average                  Remaining Contractual Term (Years)** |   | **Aggregate                  Intrinsic Value** |   |
|------------------------------------------------|--------|----------------------------------------------------|-----------|-----------------------------------------------|--------|--------------------------------------------------------------------------|--------|------------------------------------------------|--------|
| Outstanding                  January 1, 2006   |   |                                               | 1,474,545 |                                          | $      | 27.40                                                                    |   |                                           | 4.8    |   |   |   |   |
| Granted                                        |   |                                               | 80,300    |                                          |   | 14.60                                                                    |   |                                           | 10.0   |   |   |   |   |
| Exercised                                      |   |                                               | -         |                                          |   | -                                                                        |   |                                           | -      |   |   |   |   |
| Forfeited/expired                              |   |                                               | (155,272  | )                                             |   | 25.02                                                                    |   |                                           | -      |   |   |   |   |
|                                           |   |                                               |           |                                          |   |                                                                     |   |                                           |   |   |   |   |   |
| Outstanding                  December 31, 2006 |   |                                               | 1,399,573 |                                          |   | 26.93                                                                    |   |                                           | 3.8    |   | $ | 190,938 |   |
|                                           |   |                                               |           |                                          |   |                                                                          |   |                                           |        |   |   |  |   |
| Exercisable                  December 31, 2006 |   |                                               | 1,258,422 |                                          |   | 27.88                                                                    |   |                                           | 3.3    |   |   | - |   |
|                                           |   |                                               |           |                                          |   |                                                                          |   |                                           |        |   |   |  |   |

|                                          |   | **Options                  Outstanding**  |      | **Options                  Exercisable**                                                           |   |
|-----------------------------------------------|--------|------------------------------------------------|-----------|---------------------------------------------------------------------------------------------------------|--------|
| **Range                  of Exercise Prices** |   | **Number****Outstanding**                 |      | **Weighted                  -****Average****Remaining****Contractual****Life                  (Years)** |   | **Weighted -****Average****Exercise Price**  |   | **Number****Exercisable**  |   | **Weighted -****Average****Exercise Price**  |   |
|                                          |   |                                           |      |                                                                                                    |   |   |   |   |   |   |   |
| $14.60                  - $19.22              |   |                                           | 160,336   |                                                                                                    |   | 7.5 |   | $ | 16.24 |   |   | 80,136 |   | $ | 17.87 |   |
| $19.23                  - $23.07              |   |                                           | 223,618   |                                                                                                    |   | 5.1 |   | $ | 21.93 |   |   | 185,003 |   | $ | 21.96 |   |
| $23.08                  - $26.91              |   |                                           | 149,257   |                                                                                                    |   | 5.3 |   | $ | 25.48 |   |   | 126,921 |   | $ | 25.34 |   |
| $26.92                  - $30.76              |   |                                           | 630,667   |                                                                                                    |   | 3.0 |   | $ | 28.58 |   |   | 630,667 |   | $ | 28.58 |   |
| $30.77                  - $34.60              |   |                                           | 122,442   |                                                                                                    |   | 0.7 |   | $ | 33.01 |   |   | 122,442 |   | $ | 33.01 |   |
| $34.61                  - $38.45              |   |                                           | 113,253   |                                                                                                    |   | 1.6 |   | $ | 37.97 |   |   | 113,253 |   | $ | 37.97 |   |
|                                          |   |                                           | 1,399,573 |                                                                                                    |   |   |   |   |   |   |   | 1,258,422 |   |   |   |   |

----

| (***in                  millions, except per share data***)                                                                                | **2005** |          | **2004** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------|----------|---------------|----------|--------|
| Stock-based                  compensation expense, net of tax, included in net (loss) income                  as                  reported | **$**    | ** 0.1** |     |   | $ |  0.5 |   |   |
| Net                  (loss) income as reported                                                                                             |     | **(314.3**    | **)**    |   |   | 11.7 |   |   |
| Pro                  forma stock-based compensation expense, net of tax                                                                    |     | **0.6**       |     |   |   | 0.9 |   |   |
| Pro                  forma net (loss) income                                                                                               |     | **(314.9**    | **)**    |   |   | 10.8 |   |   |
| (Loss)                  earnings per share                                                                                                 |     |          |     |   |   |   |   |   |
| As                  reported:                                                                                                              |     |          |     |   |   |   |   |   |
| Basic                                                                                                                                      | **$**    | **(16.20**    | **)**    |   | $ | 0.63 |   |   |
| Diluted                                                                                                                                    |     | **(16.20**    | **)**    |   |   | 0.63 |   |   |
| Pro                  forma:                                                                                                                |     |          |     |   |   |   |   |   |
| Basic                                                                                                                                      | **$**    | **(16.23**    | **)**    |   | $ | 0.58 |   |   |
| Diluted                                                                                                                                    |     | **(16.23**    | **)**    |   |   | 0.58 |   |   |

