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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

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

For the quarterly period ended June 28, 2008

or



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

For the transition period from              to



|                       |  |                                                                                                 |  |                                   
|---------------------- |  | ----------------------------------------------------------------------------------------------- |  | ----------------------------------
|Commission File Number |  | Registrant, State of Incorporation, Address of Principal Executive Offices and Telephone Number |  | I.R.S. Employer Identification No.
|333-112055             |  | VISANT HOLDING CORP.                                                                            |  | 90-0207875                        
|                       |  | (Incorporated in Delaware)                                                                      |  |                                   
|                       |  | 357 Main Street Armonk, New York 10504                                                          |  |                                   
|                       |  | Telephone: (914) 595-8200                                                                       |  |                                   
|                       |  |                                                                                                
|333-120386             |  | VISANT CORPORATION                                                                              |  | 90-0207604                        
|                       |  | (Incorporated in Delaware)                                                                      |  |                                   
|                       |  | 357 Main Street Armonk, New York 10504                                                          |  |                                   
|                       |  | Telephone: (914) 595-8200                                                                       |  |                                   

Indicate by check mark whether each 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 requirement for the past
90 days.    Yes  x    No   ̈

Indicate by check mark whether any of the registrants is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated
filer and smaller reporting company in Rule 12b-2 of the Exchange Act.



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

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

As of August 4, 2008, there were 5,979,984 shares of Class A Common Stock, par value $.01 per share, and one share of Class C Common Stock, par value $.01 per share, of Visant Holding Corp. outstanding and 1,000 shares of
common stock, par value $.01 per share, of Visant Corporation outstanding (all of which are beneficially owned by Visant Holding Corp.).

Visant
Corporation meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format specified in General Instruction (H)(2) to Form 10-Q.

FILING FORMAT

This Quarterly Report on Form 10-Q is a combined
report being filed separately by two registrants: Visant Holding Corp. (Holdings) and Visant Corporation, a wholly owned subsidiary of Holdings (Visant). Unless the context indicates otherwise, any reference in this report to
the Company, we, our, us or Holdings refers to Visant Holding Corp., together with Visant Corporation and its consolidated subsidiaries.









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TABLE OF CONTENTS



|                               |  |                                                                                                                    |  |     
|------------------------------ |  | ------------------------------------------------------------------------------------------------------------------ |  | ----
|PART I  FINANCIAL INFORMATION
|                               |  |                                                                                                                   
|                               |  |                                                                                                                    |  | Page
|ITEM 1.                        |  | Financial Statements (Unaudited)                                                                                   |  |     
|                               |  |                                                                                                                   
|                               |  | Visant Holding Corp. and subsidiaries:                                                                             |  |     
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Statements of Operations for the three and six months ended June 28, 2008 and June 30, 2007 |  | 1   
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Balance Sheets as of June 28, 2008 and December 29, 2007                                    |  | 2   
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Statements of Cash Flows for the six months ended June 28, 2008 and June 30, 2007           |  | 3   
|                               |  |                                                                                                                   
|                               |  | Visant Corporation and subsidiaries:                                                                               |  |     
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Statements of Operations for the three and six months ended June 28, 2008 and June 30, 2007 |  | 4   
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Balance Sheets as of June 28, 2008 and December 29, 2007                                    |  | 5   
|                               |  |                                                                                                                   
|                               |  | Condensed Consolidated Statements of Cash Flows for the six months ended June 28, 2008 and June 30, 2007           |  | 6   
|                               |  |                                                                                                                   
|                               |  | Notes to Condensed Consolidated Financial Statements                                                               |  | 7   
|                               |  |                                                                                                                   
|ITEM 2.                        |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                              |  | 31  
|                               |  |                                                                                                                   
|ITEM 3.                        |  | Quantitative and Qualitative Disclosures About Market Risk                                                         |  | 44  
|                               |  |                                                                                                                   
|ITEM 4.                        |  | Controls and Procedures                                                                                            |  | 44  
|                               |  |                                                                                                                   
|ITEM 4T.                       |  | Controls and Procedures                                                                                            |  | 44  
|                              
|PART II  OTHER INFORMATION   
|                               |  |                                                                                                                   
|ITEM 1.                        |  | Legal Proceedings                                                                                                  |  | 45  
|                               |  |                                                                                                                   
|ITEM 1A.                       |  | Risk Factors                                                                                                       |  | 45  
|                               |  |                                                                                                                   
|ITEM 2.                        |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                        |  | 45  
|                               |  |                                                                                                                   
|ITEM 3.                        |  | Defaults Upon Senior Securities                                                                                    |  | 45  
|                               |  |                                                                                                                   
|ITEM 4.                        |  | Submission of Matters to a Vote of Security Holders                                                                |  | 45  
|                               |  |                                                                                                                   
|ITEM 5.                        |  | Other Information                                                                                                  |  | 45  
|                               |  |                                                                                                                   
|ITEM 6.                        |  | Exhibits                                                                                                           |  | 45  
|                               | 
|Signatures                     |  |                                                                                                                   



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##### Table of Contents

PART I. FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

VISANT HOLDING CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS (UNAUDITED)



|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|----------------------------------------------- |  | ------------------ | ------- | ------------ | ---------------- | ------- | ------------ |  | ------------ | ------- |  | - | ------- | -
|                                                |  | Three months ended |         |              | Six months ended |        
|In thousands                                    |  | June 28,2008       |         | June 30,2007 |                  |         | June 28,2008 |  | June 30,2007 |        
|Net sales                                       |  | $                  | 567,634 |              | $                | 501,466 |              |  | $            | 814,674 |  | $ | 757,316 |  
|Cost of products sold                           |  |                    | 251,180 |              |                  | 217,776 |              |  |              | 379,298 |  |   | 345,846 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Gross profit                                    |  |                    | 316,454 |              |                  | 283,690 |              |  |              | 435,376 |  |   | 411,470 |  
|Selling and administrative expenses             |  |                    | 143,203 |              |                  | 129,400 |              |  |              | 248,531 |  |   | 233,142 |  
|Loss on disposal of fixed assets                |  |                    | 22      |              |                  | 229     |              |  |              | 2       |  |   | 620     |  
|Special charges                                 |  |                    | 2,435   |              |                  | (41     | )            |  |              | 3,886   |  |   | (41     | )
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Operating income                                |  |                    | 170,794 |              |                  | 154,102 |              |  |              | 182,957 |  |   | 177,749 |  
|Interest expense, net                           |  |                    | 31,988  |              |                  | 42,694  |              |  |              | 62,261  |  |   | 81,202  |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Income before income taxes                      |  |                    | 138,806 |              |                  | 111,408 |              |  |              | 120,696 |  |   | 96,547  |  
|Provision for income taxes                      |  |                    | 54,162  |              |                  | 41,436  |              |  |              | 47,407  |  |   | 36,187  |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Income from continuing operations               |  |                    | 84,644  |              |                  | 69,972  |              |  |              | 73,289  |  |   | 60,360  |  
|Income from discontinued operations, net of tax |  |                    |        |              |                  | 102,529 |              |  |              |        |  |   | 110,902 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Net income                                      |  | $                  | 84,644  |              | $                | 172,501 |              |  | $            | 73,289  |  | $ | 171,262 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



1



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VISANT HOLDING CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)



|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|-------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | --------- | - | ---------------- | - | --------- | -
|In thousands, except share amounts                                                                                                                 |  | June 28,2008 |           |   | December 29,2007 |  
|ASSETS                                                                                                                                             |  |              |           |   |                  |   |           |  
|Cash and cash equivalents                                                                                                                          |  | $            | 20,092    |   |                  | $ | 59,710    |  
|Accounts receivable, net                                                                                                                           |  |              | 186,778   |   |                  |   | 138,896   |  
|Inventories                                                                                                                                        |  |              | 92,553    |   |                  |   | 103,924   |  
|Salespersons overdrafts, net of allowance of $9,391 and $9,969, respectively                                                                       |  |              | 14,589    |   |                  |   | 28,730    |  
|Prepaid expenses and other current assets                                                                                                          |  |              | 12,276    |   |                  |   | 19,346    |  
|Income tax receivable                                                                                                                              |  |              |          |   |                  |   | 6,959     |  
|Deferred income taxes                                                                                                                              |  |              | 14,766    |   |                  |   | 12,661    |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total current assets                                                                                                                               |  |              | 341,054   |   |                  |   | 370,226   |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Property, plant and equipment                                                                                                                      |  |              | 404,724   |   |                  |   | 355,341   |  
|Less accumulated depreciation                                                                                                                      |  |              | (193,686  | ) |                  |   | (174,230  | )
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Property, plant and equipment, net                                                                                                                 |  |              | 211,038   |   |                  |   | 181,111   |  
|Goodwill                                                                                                                                           |  |              | 1,005,995 |   |                  |   | 935,569   |  
|Intangibles, net                                                                                                                                   |  |              | 625,892   |   |                  |   | 515,343   |  
|Deferred financing costs, net                                                                                                                      |  |              | 28,899    |   |                  |   | 32,666    |  
|Other assets                                                                                                                                       |  |              | 14,291    |   |                  |   | 12,180    |  
|Prepaid pension costs                                                                                                                              |  |              | 64,579    |   |                  |   | 64,579    |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total assets                                                                                                                                       |  | $            | 2,291,748 |   |                  | $ | 2,111,674 |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                               |  |              |           |   |                  |   |           |  
|Book overdrafts                                                                                                                                    |  | $            | 3,194     |   |                  | $ |          |  
|Short-term borrowings                                                                                                                              |  |              | 104,300   |   |                  |   | 714       |  
|Accounts payable                                                                                                                                   |  |              | 62,633    |   |                  |   | 46,735    |  
|Accrued employee compensation and related taxes                                                                                                    |  |              | 40,659    |   |                  |   | 37,245    |  
|Commissions payable                                                                                                                                |  |              | 45,519    |   |                  |   | 23,468    |  
|Customer deposits                                                                                                                                  |  |              | 67,185    |   |                  |   | 184,461   |  
|Income taxes payable                                                                                                                               |  |              | 28,088    |   |                  |   |          |  
|Interest payable                                                                                                                                   |  |              | 12,096    |   |                  |   | 12,273    |  
|Other accrued liabilities                                                                                                                          |  |              | 36,354    |   |                  |   | 30,106    |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total current liabilities                                                                                                                          |  |              | 400,028   |   |                  |   | 335,002   |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Long-term debt                                                                                                                                     |  |              | 1,403,663 |   |                  |   | 1,392,107 |  
|Deferred income taxes                                                                                                                              |  |              | 207,266   |   |                  |   | 177,929   |  
|Pension liabilities, net                                                                                                                           |  |              | 21,954    |   |                  |   | 25,011    |  
|Other noncurrent liabilities                                                                                                                       |  |              | 33,653    |   |                  |   | 29,748    |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total liabilities                                                                                                                                  |  |              | 2,066,564 |   |                  |   | 1,959,797 |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Mezzanine equity                                                                                                                                   |  |              | 9,611     |   |                  |   | 9,768     |  
|                                                                                                                                                   |  |             
|Common stock:                                                                                                                                      |  |              |           |   |                  |   |           |  
|Class A $.01 par value; authorized 7,000,000 shares; issued and outstanding: 5,979,984 and 5,975,618 shares at June 28, 2008 and
December 29, 2007 |  |              |           |   |                  |   |           |  
|Class B $.01 par value; non-voting; authorized 2,724,759 shares; issued and outstanding: none at June 28, 2008 and December 29, 2007               |  |              |           |   |                  |   |           |  
|Class C $.01 par value; authorized 1 share; issued and outstanding: 1 share at June 28, 2008 and December 29, 2007                                 |  |              | 60        |   |                  |   | 60        |  
|Additional paid-in-capital                                                                                                                         |  |              | 175,286   |   |                  |   | 175,894   |  
|Retained earnings (accumulated deficit)                                                                                                            |  |              | 6,275     |   |                  |   | (67,013   | )
|Treasury stock                                                                                                                                     |  |              |          |   |                  |   | (238      | )
|Accumulated other comprehensive income                                                                                                             |  |              | 33,952    |   |                  |   | 33,406    |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total stockholders equity                                                                                                                         |  |              | 215,573   |   |                  |   | 142,109   |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  
|Total liabilities and stockholders equity                                                                                                         |  | $            | 2,291,748 |   |                  | $ | 2,111,674 |  
|                                                                                                                                                   |  |              |           |   |                  |   |           |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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VISANT HOLDING CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)



|                                                                                  |  |                  |          |   |              |   |          |  
|--------------------------------------------------------------------------------- |  | ---------------- | -------- | - | ------------ | - | -------- | -
|                                                                                  |  | Six months ended |         
|In thousands                                                                      |  | June 28,2008     |          |   | June 30,2007 |  
|Net income                                                                        |  | $                | 73,289   |   |              | $ | 171,262  |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                  |          |   |              |   |          |  
|Income from discontinued operations                                               |  |                  |         |   |              |   | (110,902 | )
|Depreciation                                                                      |  |                  | 21,735   |   |              |   | 17,779   |  
|Amortization of intangible assets                                                 |  |                  | 27,677   |   |              |   | 24,058   |  
|Amortization of debt discount, premium and deferred financing costs               |  |                  | 15,316   |   |              |   | 22,931   |  
|Other amortization                                                                |  |                  | 315      |   |              |   | 335      |  
|Deferred income taxes                                                             |  |                  | 5,540    |   |              |   | (12,685  | )
|Loss on sale of assets                                                            |  |                  | 2        |   |              |   | 620      |  
|Stock-based compensation                                                          |  |                  | 282      |   |              |   | 254      |  
|Changes in assets and liabilities:                                                |  |                  |          |   |              |   |          |  
|Accounts receivable                                                               |  |                  | (33,244  | ) |              |   | (4,665   | )
|Inventories                                                                       |  |                  | 15,619   |   |              |   | 28,443   |  
|Salespersons overdrafts                                                           |  |                  | 14,112   |   |              |   | 11,736   |  
|Prepaid expenses and other current assets                                         |  |                  | 8,215    |   |              |   | 7,163    |  
|Accounts payable and accrued expenses                                             |  |                  | 10,889   |   |              |   | (21,391  | )
|Customer deposits                                                                 |  |                  | (117,164 | ) |              |   | (108,116 | )
|Commissions payable                                                               |  |                  | 22,075   |   |              |   | 27,297   |  
|Income taxes payable/ receivable                                                  |  |                  | 35,562   |   |              |   | 47,907   |  
|Interest payable                                                                  |  |                  | (177     | ) |              |   | (997     | )
|Other                                                                             |  |                  | (1,036   | ) |              |   | 2,228    |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by operating activities of continuing operations                |  |                  | 99,007   |   |              |   | 103,257  |  
|Net cash provided by operating activities of discontinued operations              |  |                  |         |   |              |   | 4,588    |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by operating activities                                         |  |                  | 99,007   |   |              |   | 107,845  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Purchases of property, plant and equipment                                        |  |                  | (21,868  | ) |              |   | (36,002  | )
|Proceeds from sale of property and equipment                                      |  |                  | 138      |   |              |   | 1,491    |  
|Acquisition of businesses, net of cash acquired                                   |  |                  | (221,422 | ) |              |   | (51,749  | )
|Other investing activities, net                                                   |  |                  | (481     | ) |              |   | (8       | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash used in investing activities of continuing operations                    |  |                  | (243,633 | ) |              |   | (86,268  | )
|Net cash provided by investing activities of discontinued operations              |  |                  |         |   |              |   | 396,090  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash (used in) provided by investing activities                               |  |                  | (243,633 | ) |              |   | 309,822  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net book overdrafts                                                               |  |                  | 2,253    |   |              |   |         |  
|Short-term borrowings                                                             |  |                  | 103,586  |   |              |   |         |  
|Repurchase of common stock and payments from stock-based awards                   |  |                  | (1,258   | ) |              |   |         |  
|Principal payments on long-term debt                                              |  |                  |         |   |              |   | (400,000 | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by (used in) financing activities                               |  |                  | 104,581  |   |              |   | (400,000 | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Effect of exchange rate changes on cash and cash equivalents                      |  |                  | 427      |   |              |   | 394      |  
|                                                                                  |  |                  |          |   |              |   |          |  
|(Decrease) increase in cash and cash equivalents                                  |  |                  | (39,618  | ) |              |   | 18,061   |  
|Cash and cash equivalents, beginning of period                                    |  |                  | 59,710   |   |              |   | 18,778   |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Cash and cash equivalents, end of period                                          |  | $                | 20,092   |   |              | $ | 36,839   |  
|                                                                                  |  |                  |          |   |              |   |          |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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VISANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)



|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|----------------------------------------------- |  | ------------------ | ------- | ------------ | ---------------- | ------- | ------------ |  | ------------ | ------- |  | - | ------- | -
|                                                |  | Three months ended |         |              | Six months ended |        
|In thousands                                    |  | June 28,2008       |         | June 30,2007 |                  |         | June 28,2008 |  | June 30,2007 |        
|Net sales                                       |  | $                  | 567,634 |              | $                | 501,466 |              |  | $            | 814,674 |  | $ | 757,316 |  
|Cost of products sold                           |  |                    | 251,180 |              |                  | 217,776 |              |  |              | 379,298 |  |   | 345,846 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Gross profit                                    |  |                    | 316,454 |              |                  | 283,690 |              |  |              | 435,376 |  |   | 411,470 |  
|Selling and administrative expenses             |  |                    | 142,960 |              |                  | 129,204 |              |  |              | 248,127 |  |   | 232,761 |  
|Loss on disposal of fixed assets                |  |                    | 22      |              |                  | 229     |              |  |              | 2       |  |   | 620     |  
|Special charges                                 |  |                    | 2,435   |              |                  | (41     | )            |  |              | 3,886   |  |   | (41     | )
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Operating income                                |  |                    | 171,037 |              |                  | 154,298 |              |  |              | 183,361 |  |   | 178,130 |  
|Interest expense, net                           |  |                    | 18,054  |              |                  | 29,333  |              |  |              | 34,495  |  |   | 54,568  |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Income before income taxes                      |  |                    | 152,983 |              |                  | 124,965 |              |  |              | 148,866 |  |   | 123,562 |  
|Provision for income taxes                      |  |                    | 58,758  |              |                  | 46,160  |              |  |              | 57,351  |  |   | 45,866  |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Income from continuing operations               |  |                    | 94,225  |              |                  | 78,805  |              |  |              | 91,515  |  |   | 77,696  |  
|Income from discontinued operations, net of tax |  |                    |        |              |                  | 102,529 |              |  |              |        |  |   | 110,902 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  
|Net income                                      |  | $                  | 94,225  |              | $                | 181,334 |              |  | $            | 91,515  |  | $ | 188,598 |  
|                                                |  |                    |         |              |                  |         |              |  |              |         |  |   |         |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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VISANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)