***Non-employee        Directors***

***Restricted        Stock***

|                                                     |   | **Shares** |    | **Weighted-Average                  Grant****Date                  Value** |   |
|----------------------------------------------------------|--------|------------|---------|----------------------------------------------------------------------------|--------|
|                                                     |   |       |    |                                                                       |   |
| Outstanding                  grants at January 1, 2006   |   |       | 245,856 |                                                                       | $      | 24.75 |   |
| New                  shares granted                      |   |       | 186,100 |                                                                       |   | 17.36 |   |
| Shares                  forfeited                        |   |       | (48,806 | )                                                                          |   | 18.86 |   |
| Shares                  vested                           |   |       | (600    | )                                                                          |   | 19.64 |   |
| Outstanding                  grants at December 31, 2006 |   |       | 382,550 |                                                                       | $      | 21.98 |   |

----

***Stock        Purchase Plans***

***Stock-based        Compensation Expense***

| **14  ** | **Supplemental                Balance Sheet and Cash Flow                Information** |
|--------------------|----------------------------------------------------------------------------------------|

*Balance        Sheet Information*

| ***(in                  millions)***                                                             |   | **2006**  |       | **2005**  |   |
|-------------------------------------------------------------------------------------------------------|--------|----------------|------------|----------------|--------|
| Accrued                  expenses:                                                                    |   |           |       |           |   |
| Compensation                  and employee benefits                                                   |   | **$**          | **28.2**   |           | $      | 27.8 |   |
| Short-term                  portion of environmental liability                                        |   |           | **9.9**    |           |   | 13.0 |   |
| Fixed                  asset purchases                                                                |   |           | **12.6**   |           |   | 12.1 |   |
| Restructuring                                                                                         |   |           | **3.0**    |           |   | 6.9 |   |
| Interest                                                                                              |   |           | **5.5**    |           |   | 5.2 |   |
| Accrued                  other taxes                                                                  |   |           | **6.4**    |           |   | 5.1 |   |
| Sales                  rebates                                                                        |   |           | **4.4**    |           |   | 5.0 |   |
| Government                  Grants                                                                    |   |           | **5.5**    |           |   | 4.7 |   |
| Other                                                                                                 |   |           | **8.4**    |           |   | 9.7 |   |
| Total                                                                                                 |   | **$**          | **83.9**   |           | $      | 89.5 |   |
|                                                                                                  |   |           |       |           |   |   |   |
| Accumulated                  other comprehensive (loss) income:                                       |   |           |       |           |   |   |   |
| Foreign                  currency translation                                                         |   | **$**          | **96.2**   |           | $      | 56.0 |   |
| Pension                  and other postretirement benefits adjustments, net of                  taxes |   |           | **(117.9** | **)**          |   | (67.1 | ) |
| Fair                  market value of derivatives, net of tax                                         |   |           | **5.0**    |           |   | 0.2 |   |
| Total                                                                                                 |   | **$**          | **(16.7**  | **)**          | $      | (10.9 | ) |

----

*Cash        Flow Information*

| *(in                  millions)*                                                                                                                                                                                                |   | **2006**  |        | **2005**  |   | **2004**  |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|-------------|----------------|--------|----------------|--------|
|                                                                                                                                                                                                                            |   |           |        |           |   |           |   |
| Cash                  paid for:                                                                                                                                                                                                 |   |           |        |           |   |           |   |
| Interest                  (net of amounts capitalized)                                                                                                                                                                          |   | **$**          | **38.9**    |           | $      | 33.1           |   | $ | 38.1 |   |
| Income                  taxes                                                                                                                                                                                                   |   |           | **4.6**     |           |   | 13.1           |   |   | (13.0 | ) |
| Supplemental                  investing and financing non-cash transactions:Issuance                  of common stock for long-term incentive and employee benefit plans                  (net of                  forfeitures) |   | **$**          | **0.2**     |           | $      | 0.5            |   | $ | 2.6 |   |
| Dividends                  declared not paid                                                                                                                                                                                    |   |           | **4.4**     |           |   | 4.3            |   |   | 4.3 |   |
| Real                  estate transactions (notes received)                                                                                                                                                                      |   |           | **—** |           |   | —        |   |   | 0.3 |   |
| Assets                  obtained by capital lease                                                                                                                                                                               |   |           | **0.2**     |           |   | 6.5            |   |   | 5.7 |   |
| Assets                  financed*                                                                                                                                                                                               |   |           | **12.6**    |           |   | 12.1           |   |   | 8.3 |   |