|                                                                                                                                 |  |              |           |   |                  |   |           |  
|-------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | --------- | - | ---------------- | - | --------- | -
|In thousands, except share amounts                                                                                               |  | June 28,2008 |           |   | December 29,2007 |  
|ASSETS                                                                                                                           |  |              |           |   |                  |   |           |  
|Cash and cash equivalents                                                                                                        |  | $            | 19,662    |   |                  | $ | 59,142    |  
|Accounts receivable, net                                                                                                         |  |              | 186,778   |   |                  |   | 138,896   |  
|Inventories                                                                                                                      |  |              | 92,553    |   |                  |   | 103,924   |  
|Salespersons overdrafts, net of allowance of $9,391 and $9,969, respectively                                                     |  |              | 14,589    |   |                  |   | 28,730    |  
|Prepaid expenses and other current assets                                                                                        |  |              | 12,849    |   |                  |   | 19,420    |  
|Deferred income taxes                                                                                                            |  |              | 14,766    |   |                  |   | 12,661    |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total current assets                                                                                                             |  |              | 341,197   |   |                  |   | 362,773   |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Property, plant and equipment                                                                                                    |  |              | 404,724   |   |                  |   | 355,341   |  
|Less accumulated depreciation                                                                                                    |  |              | (193,686  | ) |                  |   | (174,230  | )
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Property, plant and equipment, net                                                                                               |  |              | 211,038   |   |                  |   | 181,111   |  
|Goodwill                                                                                                                         |  |              | 1,005,995 |   |                  |   | 935,569   |  
|Intangibles, net                                                                                                                 |  |              | 625,892   |   |                  |   | 515,343   |  
|Deferred financing costs, net                                                                                                    |  |              | 18,443    |   |                  |   | 21,272    |  
|Other assets                                                                                                                     |  |              | 14,291    |   |                  |   | 12,180    |  
|Prepaid pension costs                                                                                                            |  |              | 64,579    |   |                  |   | 64,579    |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total assets                                                                                                                     |  | $            | 2,281,435 |   |                  | $ | 2,092,827 |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|                                                                                                                                 |  |             
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                             |  |              |           |   |                  |   |           |  
|Book overdrafts                                                                                                                  |  | $            | 3,194     |   |                  | $ |          |  
|Short-term borrowings                                                                                                            |  |              | 104,300   |   |                  |   | 714       |  
|Accounts payable                                                                                                                 |  |              | 62,633    |   |                  |   | 46,735    |  
|Accrued employee compensation and related taxes                                                                                  |  |              | 40,659    |   |                  |   | 37,245    |  
|Commissions payable                                                                                                              |  |              | 45,519    |   |                  |   | 23,468    |  
|Customer deposits                                                                                                                |  |              | 67,185    |   |                  |   | 184,461   |  
|Income taxes payable                                                                                                             |  |              | 42,309    |   |                  |   | 1,135     |  
|Interest payable                                                                                                                 |  |              | 9,646     |   |                  |   | 9,781     |  
|Other accrued liabilities                                                                                                        |  |              | 36,354    |   |                  |   | 30,106    |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total current liabilities                                                                                                        |  |              | 411,799   |   |                  |   | 333,645   |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Long-term debt                                                                                                                   |  |              | 816,500   |   |                  |   | 816,500   |  
|Deferred income taxes                                                                                                            |  |              | 239,803   |   |                  |   | 206,201   |  
|Pension liabilities, net                                                                                                         |  |              | 21,954    |   |                  |   | 25,011    |  
|Other noncurrent liabilities                                                                                                     |  |              | 33,653    |   |                  |   | 29,748    |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total liabilities                                                                                                                |  |              | 1,523,709 |   |                  |   | 1,411,105 |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Preferred stock $.01 par value; authorized 300,000 shares; none issued and outstanding at June 28, 2008 and December 29,
2007    |  |              |          |   |                  |   |          |  
|Common stock $.01 par value; authorized 1,000 shares; 1,000 shares issued and outstanding at June 28, 2008 and December 29, 2007 |  |              |          |   |                  |   |          |  
|Additional paid-in-capital                                                                                                       |  |              | 613,917   |   |                  |   | 629,973   |  
|Retained earnings                                                                                                                |  |              | 109,857   |   |                  |   | 18,343    |  
|Accumulated other comprehensive income                                                                                           |  |              | 33,952    |   |                  |   | 33,406    |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total stockholders equity                                                                                                       |  |              | 757,726   |   |                  |   | 681,722   |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  
|Total liabilities and stockholders equity                                                                                       |  | $            | 2,281,435 |   |                  | $ | 2,092,827 |  
|                                                                                                                                 |  |              |           |   |                  |   |           |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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##### Table of Contents

VISANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)



|                                                                                  |  |                  |          |   |              |   |          |  
|--------------------------------------------------------------------------------- |  | ---------------- | -------- | - | ------------ | - | -------- | -
|                                                                                  |  | Six months ended |         
|In thousands                                                                      |  | June 28,2008     |          |   | June 30,2007 |  
|Net income                                                                        |  | $                | 91,515   |   |              | $ | 188,598  |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                  |          |   |              |   |          |  
|Income from discontinued operations                                               |  |                  |         |   |              |   | (110,902 | )
|Depreciation                                                                      |  |                  | 21,735   |   |              |   | 17,779   |  
|Amortization of intangible assets                                                 |  |                  | 27,677   |   |              |   | 24,058   |  
|Amortization of debt discount, premium and deferred financing costs               |  |                  | 2,822    |   |              |   | 11,565   |  
|Other amortization                                                                |  |                  | 315      |   |              |   | 335      |  
|Deferred income taxes                                                             |  |                  | 9,805    |   |              |   | (8,892   | )
|Loss on sale of assets                                                            |  |                  | 2        |   |              |   | 620      |  
|Changes in assets and liabilities:                                                |  |                  |          |   |              |   |          |  
|Accounts receivable                                                               |  |                  | (33,244  | ) |              |   | (4,665   | )
|Inventories                                                                       |  |                  | 15,619   |   |              |   | 28,443   |  
|Salespersons overdrafts                                                           |  |                  | 14,112   |   |              |   | 11,736   |  
|Prepaid expenses and other current assets                                         |  |                  | 8,215    |   |              |   | 7,163    |  
|Accounts payable and accrued expenses                                             |  |                  | 10,889   |   |              |   | (21,391  | )
|Customer deposits                                                                 |  |                  | (117,164 | ) |              |   | (108,116 | )
|Commissions payable                                                               |  |                  | 22,075   |   |              |   | 27,297   |  
|Income taxes payable/ receivable                                                  |  |                  | 41,241   |   |              |   | 40,581   |  
|Interest payable                                                                  |  |                  | (135     | ) |              |   | (955     | )
|Other                                                                             |  |                  | (1,535   | ) |              |   | 2,474    |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by operating activities of continuing operations                |  |                  | 113,944  |   |              |   | 105,728  |  
|Net cash provided by operating activities of discontinued operations              |  |                  |         |   |              |   | 4,588    |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by operating activities                                         |  |                  | 113,944  |   |              |   | 110,316  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Purchases of property, plant and equipment                                        |  |                  | (21,868  | ) |              |   | (36,002  | )
|Proceeds from sale of property and equipment                                      |  |                  | 138      |   |              |   | 1,491    |  
|Acquisition of business, net of cash acquired                                     |  |                  | (221,422 | ) |              |   | (51,749  | )
|Other investing activities, net                                                   |  |                  | (481     | ) |              |   | (8       | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash used in investing activities of continuing operations                    |  |                  | (243,633 | ) |              |   | (86,268  | )
|Net cash provided by investing activities of discontinued operations              |  |                  |         |   |              |   | 396,090  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash (used in) provided by investing activities                               |  |                  | (243,633 | ) |              |   | 309,822  |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Net book overdrafts                                                               |  |                  | 2,253    |   |              |   |         |  
|Short-term borrowings                                                             |  |                  | 103,586  |   |              |   |         |  
|Principal payments on long-term debt                                              |  |                  |         |   |              |   | (400,000 | )
|Distribution to stockholder                                                       |  |                  | (16,057  | ) |              |   | (2,552   | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Net cash provided by (used in) financing activities                               |  |                  | 89,782   |   |              |   | (402,552 | )
|                                                                                  |  |                  |          |   |              |   |          |  
|Effect of exchange rate changes on cash and cash equivalents                      |  |                  | 427      |   |              |   | 394      |  
|                                                                                  |  |                  |          |   |              |   |          |  
|(Decrease) increase in cash and cash equivalents                                  |  |                  | (39,480  | ) |              |   | 17,980   |  
|Cash and cash equivalents, beginning of period                                    |  |                  | 59,142   |   |              |   | 18,043   |  
|                                                                                  |  |                  |          |   |              |   |          |  
|Cash and cash equivalents, end of period                                          |  | $                | 19,662   |   |              | $ | 36,023   |  
|                                                                                  |  |                  |          |   |              |   |          |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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##### Table of Contents

VISANT HOLDING CORP.

VISANT CORPORATION

NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Overview and Basis of Presentation

Overview

We are a leading marketing and
publishing services enterprise servicing the school affinity, direct marketing, fragrance and cosmetics sampling, and educational and trade publishing segments. We were formed through the October 2004 consolidation (the
Transactions) of Jostens, Inc. (Jostens), Von Hoffmann Holdings Inc. and its subsidiaries (Von Hoffmann) and AHC I Acquisition Corp. and its subsidiaries, including AKI, Inc. (Arcade). We sell our
products and services to end customers through several different sales channels including independent sales representatives and dedicated sales forces.

Basis of Presentation

The unaudited condensed consolidated financial statements included herein are those of:



| |  |  | Visant Holding Corp. and its wholly-owned subsidiaries (Holdings) which include Visant Corporation (Visant); and
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | Visant and its wholly-owned subsidiaries.
| | - |  | -----------------------------------------

There are no significant differences between the results of operations and financial condition of Visant Corporation and those of Visant Holding Corp., other than interest expense and the related income tax effect of certain indebtedness of
Holdings. Holdings has 10.25% senior discount notes due 2013, which had an accreted value of $237.2 million and $225.6 million as of June 28, 2008 and December 29, 2007, respectively, and $350.0 million principal amount of 8.75% senior
notes due 2013.

All intercompany balances and transactions have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements of Holdings and Visant, and their respective subsidiaries, are presented pursuant
to the rules and regulations of the U.S. Securities and Exchange Commission (the SEC) in accordance with disclosure requirements for the quarterly report on Form 10-Q. In the opinion of management, all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for the full year. These financial
statements should be read in conjunction with the consolidated financial statements and footnotes included in Holdings and Visants Annual Report on Form 10-K for the fiscal year ended December 29, 2007.

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

2. Significant Accounting Policies

Revenue Recognition

The SECs Staff Accounting Bulletin (SAB) SAB No. 104, Revenue Recognition(SAB No. 104), provides guidance
on the application of accounting principles generally accepted in the United States to selected revenue recognition issues. In accordance with SAB No. 104, the Company recognizes revenue when the earnings process is complete, evidenced by an
agreement between the Company and the customer, delivery and acceptance has occurred, collectibility is probable and pricing is fixed or determinable. Revenue is recognized when (1) products are shipped (if shipped FOB shipping point),
(2) products are delivered (if shipped FOB destination) or (3) as services are performed as determined by contractual agreement, but in all cases only when risk of loss has transferred to the customer and the Company has no further
performance obligations.



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Cost of Products Sold

Cost of products sold primarily include the cost of paper and other materials, direct and indirect labor and related benefit costs, depreciation of production assets and shipping and handling costs.

Shipping and Handling

Net sales include
amounts billed to customers for shipping and handling costs. Costs incurred for shipping and handling are recorded in cost of products sold.

Selling
and Administrative Expenses

Selling and administrative expenses are expensed as incurred. These costs primarily include salaries
and related benefits of sales and administrative personnel, sales commissions, amortization of intangibles and professional fees such as audit and consulting fees.

Advertising

The Company expenses advertising costs as incurred. Selling and administrative expenses includes
advertising expense of $1.6 million and $1.1 million for the quarters ended June 28, 2008 and June 30, 2007, respectively. Advertising expense totaled $3.4 million for the six months ended June 28, 2008 and $3.1 million for the six
months ended June 30, 2007.

Warranty Costs

Provisions for warranty costs related to Jostens scholastic products, particularly class rings due to their lifetime warranty, are recorded based on historical information and current trends in manufacturing
costs. The provision related to the lifetime warranty is based on the number of rings manufactured in the prior school year consistent with industry standards. The total net warranty costs on rings was $1.2 million for each of the quarters ended
June 28, 2008 and June 30, 2007. For the six months ended June 28, 2008 and June 30, 2007, the total net warranty costs were $2.4 million and $2.7 million, respectively. Warranty repair costs for rings manufactured in the current
school year are expensed as incurred. Accrued warranty costs included in the condensed consolidated balance sheets were approximately $0.6 million for both June 28, 2008 and December 29, 2007.

Stock-based Compensation

Effective
January 1, 2006, in accordance with Statement of Financial Accounting Standards (SFAS) SFAS No. 123R (revised 2004), Share-Based Payment (SFAS 123R), the Company recognizes compensation expense related to all
equity awards granted including awards modified, repurchased or cancelled based on the fair values of the awards at the grant date. The Company recognized total compensation expense related to stock options of $0.2 million and $0.1 million for the
three-month periods ended June 28, 2008 and June 30, 2007, respectively, which is included in selling and administrative expenses. Stock-based compensation expense totaled $0.3 million for each of the six-month periods ended June 28,
2008 and June 30, 2007. Refer to Note 15, Stock-based Compensation, for further details.

Mezzanine Equity

The Company has certain management stockholder agreements which contain a repurchase feature whereby Holdings is obligated, under certain circumstances
such as death and disability (as defined in the agreements), to repurchase the common equity from the holder and settle amounts in cash. In accordance with SAB No. 107, Share-Based Payment, such equity instruments are considered
temporary equity and have been classified as mezzanine equity in the balance sheets as of June 28, 2008 and December 29, 2007.

Recent
Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 158, Employers Accounting for Defined Benefit
Pension and Other Postretirement Plans (SFAS No. 158). SFAS No. 158 requires the recognition of the funded status of a benefit plan in the balance sheet; the recognition in other comprehensive income of gains or
losses and prior service costs or credits arising during the period but which are not included as components of periodic benefit cost; the measurement of defined benefit plan



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assets and obligations as of the balance sheet date; and disclosure of additional information about the effects on periodic benefit cost for the following
fiscal year arising from delayed recognition in the current period. In addition, SFAS No. 158 amends SFAS No. 87, Employers Accounting for Pensions, and SFAS No. 106, Employers Accounting for Postretirement
Benefits Other Than Pensions, to include guidance regarding selection of assumed discount rates for use in measuring the benefit obligation. The requirement to recognize the funded status of a benefit plan and the disclosure requirements are
effective as of the end of the fiscal year ending after December 15, 2007. The Company adopted the balance sheet recognition provisions of SFAS 158 as of December 29, 2007, which resulted in an increase to prepaid pension assets of $64.6
million, an increase to total liabilities of $32.2 million and an increase to stockholders equity of $32.4 million, net of taxes. SFAS No. 158 also requires plan assets and benefit obligations to be measured as of the balance sheet
of the Companys fiscal year-end. The Company has historically used a September 30 measurement date. The change in measurement date provision of SFAS No. 158 is effective for Visants fiscal year
2008, and as a result, the Company will adopt this change in measurement date by adjusting ending retained earnings. The Company does not expect the impact of adopting the measurement date provision of SFAS No. 158
to be material to the financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements
(SFAS No. 157), which establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. SFAS No. 157 requires companies to disclose the fair value of their financial instruments
according to a fair value hierarchy as defined in the standard. SFAS No. 157 became effective as of the beginning of the Companys 2008 fiscal year. In February 2008, the FASB issued Staff Positions No. 157-1 and No. 157-2, which
remove certain leasing transactions from SFAS No. 157s scope and partially defer the effective date of SFAS 157 for one year for certain nonfinancial assets and liabilities. The Company adopted SFAS No. 157 as of the beginning of
fiscal year 2008, with the exception of the application of SFAS No. 157 to non-recurring nonfinancial assets and nonfinancial liabilities. The Company does not have financial assets or financial liabilities that are currently measured and
reported on the balance sheet on a fair value basis.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for
Financial Assets and Financial Liabilities (SFAS No. 159). SFAS No. 159 permits entities to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair
value option has been elected are reported in earnings. SFAS No. 159 became effective as of the beginning of the Companys 2008 fiscal year. The Company has adopted SFAS 159 and has elected not to apply the fair value option to any
financial instruments.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations(SFAS
No. 141(R)),which changes how business acquisitions are accounted. SFAS No. 141(R) requires the acquiring entity in a business combination to recognize all (and only) the assets acquired and liabilities assumed in the
transaction and establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed in a business combination. Certain provisions of this standard will, among other things: impact the
determination of acquisition-date fair value of consideration paid in a business combination (including contingent consideration); exclude transaction costs from acquisition accounting; and change accounting practices for acquired contingencies,
acquisition-related restructuring costs, in-process research and development, indemnification assets and tax benefits. SFAS No. 141(R) is effective for business combinations and adjustments to an acquired entitys deferred tax asset and
liability balances occurring after December 31, 2008. The Company cannot anticipate whether the adoption of SFAS No. 141R will have a material impact to the financial statements as the impact is solely dependent on whether the Company
enters into a business combination after December 31, 2008 and the terms of such a transaction.