*****

| **15  ** | **Commitments                and Contingencies** |
|--------------------|--------------------------------------------------|

***Lease        Obligations***

***Environmental        Matters***

----

----

----

**.        **

----

***Legal        and Other Commitments***

***Guarantees        and Indemnifications***

----

| **16  ** | **Business                Segment Information** |
|--------------------|-------------------------------------------------|

*Disclosures        about Segments of an Enterprise and Related Information*

***Financial        Information by Business Segment:***

| ***(in                  millions)***    |   | **2006** |      | **2005** |   | **2004** |   |
|-----------------------------------------|--------|----------|-----------|----------|--------|----------|--------|
| Net                  sales:             |   |     |      |     |   |     |   |
| Paperboard                  Packaging   |   | **$**    | **840.4** |     | $      | 827.4    |   | $ | 830.9 |   |
| Plastic                  Packaging      |   |     | **155.0** |     |   | 181.8    |   |   | 167.0 |   |
| Consolidated                  net sales |   | **$**    | **995.4** |     | $      | 1,009.2  |   | $ | 997.9 |   |

----

| ***(in                  millions)***                                                           |   | **2006** |        | **2005** |   | **2004** |   |
|------------------------------------------------------------------------------------------------|--------|----------|-------------|----------|--------|----------|--------|
| Operating                  income:                                                             |   |     |        |     |   |     |   |
| Paperboard                  Packaging                                                          |   | **$**    | **42.9**    |     | $      | 49.8     |   | $ | 52.7 |   |
| Plastic                  Packaging                                                             |   |     | **17.9**    |     |   | 15.0     |   |   | 21.5 |   |
| Corporate                                                                                      |   |     | **(15.9**   | **)**    |   | (17.1    | )      |   | (15.3 | ) |
| Goodwill                  impairment charge                                                    |   |     | **(14.3**   | **)**    |   | (312.0   | )      |   | — |   |
| Restructuring                  charges, asset impairmentsand                  other exit costs |   |     | **(33.4**   | **)**    |   | (10.7    | )      |   | — |   |
| Gain                  (loss) on divestitures                                                   |   |     | **3.1**     |     |   | (2.8     | )      |   | — |   |
| Consolidated                  operating income (loss)                                          |   | **$**    | **0.3**     |     | $      | (277.8   | )      | $ | 58.9 |   |
| Identifiable                  assets:                                                          |   |     |        |     |   |     |   |   |   |   |
| Paperboard                  Packaging                                                          |   | **$**    | **859.9**   |     | $      | 826.7    |   | $ | 1,273.2 |   |
| Plastic                  Packaging                                                             |   |     | **171.2**   |     |   | 184.2    |   |   | 183.2 |   |
| Corporate                                                                                      |   |     | **83.7**    |     |   | 112.1    |   |   | 100.6 |   |
| Consolidated                  assets                                                           |   | **$**    | **1,114.8** |     | $      | 1,123.0  |   | $ | 1,557.0 |   |
| Capital                  expenditures:                                                         |   |     |        |     |   |     |   |   |   |   |
| Paperboard                  Packaging                                                          |   | **$**    | **28.1**    |     | $      | 29.7     |   | $ | 30.1 |   |
| Plastic                  Packaging                                                             |   |     | **7.7**     |     |   | 8.0      |   |   | 5.2 |   |
| Corporate                                                                                      |   |     | **—** |     |   | 0.6      |   |   | 0.2 |   |
| Consolidated                  capital expenditures                                             |   | **$**    | **35.8**    |     | $      | 38.3     |   | $ | 35.5 |   |
| Depreciation                  and amortization:                                                |   |     |        |     |   |     |   |   |   |   |
| Paperboard                  Packaging                                                          |   | **$**    | **48.4**    |     | $      | 48.4     |   | $ | 48.9 |   |
| Plastic                  Packaging                                                             |   |     | **7.8**     |     |   | 9.6      |   |   | 10.3 |   |
| Corporate                                                                                      |   |     | **0.2**     |     |   | 0.3      |   |   | 0.3 |   |
| Discontinued                  operations                                                       |   |     | **0.2**     |     |   | 0.9      |   |   | 1.5 |   |
| Consolidated                  depreciation and amortization                                    |   | **$**    | **56.6**    |     | $      | 59.2     |   | $ | 61.0 |   |