In December 2007, the FASB issued
SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements, (SFAS No. 160) an amendment of Accounting Research Bulletin No. 51, which establishes new standards governing the accounting for and
reporting on noncontrolling interests (NCIs) in partially owned consolidated subsidiaries and the loss of control of subsidiaries. Certain provisions of SFAS No. 160 indicate, among other things, that NCIs (previously referred to as
minority interests) be treated as a separate component of equity, not as a liability; that increases and decreases in the parents ownership interest that leave control intact be treated as equity transactions, rather than a step acquisition or
dilution gains or losses; and that losses of a partially owned consolidated subsidiary be allocated to the NCI even when such allocation might result in a deficit balance. SFAS No. 160 also requires changes to certain presentation and
disclosure requirements. SFAS No. 160 is effective beginning January 1, 2009. The Company is currently evaluating the impact and disclosure implications of SFAS No. 160 but does not expect it to have a significant impact, if any, in
the financial statements.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging
Activities, an amendment of FASB Statement No. 133 (SFAS No. 161). This statement is intended to improve transparency in financial reporting by requiring enhanced disclosures of an entitys derivative instruments and
hedging activities and their effects on the entitys financial position, financial performance and cash flows. SFAS No. 161 applies to all derivative instruments



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within the scope of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities(SFAS No. 133) as well as related
hedged items, bifurcated derivatives and nonderivative instruments that are designated and qualify as hedging instruments. Entities with instruments subject to SFAS No. 161 must provide more robust qualitative disclosures and expanded
quantitative disclosures. SFAS No. 161 is effective prospectively for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with an early adoption permitted. The Company is currently evaluating
the disclosure implications of this statement.

In April 2008, the FASB issued FSP No. FAS 142-3, Determination of the Useful
Life of Intangible Assets, which amends the list of factors an entity should consider in developing renewal or extension assumptions used in determining the useful life of recognized intangible assets under SFAS No. 142, Goodwill and
Other Intangible Assets. The new guidance applies to (1) intangible assets that are acquired individually or with a group of other assets and (2) intangible assets acquired in both business combinations and asset acquisitions. Under
FSP No. FAS 142-3, entities estimating the useful life of a recognized intangible asset must consider their historical experience in renewing or extending similar arrangements or, in the absence of historical experience, must consider
assumptions that market participants would use about renewal or extension. This FSP will require certain additional disclosures beginning January 1, 2009 and the application to useful life estimates prospectively for intangible assets acquired
after December 31, 2008. The Company does not expect this standard to have a significant impact, if any, in the financial statements.

3. The
Transactions

On October 4, 2004, an affiliate of Kohlberg Kravis Roberts & Co. L.P. (KKR) and affiliates of
DLJ Merchant Banking Partners completed the Transactions which created a marketing and publishing services enterprise, servicing the school affinity, direct marketing, fragrance and cosmetics sampling and educational publishing segments through the
consolidation of Jostens, Von Hoffmann and Arcade.

Prior to the Transactions, Von Hoffmann and Arcade were each controlled by affiliates
of DLJ Merchant Banking Partners II, L.P. (DLJMBP II), and DLJ Merchant Banking Partners III, L.P. (DLJMBP III) owned approximately 82.5% of Holdings outstanding equity, with the remainder held by other co-investors and
certain members of management. Upon consummation of the Transactions, an affiliate of KKR invested $256.1 million and was issued equity interests representing approximately 49.6% of the voting interest and 45.0% of the economic interest of
Holdings, and affiliates of DLJMBP III held equity interests representing approximately 41.0% of the voting interest and 45.0% of the economic interest of Holdings, with the remainder held by other co-investors and certain members of management.
After giving effect to the issuance of equity to additional members of management, as of June 28, 2008, affiliates of KKR and DLJMBP III (the Sponsors) held approximately 49.0% and 41.0%, respectively, of the voting interest of
Holdings, while each continued to hold approximately 44.6% of the economic interest of Holdings. As of June 28, 2008, the other co-investors held approximately 8.4% of the voting interest and 9.2% of the economic interest of Holdings, and
members of management held approximately 1.6% of the voting interest and approximately 1.6% of the economic interest of Holdings.

4. Restructuring
Activity and Other Special Charges

During the three months ended June 28, 2008, the Company recorded $2.1 million of restructuring
charges. The Marketing and Publishing Services segment recorded charges of $1.2 million related to the closure of the Pennsauken, New Jersey facilities associated with a headcount reduction of approximately 206 employees and $0.3 million related to
other special charges in the Marketing and Publishing Services segment. Additionally, the Scholastic and Memory Book segments recorded charges for severance and related benefits of $0.5 million and $0.4 million, respectively. The associated employee
headcount reductions were 8 and 23, respectively.

Restructuring charges for the six months ended June 28, 2008 included $1.2 million
of costs in the Marketing and Publishing Services segment related to the closure of the Pennsauken, New Jersey facilities, $0.3 million of severance costs reducing headcount by one employee and $0.3 million related to other special charges for the
Marketing and Publishing Services segment. Additionally, the Scholastic segment incurred $0.8 million of charges associated with the closure of Jostens Attleboro, Massachusetts facility, $0.5 million of severance and related benefits
associated with the headcount reductions and $0.4 million of severance and related benefits in connection with the restructuring of its international organization resulting in a total reduction of 29 employees. The Memory Book segment incurred $0.4
million of severance and related benefits costs that reduced headcount by 25 employees.



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Restructuring charges for the second quarter and six months ended June 30, 2007 represent a reversal
of less than $0.1 million for severance and related benefit costs associated with headcount reductions in the Scholastic and Memory Book segments.

Restructuring accruals of $3.0 million and $2.1 million as of June 28, 2008 and December 29, 2007, respectively, are included in other accrued liabilities in the condensed consolidated balance sheets. The accruals include amounts
provided for severance related to reductions in corporate and administrative employees from the Scholastic, Memory Book and the Marketing and Publishing Services segments.

On a cumulative basis through June 28, 2008, the Company incurred $23.0 million of employee severance costs related to initiatives during the period
from 2004 to June 28, 2008, which affected an aggregate of 700 employees. As of June 28, 2008, the Company had paid $20.0 million in cash related to these initiatives.

Changes in the restructuring accruals during the first six months of 2008 were as follows:



|                             |  |                 |       |   |                 |   |        |                 |  |   |       |   |  |   |        |  
|---------------------------- |  | --------------- | ----- | - | --------------- | - | ------ | --------------- |  | - | ----- | - |  | - | ------ | -
|                             |  | 2008Initiatives |       |   | 2007Initiatives |   |        | 2006Initiatives |  |   | Total |  
|Balance at December 29, 2007 |  | $               |      |   |                 | $ | 2,110  |                 |  | $ | 43    |   |  | $ | 2,153  |  
|Restructuring charges        |  |                 | 2,823 |   |                 |   | 758    |                 |  |   | 5     |   |  |   | 3,586  |  
|Severance paid               |  |                 | (504  | ) |                 |   | (2,162 | )               |  |   | (48   | ) |  |   | (2,174 | )
|                             |  |                 |       |   |                 |   |        |                 |  |   |       |   |  |   |        |  
|Balance at June 28, 2008     |  | $               | 2,319 |   |                 | $ | 706    |                 |  | $ |      |   |  | $ | 3,025  |  
|                             |  |                 |       |   |                 |   |        |                 |  |   |       |   |  |   |        |  

The Company expects the majority of the remaining severance related to the 2007 and 2008
initiatives to be paid by the end of 2009.

5. Acquisitions

2008 Acquisition

On April 1, 2008, the Company announced the completion of the
acquisition of Phoenix Color Corp. (Phoenix Color), a book component manufacturer, including cash on hand of $1.3 million and restrictive covenants with certain key Phoenix Color stockholders, for approximately $222.7 million in cash,
subject to adjustment. The acquisition was accomplished through a merger of a wholly owned subsidiary of Visant and Phoenix Color, with Phoenix Color as the surviving entity. The results of the Phoenix Color operations are reported as part of the
Marketing and Publishing Services segment from the acquisition date, and as such, all of its goodwill will be allocated to that segment. None of the goodwill or intangible assets will be amortizable for tax purposes.

The acquisition was accounted for as a purchase in accordance with the provisions of SFAS No. 141, Business Combinations(SFAS
No. 141). The cost of the acquisition was allocated to the tangible and intangible assets acquired and liabilities assumed based upon their relative fair values as of the date of the acquisition.

The allocation of the purchase price for the Phoenix Color acquisition, subject to adjustment, was as follows:



|                              |  |              |         |  
|----------------------------- |  | ------------ | ------- | -
|In thousands                  |  | June 28,2008 |        
|Current assets                |  | $            | 38,087  |  
|Property, plant and equipment |  |              | 29,132  |  
|Intangible assets             |  |              | 138,267 |  
|Goodwill                      |  |              | 70,464  |  
|Long-term assets              |  |              | 892     |  
|Current liabilities           |  |              | (12,027 | )
|Long-term liabilities         |  |              | (42,079 | )
|                              |  |              |         |  
|                              |  | $            | 222,736 |  
|                              |  |              |         |  



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In connection with the purchase accounting related to the acquisition of Phoenix Color, the intangible
assets and goodwill approximated $208.7 million which consisted of:



|                       |  |              |        
|---------------------- |  | ------------ | -------
|In thousands           |  | June 28,2008
|Customer relationships |  | $            | 104,000
|Trademarks             |  |              | 18,000 
|Restrictive covenants  |  |              | 16,267 
|Goodwill               |  |              | 70,464 
|                       |  |              |        
|                       |  | $            | 208,731
|                       |  |              |        

Customer relationships are being amortized over a fifteen-year period. The restrictive covenants
are being amortized over the average life of the respective agreements, of which the average term is three years.

This acquisition is not
material to the Companys operations, financial positions or cash flows.

2007Acquisitions

On March 16, 2007, the Company acquired all of the outstanding capital stock of Neff Holding Company and its wholly owned
subsidiary, Neff Motivation, Inc. (Neff), for approximately $30.5 million in cash, including cash on hand of $3.0 million. Neff is a single source provider of custom award programs and apparel, including chenille letters and letter
jackets, to the scholastic market segment.

On June 14, 2007, the Company acquired all of the outstanding capital stock of Visual
Systems, Inc. (VSI), a supplier in the overhead transparency and book component business. The Company acquired VSI for approximately $25.1 million (including a payment of $1.0 million to be made in 2009). VSI conducts business under the
name of Lehigh Milwaukee.

On October 1, 2007, the Companys wholly owned subsidiary, Memory Book Acquisition LLC, acquired
substantially all of the assets and certain liabilities of Publishing Enterprises, Incorporated (Publishing Enterprises), a producer of school memory books and student planners for $6.8 million.

The acquisitions were accounted for as purchases in accordance with the provisions of SFAS No. 141. The costs of the acquisitions were allocated to
the tangible and intangible assets acquired and liabilities assumed based upon their relative fair values as of the date of the acquisition.

The allocation of the aggregate purchase price for the Neff, VSI and Publishing Enterprises acquisitions was as follows:



|                              |  |              |        |  
|----------------------------- |  | ------------ | ------ | -
|In thousands                  |  | June 28,2008 |       
|Current assets                |  | $            | 16,767 |  
|Property, plant and equipment |  |              | 8,997  |  
|Intangible assets             |  |              | 24,450 |  
|Goodwill                      |  |              | 24,142 |  
|Long-term assets              |  |              | 131    |  
|Current liabilities           |  |              | (6,612 | )
|Long-term liabilities         |  |              | (5,672 | )
|                              |  |              |        |  
|                              |  | $            | 62,203 |  
|                              |  |              |        |  



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In connection with the purchase accounting related to the acquisition of Neff, VSI and the Publishing
Enterprises assets, the intangible assets and goodwill approximated $28.0 million and $15.3 million and $5.2 million, respectively, which consisted of:



|                       |  |              |       
|---------------------- |  | ------------ | ------
|In thousands           |  | June 28,2008
|Customer relationships |  | $            | 16,840
|Trademarks             |  |              | 6,300 
|Restrictive covenants  |  |              | 1,310 
|Goodwill               |  |              | 24,142
|                       |  |              |       
|                       |  | $            | 48,592
|                       |  |              |       

Customer relationships are being amortized over a ten-year period. The restrictive covenants are
being amortized over the average life of the respective agreements, of which the average term is two years.

The results of Neffs
operations are reported as part of the Scholastic segment from the acquisition date, and as such, all of its goodwill will be allocated to that segment. None of the goodwill will be amortizable for tax purposes. The results of VSI are included in
the Marketing and Publishing services segment from the acquisition date, and substantially all of the goodwill will be fully amortizable for tax purposes. The results of Memory Book Acquisition LLC, which acquired substantially all of the Publishing
Enterprises assets, are included in the Memory Book segment from the date of acquisition, and substantially all of the goodwill will be fully amortizable for tax purposes.

These acquisitions, both individually and in the aggregate, were not material to the Companys operations, financial positions or cash flows.

6. Discontinued Operations

In May
2007, the Company completed the sale of its Von Hoffmann Holdings Inc., Von Hoffmann Corporation and Anthology, Inc. businesses (the Von Hoffmann businesses), recognizing net proceeds of $401.8 million and a gain on sale of $98.4
million. The Von Hoffmann businesses previously comprised the Educational Textbook segment and a portion of the Marketing and Publishing Services segment. The results of the Von Hoffmann businesses have been reported on the condensed consolidated
statement of operations in the caption titled Income from discontinued operations, net of tax. Previously, the results of these businesses included certain allocated corporate costs, which have been reallocated to the remaining
continuing operations.

During the second quarter of 2007, net operating income from discontinued operations related to operations of Von
Hoffmann business of income of $3.7 million and $0.4 million for the Jostens Photography business, which was sold in second quarter of 2006.



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During the six-months ended June 30, 2007, the Company had income from discontinued operations, net
of tax, from the Von Hoffmann business of $11.1 million, $0.4 million, net of tax, from the Jostens Photography business, which was sold in the second quarter of 2006 and $1.0 million, net of tax, from the Jostens Recognition business, which was
discontinued in 2001. The income in 2007 from the Jostens Recognition business resulted from the reversal of an accrual for potential exposure for which the Company did not believe it was likely to have an ongoing liability.

Included in income from discontinued operations in the condensed consolidated statements of operations are the following:



|                                                  |  |                    |   |                  |   |              |  |              |   |  |   |        
|------------------------------------------------- |  | ------------------ | - | ---------------- | - | ------------ |  | ------------ | - |  | - | -------
|                                                  |  | Three months ended |   | Six months ended
|In thousands                                      |  | June 28,2008       |   | June 30,2007     |   | June 28,2008 |  | June 30,2007
|Net sales from discontinued operations            |  | $                  |  |                  | $ | 37,620       |  | $            |  |  | $ | 109,351
|Pretax income from discontinued operations        |  |                    |  |                  |   | 6,593        |  |              |  |  |   | 20,397 
|Income tax provision from discontinued operations |  |                    |  |                  |   | 2,494        |  |              |  |  |   | 7,925  
|                                                  |  |                    |   |                  |   |              |  |              |   |  |   |        
|Net operating income from discontinued operations |  |                    |  |                  |   | 4,099        |  |              |  |  |   | 12,472 
|Gain on sale of business, net of tax              |  |                    |  |                  |   | 98,430       |  |              |  |  |   | 98,430 
|                                                  |  |                    |   |                  |   |              |  |              |   |  |   |        
|Income from discontinued operations, net of tax   |  | $                  |  |                  | $ | 102,529      |  | $            |  |  | $ | 110,902
|                                                  |  |                    |   |                  |   |              |  |              |   |  |   |        

7. Comprehensive Income

The following amounts were included in determining comprehensive income for Holdings as of the dates indicated:



|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  
|------------------------------------------------------------------------------------ |  | ------------------ | ------ | - | ---------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                                                     |  | Three Months Ended |        |   | Six Months Ended |  
|In thousands                                                                         |  | June 28,2008       |        |   | June 30,2007     |   |         | June 28,2008 |  |   | June 30,2007 |  
|Net income                                                                           |  | $                  | 84,644 |   |                  | $ | 172,501 |              |  | $ | 73,289       |   |  | $ | 171,262 |  
|Change in cumulative translation adjustment                                          |  |                    | (77    | ) |                  |   | (179    | )            |  |   | 785          |   |  |   | (121    | )
|Adjustment for net periodic pension cost and postretirement benefit cost, net of tax |  |                    | (239   | ) |                  |   |        |              |  |   | (239         | ) |  |   |        |  
|Minimum pension liability                                                            |  |                    |       |   |                  |   |        |              |  |   |             |   |  |   | (54     | )
|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  
|Comprehensive income                                                                 |  | $                  | 84,328 |   |                  | $ | 172,322 |              |  | $ | 73,835       |   |  | $ | 171,087 |  
|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  