***Geographic        Information:***

| ***(in                    millions)*** |   |  **2006** |      |  **2005** |   |  **2004** |   |
|----------------------------------------|--------|----------------|-----------|----------------|--------|----------------|--------|
| Net                    sales:          |   |           |      |           |   |           |   |
| United                    Kingdom      |   | **$**          | **498.6** |           | $      | 557.6          |   | $ | 576.0 |   |
| Germany                                |   |           | **127.5** |           |   | 119.6          |   |   | 109.9 |   |
| Ireland                                |   |           | **90.6**  |           |   | 79.8           |   |   | 74.3 |   |
| France                                 |   |           | **82.1**  |           |   | 78.9           |   |   | 70.8 |   |
| U.S.                                   |   |           | **57.3**  |           |   | 26.1           |   |   | 18.5 |   |
| Belgium                                |   |           | **53.1**  |           |   | 61.2           |   |   | 60.7 |   |
| South                    Africa        |   |           | **40.8**  |           |   | 42.8           |   |   | 46.8 |   |
| Other                                  |   |           | **45.4**  |           |   | 43.2           |   |   | 40.9 |   |
| Total                                  |   | **$**          | **995.4** |           | $      | 1,009.2        |   | $ | 997.9 |   |
|                                   |   |           |      |           |   |           |   |   |   |   |
| Long-lived                    assets:  |   |           |      |           |   |           |   |   |   |   |
| United                    Kingdom      |   | **$**          | **172.3** |           | $      | 186.4          |   | $ | 227.8 |   |
| U.S.                                   |   |           | **105.9** |           |   | 133.2          |   |   | 101.2 |   |
| Germany                                |   |           | **65.4**  |           |   | 66.9           |   |   | 77.0 |   |
| Belgium                                |   |           | **27.1**  |           |   | 23.8           |   |   | 27.8 |   |
| Ireland                                |   |           | **25.5**  |           |   | 23.4           |   |   | 28.3 |   |
| France                                 |   |           | **24.9**  |           |   | 24.8           |   |   | 31.4 |   |
| South                    Africa        |   |           | **11.7**  |           |   | 14.4           |   |   | 12.1 |   |
| Other                                  |   |           | **13.7**  |           |   | 16.5           |   |   | 17.8 |   |
| Total                                  |   | **$**          | **446.5** |           | $      | 489.4          |   | $ | 523.4 |   |

----

*** ***
**Recent        Quarterly Results (Unaudited)**

**(in        millions, except per share data)**

|                       |               |       |       |   |                                           |       |                            |   | **Per                  Share**                                             |
|----------------------------|--------------------|------------|------------|--------|------------------------------------------------|------------|---------------------------------|--------|----------------------------------------------------------------------------|
|                       | **Net**            |       | **Gross**  |   | **Income                  from****Continuing** |       |                            |   | **Income                  from****Continuing                  Operations** |   | **Earnings** |   | **Dividends** |
| **Quarter**                | **Sales**          |       | **Profit** |   | **Operations**                                 |       | **Net                  Income** |   | **Basic**                                                                  |   | **Diluted** |   | **Basic** |   | **Diluted** |   | **Declared** |
| **2006**                   |               |       |       |   |                                           |       |                            |   |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **First****(a)**** ** | **$253.2**         |       |       |   | **$                  44.6**                    |       |                            |   | **$(3.8)**                                                                 |   |   |   | **$(4.7)** |   |   |   | **$(0.20)** |   |   |   | **$(0.20)** |   |   |   | **$(0.24)** |   |   |   | **$(0.24)** |   |   |   | **$0.22** |   |
| **Second****(b)**          | **236.3**          |       |       |   | **41.5**                                       |       |                            |   | **(0.7)**                                                                  |   |   |   | **(4.8)** |   |   |   | **(0.04)** |   |   |   | **(0.04)** |   |   |   | **(0.25)** |   |   |   | **(0.25)** |   |   |   | **0.22** |   |
| **Third****(c)**           |               | **247.9**  |       |   |                                           | **42.7**   |                            |   |                                                                       | **5.4** |   |   |   | **4.1** |   |   |   | **0.28** |   |   |   | **0.28** |   |   |   | **0.21** |   |   |   | **0.21** |   |   |   | **-** |   |
| **Fourth****(d)**          |               | **258.0**  |       |   |                                           | **46.5**   |                            |   |                                                                       | **(33.3)** |   |   |   | **(34.2)** |   |   |   | **(1.72)** |   |   |   | **(1.72)** |   |   |   | **(1.76)** |   |   |   | **(1.76)** |   |   |   | **0.44** |   |
| **Year**                   |               | **$995.4** |       |   |                                           | **$175.3** |                            |   |                                                                       | **$(32.4)** |   |   |   | **$(39.6)** |   |   |   | **$(1.67)** |   |   |   | **$(1.67)** |   |   |   | **$(2.04)** |   |   |   | **$(2.04)** |   |   |   | **$0.88** |   |
| 2005                       |               |       |       |   |                                           |       |                            |   |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| First(e)              | $  264.1 |       |       |   | $ 48.3                                    |       |                            |   | $ 3.0                                                                 |   |   |   | $ 2.3 |   |   |   | $ 0.15 |   |   |   | $ 0.15 |   |   |   | $0.12 |   |   |   | $ 0.12 |   |   |   | $0.22 |   |
| Second(f)                  | 251.0              |       |       |   | 47.2                                           |       |                            |   | 2.6                                                                        |   |   |   | (0.8 | ) |   |   | 0.13 |   |   |   | 0.13 |   |   |   | (0.04 | ) |   |   | (0.04 | ) |   |   | 0.22 |   |
| Third(g)                   |               | 244.8      |       |   |                                           | 44.8       |                            |   |                                                                       | 1.8 |   |   |   | 1.2 |   |   |   | 0.09 |   |   |   | 0.09 |   |   |   | 0.06 |   |   |   | 0.06 |   |   |   | 0.22 |   |
| Fourth(h)                  |               | 249.3      |       |   |                                           | 41.1       |                            |   |                                                                       | (314.1 | ) |   |   | (317.0 | ) |   |   | (16.19 | ) |   |   | (16.19 | ) |   |   | (16.34 | ) |   |   | (16.34 | ) |   |   | 0.22 |   |
| Year                       |               | $1,009.2   |       |   |                                           | $181.4     |                            |   |                                                                       | $(306.7 | ) |   |   | $(314.3 | ) |   |   | $(15.81 | ) |   |   | $(15.81 | ) |   |   | $(16.20 | ) |   |   | $(16.20 | ) |   |   | $0.88 |   |
|                       |               |       |       |   |                                           |       |                            |   |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

***Report        of Independent Registered Public Accounting Firm***

*Internal        Control - Integrated Framework*
*Internal        Control - Integrated Framework*

----

| **Item              9.  ** | **Changes                in and Disagreements With Accountants on Accounting and Financial                Disclosure** |
|--------------------------------------|------------------------------------------------------------------------------------------------------------------------|

----

| **Item              9A.  ** | **Controls                and Procedure****s** |
|---------------------------------------|------------------------------------------------|

*Conclusion        Regarding the Effectiveness of Disclosure Controls and        Procedures*

*Management’s        Report on Internal Control over Financial Reporting*

*Internal        Control - Integrated Framework *
*Internal        Control - Integrated Framework,*

*Remediation        of Prior Year Material Weaknesses*

----

*Changes        in Internal Control over Financial Reporting *

| **Item              9B.  ** | ** ****Other                Information** |
|---------------------------------------|------------------------------------------------|

----

**PART        III**
** **
** **

| **Item              10.  ** | **Directors****,                Executive Officers and Corporate                Governance** |
|---------------------------------------|----------------------------------------------------------------------------------------------|
| **Item              11.  ** | **Executive                Compensation** |
|---------------------------------------|-------------------------------------------|
| **Item              12.  ** | **Security                Ownership of Certain Beneficial Owners and Management and Related                Stockholder Matters** |
|---------------------------------------|----------------------------------------------------------------------------------------------------------------------------------|
| **Item              13.  ** | **Certain                Relationships and Related Transactions****,                and Director Independence** |
|---------------------------------------|-----------------------------------------------------------------------------------------------------------------|
| **Item              14.  ** | **Principal                Accountant Fees and Services** |
|---------------------------------------|-----------------------------------------------------------|

----

**PART        IV**
** **
** **

| **Item              15.  ** | **Exhibits                and Financial Statement Schedules**** ** |
|---------------------------------------|-------------------------------------------------------------------------|
| a.   | The                following documents are filed as part of Item 8 of this                report: |
|----------------|---------------------------------------------------------------------------------------------------|
| (i)   | Financial                Statements |
|-----------------|-------------------------------------|
| ·   | Consolidated                Balance Sheets — December 31, 2006 and January 1,                2006; |
|--------------------|----------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Income and Comprehensive Income — Years ended December 31,                2006, January 1, 2006 and January 2,                2005; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Cash Flows — Years ended December 31, 2006, January 1, 2006                and January 2, 2005; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Changes in Stockholders’ Equity — Years ended December 31,                2006, January 1, 2006 and January 2,                2005; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Notes                to Consolidated Financial Statements; |
|--------------------|------------------------------------------------------------|
| ·   | Recent                Quarterly Results; and |
|--------------------|----------------------------------------------|
| ·   | Report                of Independent Registered Public Accounting                Firm |
|--------------------|---------------------------------------------------------------------------------------|
| (ii)   | Financial                Statement Schedules |
|------------------|----------------------------------------------|

|   | b. | Exhibits                  filed or incorporated by reference: |
|--------|----|---------------------------------------------------------------|