The following amounts were included in determining comprehensive income for Visant as of the dates
indicated:



|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  
|------------------------------------------------------------------------------------ |  | ------------------ | ------ | - | ---------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                                                     |  | Three Months Ended |        |   | Six Months Ended |  
|In thousands                                                                         |  | June 28,2008       |        |   | June 30,2007     |   |         | June 28,2008 |  |   | June 30,2007 |  
|Net income                                                                           |  | $                  | 94,225 |   |                  | $ | 181,334 |              |  | $ | 91,515       |   |  | $ | 188,598 |  
|Change in cumulative translation adjustment                                          |  |                    | (77    | ) |                  |   | (179    | )            |  |   | 785          |   |  |   | (121    | )
|Adjustment for net periodic pension cost and postretirement benefit cost, net of tax |  |                    | (239   | ) |                  |   |        |              |  |   | (239         | ) |  |   |        |  
|Minimum pension liability                                                            |  |                    |       |   |                  |   |        |              |  |   |             |   |  |   | (54     | )
|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  
|Comprehensive income                                                                 |  | $                  | 93,909 |   |                  | $ | 181,155 |              |  | $ | 92,061       |   |  | $ | 188,423 |  
|                                                                                     |  |                    |        |   |                  |   |         |              |  |   |              |   |  |   |         |  



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8. Accounts Receivable and Inventories

Net accounts receivable were comprised of the following:



|                                |  |              |         |   |                  |   |         |  
|------------------------------- |  | ------------ | ------- | - | ---------------- | - | ------- | -
|In thousands                    |  | June 28,2008 |         |   | December 29,2007 |  
|Trade receivables               |  | $            | 203,076 |   |                  | $ | 149,080 |  
|Allowance for doubtful accounts |  |              | (3,743  | ) |                  |   | (3,304  | )
|Allowance for sales returns     |  |              | (12,555 | ) |                  |   | (6,880  | )
|                                |  |              |         |   |                  |   |         |  
|Accounts receivable, net        |  | $            | 186,778 |   |                  | $ | 138,896 |  
|                                |  |              |         |   |                  |   |         |  

Net inventories were comprised of the following:



|                           |  |              |        |                  |   |        
|-------------------------- |  | ------------ | ------ | ---------------- | - | -------
|In thousands               |  | June 28,2008 |        | December 29,2007
|Raw materials and supplies |  | $            | 40,496 |                  | $ | 28,771 
|Work-in-process            |  |              | 31,348 |                  |   | 37,360 
|Finished goods             |  |              | 20,709 |                  |   | 37,793 
|                           |  |              |        |                  |   |        
|Inventories                |  | $            | 92,553 |                  | $ | 103,924
|                           |  |              |        |                  |   |        

Precious Metals Consignment Arrangement

The Company has a precious metals consignment arrangement with a major financial institution whereby it currently has the ability to obtain up to the
lesser of a certain specified quantity of precious metals and $32.5 million in dollar value in consigned inventory. As required by the terms of this agreement, the Company does not take title to consigned inventory until
payment. Accordingly, the Company does not include the value of consigned inventory or the corresponding liability in its financial statements. The value of consigned inventory at June 28, 2008 and December 29, 2007 was $18.2
million and $26.9 million, respectively. The agreement does not have a stated term, and it can be terminated by either party upon 60 days written notice. Additionally, the Company expensed consignment fees related to this facility of $0.2 million
and $0.1 million for the three months ended June 28, 2008 and June 30, 2007, respectively. The consignment fees expensed for the six months ended June 28, 2008 and June 30, 2007 were $0.4 million and $0.2 million,
respectively. The obligations under the consignment agreement are guaranteed by Visant.

9. Goodwill and Other Intangible Assets

The change in the carrying amount of goodwill is as follows:



|                                     |  |              |           |  
|------------------------------------ |  | ------------ | --------- | -
|In thousands                         |  | June 28,2008 |          
|Balance at beginning of period       |  | $            | 935,569   |  
|Goodwill additions during the period |  |              | 70,497    |  
|Currency translation                 |  |              | (71       | )
|                                     |  |              |           |  
|Balance at end of period             |  | $            | 1,005,995 |  
|                                     |  |              |           |  

Additions to goodwill during the six months ended June 28, 2008 primarily relate to the Phoenix Color
acquisition.



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##### Table of Contents

As of June 28, 2008, goodwill had been allocated to reporting segments as follows:



|                                  |  |              |          
|--------------------------------- |  | ------------ | ---------
|In thousands                      |  | June 28,2008
|Scholastic                        |  | $            | 305,438  
|Memory Book                       |  |              | 391,083  
|Marketing and Publishing Services |  |              | 309,474  
|                                  |  |              |          
|                                  |  | $            | 1,005,995
|                                  |  |              |          

Information regarding other intangible assets is as follows:



|                               |  |                      |  |                     |         |                         |   |          |     |  |                     |         |                         |   |         |     |   |          |   |  |   |        
|------------------------------ |  | -------------------- |  | ------------------- | ------- | ----------------------- | - | -------- | --- |  | ------------------- | ------- | ----------------------- | - | ------- | --- | - | -------- | - |  | - | -------
|                               |  |                      |  | June 28, 2008       |         | December 29, 2007      
|In thousands                   |  | Estimateduseful life |  | Grosscarryingamount |         | Accumulatedamortization |   |          | Net |  | Grosscarryingamount |         | Accumulatedamortization |   |         | Net
|School relationships           |  | 10 years             |  | $                   | 330,000 |                         | $ | (162,471 | )   |  | $                   | 167,529 |                         | $ | 330,000 |     | $ | (146,034 | ) |  | $ | 183,966
|Internally developed software  |  | 2 to 5 years         |  |                     | 10,700  |                         |   | (10,646  | )   |  |                     | 54      |                         |   | 10,700  |     |   | (10,298  | ) |  |   | 402    
|Patented/unpatented technology |  | 3 years              |  |                     | 19,812  |                         |   | (16,318  | )   |  |                     | 3,494   |                         |   | 19,807  |     |   | (15,915  | ) |  |   | 3,892  
|Customer relationships         |  | 4 to 40 years        |  |                     | 159,514 |                         |   | (17,034  | )   |  |                     | 142,480 |                         |   | 55,514  |     |   | (13,100  | ) |  |   | 42,414 
|Other                          |  | 3 to 10 years        |  |                     | 86,288  |                         |   | (42,433  | )   |  |                     | 43,855  |                         |   | 70,090  |     |   | (35,901  | ) |  |   | 34,189 
|                               |  |                      |  |                     |         |                         |   |          |     |  |                     |         |                         |   |         |     |   |          |   |  |   |        
|                               |  |                      |  |                     | 606,314 |                         |   | (248,902 | )   |  |                     | 357,412 |                         |   | 486,111 |     |   | (221,248 | ) |  |   | 264,863
|Trademarks                     |  | Indefinite           |  |                     | 268,480 |                         |   |          |     |  |                     | 268,480 |                         |   | 250,480 |     |   |         |   |  |   | 250,480
|                               |  |                      |  |                     |         |                         |   |          |     |  |                     |         |                         |   |         |     |   |          |   |  |   |        
|                               |  |                      |  | $                   | 874,794 |                         | $ | (248,902 | )   |  | $                   | 625,892 |                         | $ | 736,591 |     | $ | (221,248 | ) |  | $ | 515,343
|                               |  |                      |  |                     |         |                         |   |          |     |  |                     |         |                         |   |         |     |   |          |   |  |   |        

Amortization expense related to other intangible assets was $15.3 million and $12.2 million for
the three months ended June 28, 2008 and June 30, 2007, respectively. For the six months ended June 28, 2008 and June 30, 2007, amortization expense related to other intangible assets was $27.7 million and $24.1 million,
respectively.

Based on intangible assets in service as of June 28, 2008, estimated amortization expense for the remainder of 2008 and
each of the five succeeding fiscal years is $29.2 million, $55.4 million, $52.3 million, $49.6 million, $47.3 million and $31.7 million, respectively.



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##### Table of Contents

10. Debt

Debt consists of the following:



|                                                                                                                                                                                                                                                                    |  |              |           |                  |   |          
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | --------- | ---------------- | - | ---------
|In thousands                                                                                                                                                                                                                                                        |  | June 28,2008 |           | December 29,2007
|Holdings:                                                                                                                                                                                                                                                           |  |              |           |                  |   |          
|Senior discount notes, 10.25% fixed rate, net of discount of $10,037 and $21,593 at June 28, 2008 and December 29, 2007,
respectively, with semi-annual interest accretion through December 1, 2008, thereafter semi-annual and payable at maturity - December 2013 |  | $            | 237,163   |                  | $ | 225,607  
|Senior notes, 8.75% fixed rate, with semi-annual interest payments of $15.3 million, principal due and payable at maturity - December 2013                                                                                                                          |  |              | 350,000   |                  |   | 350,000  
|Visant:                                                                                                                                                                                                                                                             |  |              |           |                  |   |          
|Borrowings under our senior secured credit facility:                                                                                                                                                                                                                |  |              |           |                  |   |          
|Term Loan C, variable rate, 6.72% at June 28, 2008 and 7.19% at December 29, 2007, with semi-annual principal and interest payments
through October 1, 2011                                                                                                         |  |              | 316,500   |                  |   | 316,500  
|Borrowings under our revolving credit facility                                                                                                                                                                                                                      |  |              | 104,300   |                  |   | 714      
|Senior subordinated notes, 7.625% fixed rate, with semi-annual interest payments of $19.1 million, principal due and payable at maturity -
October 2012                                                                                                             |  |              | 500,000   |                  |   | 500,000  
|                                                                                                                                                                                                                                                                    |  |              |           |                  |   |          
|                                                                                                                                                                                                                                                                    |  | $            | 1,507,963 |                  | $ | 1,392,821
|                                                                                                                                                                                                                                                                    |  |              |           |                  |   |          

In connection with the Transactions, Visant entered into senior secured credit facilities,
providing for an aggregate amount of $1,270 million, including a $250 million revolving credit facility, and issued $500 million aggregate principal amount of 7.625% senior subordinated notes. Also in connection with the Transactions,
Jostens, Von Hoffmann and Arcade repaid their existing indebtedness having an aggregate face value of $1,392.6 million, including the redemption value of certain remaining redeemable preferred stock.