----

**SIGNATURES**

|                           |   | CHESAPEAKE                  CORPORATION                                                                            |
|--------------------------------|--------|--------------------------------------------------------------------------------------------------------------------|
|                           |   | (Registrant)                                                                                                       |
|                           |   |                                                                                                               |
| March                  7, 2007 | By     | /s/                  JOEL K. MOSTROM                                                                               |
|                           |   | Joel                  K. Mostrom                                                                                   |
|                           |   | Senior                  Vice President & Chief Financial Officer(Principal                  Financial Officer) |

| By                                           | /s/                  DAVID FELL                                                                                                                                     |   | By                                          | /s/                  JOHN W. ROSENBLUM         |
|----------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|------------------------------------------------|
|                                         | Sir                  David FellDirector                                                                                                                             |   |                                        | Dr.                  John W. RosenblumDirector |
|                                         |                                                                                                                                                                |   |                                        |                                           |
| By                                           | /s/                  BRIAN J. BUCHAN                                                                                                                                |   | By                                          | /s/                  FRANK S. ROYAL            |
| Brian                  J. BuchanDirector     |                                                                                                                                                                |   | Dr.                  Frank S. RoyalDirector |
|                                         |                                                                                                                                                                |   |                                        |                                           |
| By                                           | /s/                  RAFAËL C. DECALUWÉ                                                                                                                   |   | By                                          | /s/                  BEVERLY L. THELANDER      |
|                                         | Rafaël                  C. DecaluwéDirector                                                                                                               |   |                                        | Beverly                  L. ThelanderDirector  |
|                                         |                                                                                                                                                                |   |                                        |                                           |
| By                                           |                                                                                                                                                                |   | By                                          | /s/                  JOSEPH P. VIVIANO         |
| Jeremy                  S. G. FowdenDirector |                                                                                                                                                                |   | Joseph                  P. VivianoDirector  |
|                                         |                                                                                                                                                                |   |                                        |                                           |
| By                                           | /s/                  ANDREW J. KOHUT                                                                                                                                |   | By                                          | /s/                  HARRY H. WARNER           |
|                                         | Andrew                  J. KohutPresident                  & Chief Executive Officerand                  Director(Principal                  Executive Officer) |   |                                        | Harry                  H. WarnerDirector       |
|                                         |                                                                                                                                                                |   |                                        |                                           |
| By                                           | /s/                  HENRI D. PETIT                                                                                                                                 |   |                                        |                                           |
|                                         | Henri                  D. PetitDirector                                                                                                                             |   |                                        |                                           |
|                                         |                                                                                                                                                                |   |                                        |                                           |

----

**EXHIBIT        INDEX**

| 2.1                                                                                                                                                                                                                                                                                                                                                                                                     | Joint                  Venture Agreement, dated as of October 4, 1999, among Georgia-Pacific                  Corporation, Chesapeake Corporation, Wisconsin Tissue Mills Inc.                  and                  Georgia-Pacific Tissue Company, LLC (filed as Exhibit 2.1 to the                  Registrant’s Quarterly Report on Form 10-Q for the quarter ended September                  30, 1999, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1                                                                                                                                                                                                                                                                                                                                                                                                     | Restated                  Articles of Incorporation (filed as Exhibit 3.1 to the Registrant’s Annual                  Report on Form 10-K for the year ended December 30, 2001, and incorporated                  herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 3.2                                                                                                                                                                                                                                                                                                                                                                                                     | Amended                  and Restated Bylaws of Chesapeake Corporation, as adopted February                  13,                  1990, with amendments through March 1, 2006 (filed as Exhibit 3.1                  to the                  Registrant’s Current Report on Form 8-K dated March 1, 2006, and                  incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 4.1                                                                                                                                                                                                                                                                                                                                                                                                     | Amended                  and Restated Rights Agreement, dated as of February 21, 2001, between                  the                  Registrant and Computershare Investor Services, LLC, successor                  to Harris                  Trust and Savings Bank, as rights agent (filed as Exhibit 4.4 to                  the                  Registrant’s Annual Report on Form 10-K for the year ended December 31,                  2000, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4.2                                                                                                                                                                                                                                                                                                                                                                                                     | Second                  Amended and Restated Credit Agreement, dated as of February 23,                  2004                  (amending and restating the Amended and Restated Credit Agreement,                  dated                  as of February 8, 2001, as previously amended), among Chesapeake                  Corporation, Chesapeake U.K. Holdings Limited, Chesapeake UK Acquisitions                  PLC, Boxmore International Limited, and Field Group plc, as the                  Borrowers,                  various financial institutions and other persons from time to time                  parties                  thereto, as the Lenders, Wachovia Bank, National Association, as                  the                  Administrative Agent, Bank of America, N.A. and Citicorp North                  America,                  Inc., as the Syndication Agents, HSBC Bank plc, as the Documentation                  Agent, and Wachovia Capital Markets, LLC, as a Co-Lead Arranger                  and the                  Sole Book Runner, and Banc of America Securities LLC and Citicorp                  North                  America, Inc, as Co-Lead Arrangers (filed as Exhibit 4.1 to the                  Registrant’s Current Report on Form 8-K dated February 23, 2004, and                  incorporated herein by reference)  |
| 4.3                                                                                                                                                                                                                                                                                                                                                                                                     | Indenture,                  dated as of November 19, 2001, between the Registrant and The Bank                  of New                  York, as Trustee (filed as Exhibit 4.1 to Form S-4 Registration                  Statement                  No. 333-75296, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 4.4                                                                                                                                                                                                                                                                                                                                                                                                     | Indenture,                  dated as of December 8, 2004, between the Registrant and Wachovia                  Bank,                  National Association, as Trustee (filed as Exhibit 4.4 to the Registrant’s                  Annual Report on Form 10-K for the year ended January 2, 2005,                  and                  incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.5                                                                                                                                                                                                                                                                                                                                                                                                     | Form                  of the Registrant’s 7% Senior Subordinated Notes due 2014 (filed as                  Exhibit 4.5 to the Registrant’s Annual Report on Form 10-K for the year                  ended January 2, 2005, and incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.6                                                                                                                                                                                                                                                                                                                                                                                                     | Amendment                  No. 2 dated February 23, 2006 to the Second Amended and Restated                  Credit                  Agreement dated February 23, 2004 (filed as exhibit 4.1 to the                  Registrant’s Current Report on Form 8-K dated February 23, 2006 and                  incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| The                  Registrant agrees to furnish to the Securities and Exchange Commission,                  upon request, copies of those agreements defining the rights of                  holders of                  long-term debt of the Registrant and its subsidiaries that are                  not filed                  herewith pursuant to Item 601(b)(4)(iii) of Regulation S-K.  |
| 10.1*                                                                                                                                                                                                                                                                                                                                                                                                   | 1987                  Stock Option Plan (filed as Exhibit A to the Registrant’s definitive Proxy                  Statement for the Annual Meeting of Stockholders held April 22,                  1987, and                  incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 10.2*                                                                                                                                                                                                                                                                                                                                                                                                   | Directors’                  Deferred Compensation Plan (filed as Exhibit VII to the Registrant’s                  Annual Report on Form 10-K for the year ended December 28, 1980,                  and                  incorporated herein by reference)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

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| 10.3*  | Non-Employee                  Director Stock Option Plan (filed as Exhibit 4.1 to Form S-8 Registration                  Statement No. 33-53478, and incorporated herein by reference)                                                                                                                                                               |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.4*  | Executive                  Supplemental Retirement Plan, as amended and restated on February                  27,                  2007, filed herewith                                                                                                                                                                                              |
| 10.5*  | Retirement                  Plan for Outside Directors (filed as Exhibit 10.9 to the Registrant’s                  Annual Report on Form 10-K for the year ended December 31, 1987,                  and                  incorporated herein by reference)                                                                                    |
| 10.6*  | Chesapeake                  Corporation Long-Term Incentive Plan (filed as Exhibit 10.9 to                  the                  Registrant’s Annual Report on Form 10-K for the year ended December 31,                  1989, and incorporated herein by reference)                                                                          |
| 10.7*  | Chesapeake                  Corporation 1993 Incentive Plan (filed as Exhibit 4.1 to Form S-8                  Registration Statement No. 33-67384, and incorporated herein by                  reference)                                                                                                                                           |
| 10.8*  | Chesapeake                  Corporation Directors’ Deferred Compensation Plan (filed as Exhibit 10.1                  to the Registrant’s Current Report on Form 8-K dated March 1, 2006, and                  incorporated herein by reference)                                                                                         |
| 10.9*  | Chesapeake                  Corporation 401(k) Restoration Plan (filed as Exhibit 10.11 to                  the                  Registrant’s Annual Report on Form 10-K for the year ended December 31,                  1996, and incorporated herein by reference)                                                                          |
| 10.10* | Chesapeake                  Corporation 1997 Incentive Plan (filed as exhibit 4.5 to Form S-8                  Registration Statement No. 333-30763, and incorporated herein by                  reference)                                                                                                                                          |
| 10.11* | Amended                  and Restated Executive Employment Agreement with J.P. Causey Jr.,                  dated as                  of April 22, 2003 (filed as Exhibit 10.4 to the Registrant’s Quarterly                  Report on Form 10-Q for the quarter ended June 29, 2003, and incorporated                  herein by reference)  |
| 10.12* | First                  Amendment to Executive Employment Agreement with J.P. Causey Jr.,                  dated as                  of January 3, 2005 (filed as Exhibit 10.7 to the Registrant’s Current                  Report on Form 8-K dated January 3, 2005, and incorporated herein                  by                  reference)   |
| 10.13* | Second                  Amendment to Executive Employment Agreement with J.P. Causey Jr.,                  dated as                  of August 12, 2005 (filed as Exhibit 10.3 to the Registrant’s Quarterly                  Report on Form 10-Q for the quarter ended July 3, 2005, and incorporated                  herein by reference)   |
| 10.14* | Amended                  and Restated Executive Employment Agreement with Andrew J. Kohut,                  dated as                  of April 22, 2003 (filed as Exhibit 10.3 to the Registrant’s Quarterly                  Report on Form 10-Q for the quarter ended June 29, 2003, and incorporated                  herein by reference)  |
| 10.15* | First                  Amendment to Executive Employment Agreement with Andrew J. Kohut,                  dated as                  of January 3, 2005 (filed as Exhibit 10.9 to the Registrant’s Current                  Report on Form 8-K dated January 3, 2005, and incorporated herein                  by                  reference)   |
| 10.16* | Second                  Amendment to Executive Employment Agreement with Andrew J. Kohut,                  dated as                  of August 12, 2005 (filed as Exhibit 10.2 to the Registrant’s Quarterly                  Report on Form 10-Q for the quarter ended July 3, 2005, and incorporated                  herein by reference)   |

| 10.17* | Third                  Amendment to Executive Employment Agreement with Andrew J. Kohut,                  dated as                  of December 13, 2005 (filed as Exhibit 10.4 to the Registrant’s Current                  Report on Form 8-K dated December 12, 2005, and incorporated herein                  by                  reference)  |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.18* | Amendments,                  effective December 31, 2004, to the Chesapeake Corporation 401(k)                  Restoration Plan (filed as Exhibit 10.20 to the Registrant's Current                  Report on Form 8-K dated December 31, 2004, and incorporated herein                  by                  reference)  |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.19* | Written                  Statement of Terms and Conditions of Employment, dated as of October                  24,                  2003, with Neil Rylance, (filed as Exhibit 10.10 to the Registrant’s                  Current Report on Form 8-K dated January 3, 2005, and incorporated                  herein                  by reference)                  |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.20* | First                  Amendment to Written Statement of Terms and Conditions of Employment                  with                  Neil Rylance, dated as of January 3, 2005 (filed as Exhibit 10.11                  to the                  Registrant’s Current Report on Form 8-K dated January 3, 2005, and                  incorporated herein by reference)  |
| 10.21* | Executive                  Employment Agreement, dated as of April 22, 2003, with Joel K.                  Mostrom                  (filed as Exhibit 10.12 to the Registrant’s Current Report on Form 8-K                  dated January 3, 2005, and incorporated herein by reference)                                                                             |
| 10.22* | First                  Amendment to Executive Employment Agreement with Joel K. Mostrom,                  dated as                  of August 12, 2005 (filed as Exhibit 10.13 to the Registrant’s Current                  Report on Form 8-K dated January 3, 2005, and incorporated herein                  by                  reference)                        |
| 10.23* | Second                  Amendment to Executive Employment Agreement with Joel K. Mostrom,                  dated as                  of January 3, 2005 (filed as Exhibit 10.4 to the Registrant’s Quarterly                  Report on Form 10-Q for the quarter ended July 3, 2005, and incorporated                  herein by reference)                         |
| 10.24* | Chesapeake                  Corporation 2005 Incentive Plan (incorporated herein by reference                  from                  Annex I of the Company’s definitive Proxy Statement filed pursuant to                  Section 14(a) of the Exchange Act on March 25, 2005)                                                                                     |
| 10.25* | Named                  Executive Officers’ and Directors’ compensation, filed herewith                                                                                                                                                                                                                                                                         |
| 11.1   | Computation                  of Net Income Per Share of Common Stock, filed herewith                                                                                                                                                                                                                                                                                       |
| 12.1   | Computation                  of Ratio of Earnings to Fixed Charges, filed herewith                                                                                                                                                                                                                                                                                         |
| 21.1   | Subsidiaries,                  filed herewith                                                                                                                                                                                                                                                                                                                              |
| 23.1   | Consent                  of PricewaterhouseCoopers LLP, filed herewith                                                                                                                                                                                                                                                                                                     |
| 31.1   | Certification                  of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,                  filed                  herewith                                                                                                                                                                                                                          |
| 31.2   | Certification                  of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,                  filed                  herewith                                                                                                                                                                                                                          |
| 32.1   | Certifications                  of CEO and CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant                  to                  Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith                                                                                                                                                                  |

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