Visants obligations under the senior secured credit facilities are unconditionally and irrevocably guaranteed jointly and severally by Visant
Secondary Holdings Corp., a direct wholly-owned subsidiary of Holdings and the parent of Visant, and by Visants material current and future domestic subsidiaries. The obligations of Visants principal Canadian operating subsidiary under
the senior secured credit facilities are unconditionally and irrevocably guaranteed jointly and severally by Visant Secondary Holdings Corp., by Visant, by Visants material current and future domestic subsidiaries and by Visants other
current and future Canadian subsidiaries. Visants obligations under the senior secured credit facilities, and the guarantees of those obligations, are secured by substantially all of Visants assets and substantially all of the assets of
Visant Secondary Holdings Corp. and Visants material current and future domestic subsidiaries, including but not limited to:



| |  |  | all of Visants capital stock and the capital stock of each of Visants existing and future direct and indirect subsidiaries, except that with respect to
foreign subsidiaries such lien and pledge is limited to 65% of the capital stock of first-tier foreign subsidiaries; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | substantially all of Visants material existing and future domestic subsidiaries tangible and intangible assets.
| | - |  | -----------------------------------------------------------------------------------------------------------------

The obligations of Jostens Canada Ltd. under the senior secured credit facilities, and the guarantees of those obligations, are secured by the collateral
referred to in the prior paragraph and substantially all of the tangible and intangible assets of Jostens Canada Ltd. and each of Visants other current and future Canadian subsidiaries.

Amounts borrowed under the term loan facilities that are repaid or prepaid may not be reborrowed. Visants senior secured facilities allow us,
subject to certain conditions, to incur additional term loans under the term loan C facility, or under a new term facility, in either case in an aggregate principal amount of up to $300.0 million. Additionally, restrictions under the Visant senior
subordinated note indenture would limit Visants ability to borrow the full amount of additional term loan borrowings under such a facility. Any additional term loans will have the same security and guarantees as the Term Loan C facility.



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##### Table of Contents

The senior secured credit facilities require Visant to meet a maximum total leverage ratio, a minimum
interest coverage ratio and a maximum capital expenditures limitation. In addition, the senior secured credit facilities contain certain restrictive covenants which will, among other things, limit Visants and its subsidiaries ability to
incur additional indebtedness, pay dividends, prepay subordinated debt, make investments, merge or consolidate, change the business, amend the terms of Visants subordinated debt and engage in certain other activities customarily restricted in
such agreements. It also contains certain customary events of default, subject to grace periods, as appropriate.

The dividend restrictions
under the Visant senior secured credit facilities apply only to Visant and Visant Secondary Holdings Corp., and essentially prohibit all dividends other than (1) for dividends paid on or after April 30, 2009 and used by Holdings to make
regularly-scheduled cash interest payments on its senior discount notes, subject to compliance with the interest coverage covenant after giving effect to such dividends, (2) for other dividends so long as the amount thereof does not exceed $50
million plus an additional amount based on Visants net income and the amount of any capital contributions received by Visant after October 4, 2004 and (3) pursuant to other customary exceptions, including redemptions of stock made
with other, substantially similar stock or with proceeds of concurrent issuances of substantially similar stock.

The indentures governing
Visants senior subordinated notes and Holdings senior discount notes and senior notes also contain numerous covenants including, among other things, restrictions on the ability to: incur or guarantee additional indebtedness or issue
disqualified or preferred stock; pay dividends or make other equity distributions; repurchase or redeem capital stock; make investments or other restricted payments; sell assets or consolidate or merge with or into other companies; create
limitations on the ability of restricted subsidiaries to make dividends or distributions to its parent company; engage in transactions with affiliates; and create liens.

Visants senior subordinated notes are guaranteed, jointly and severally, on a senior subordinated unsecured basis, by each of Visants material current and future domestic subsidiaries. The indenture
governing Visants senior subordinated notes restricts Visant and its restricted subsidiaries from paying dividends or making any other distributions on account of Visants or any restricted subsidiarys equity interests (including
any dividend or distribution payable in connection with any merger or consolidation) other than (1) dividends or distributions by Visant payable in equity interests of Visant or in options, warrants or other rights to purchase equity interests
or (2) dividends or distributions by a restricted subsidiary, subject to certain exceptions.

The indentures governing Holdings
senior discount notes and senior notes restrict Holdings and its restricted subsidiaries from declaring or paying dividends or making any other distribution (including any payment by Holdings or any restricted subsidiary of Holdings in connection
with any merger or consolidation involving Holdings or any of its restricted subsidiaries) on account of Holdings or any of its restricted subsidiaries equity interests (other than dividends or distributions payable in certain equity
interests and dividends payable to Holdings or any restricted subsidiary of Holdings), subject to certain exceptions.

Visants senior
secured credit facilities and the Visant and Holdings notes contain certain cross-default and cross-acceleration provisions whereby a default under or acceleration of other debt obligations would cause a default under or acceleration of the senior
secured credit facilities and the notes.

A failure to comply with the covenants under the senior secured credit facilities, subject to
certain grace periods, would constitute a default under the senior secured credit facilities, which could result in an acceleration of the loans and other obligations owing thereunder. As of June 28, 2008, the Company is not aware of any
material noncompliance with financial covenants.

During the second quarter of 2007, the Company voluntarily prepaid $400.0 million of term
loans under its senior secured credit facilities, including all originally scheduled principal payments due under is term loan C facility for 2007 through mid-2011.

As of June 28, 2008, there was $104.3 million outstanding in the form of short term borrowings under the domestic revolving line of credit under the senior secured credit facilities primarily arising from the
acquisition of Phoenix Color, at a weighted average interest rate of 4.3% and an additional $15.4 million outstanding in the form of letters of credit, leaving $130.3 million available under the Visant $250 million revolving credit facility.



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11. Derivative Financial Instruments and Hedging Activities

The Company may enter into or purchase derivative financial instruments principally to manage interest rate, foreign currency exchange and commodities
exposures. Forward foreign currency exchange contracts may be used to hedge the impact of currency fluctuations primarily on inventory purchases denominated in Euros. At June 28, 2008 and June 30, 2007, there were no contracts related to
these activities outstanding.

12. Commitments and Contingencies

Forward Purchase Contracts

The Company is subject to market risk associated with changes in
the price of precious metals. To mitigate the commodity price risk, the Company may from time to time enter into forward contracts to purchase gold, platinum and silver based upon the estimated ounces needed to satisfy projected customer demand. The
forward purchase contracts are considered normal purchases and therefore not subject to the requirements of SFAS No. 133. The Company did not have any forward contracts at June 28, 2008. As of June 30, 2007, the Company had $13.6
million of purchase commitments with delivery dates occurring throughout 2007.

Environmental

Our operations are subject to a wide variety of federal, state, local and foreign laws and regulations governing emissions to air, discharges to water,
the generation, handling, storage, transportation, treatment and disposal of hazardous substances and other materials, and employee health and safety matters. Compliance with such laws and regulations has been more stringent and, accordingly, more
costly over time. Also, as an owner and operator of real property or a generator of hazardous substances, the Company may be subject to environmental cleanup liability, regardless of fault, pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act or analogous state laws, as well as to claims for harm to health or property or for natural resource damages arising out of contamination or exposure to hazardous substances. Some of our current or past operations have
involved metalworking and plating, printing, and other activities that have resulted in environmental conditions that have given rise to liabilities.

As part of our environmental management program, the Company has been involved in environmental remediation on a property formerly owned and operated by Jostens for jewelry manufacturing. In July 2006, the State of
Illinois Environmental Protection Agency issued a No Further Remediation letter with respect to this site. Although Jostens has certain ongoing monitoring obligations, the Company, however, does not expect the cost of such ongoing
monitoring to be material.

Legal Proceedings

In communications with U.S. Customs and Border Protection (Customs), the Company learned of an alleged inaccuracy of the tariff classification for certain of Jostens imports from Mexico. Jostens
promptly filed with Customs a voluntary disclosure to limit its monetary exposure. The effect of these tariff classification errors is that back duties and fees (or loss of revenue) may be owed on certain imports. Additionally, Customs
may impose interest on the loss of revenue, if any is determined. A review of Jostens import practices has revealed that during the relevant period, the subject merchandise qualified for duty-free tariff treatment under the North American Free
Trade Agreement (NAFTA), in which case there should be no loss of revenue or interest payment owed to Customs. However, Customs allegations indicate that Jostens committed a technical oversight in the classification used by Jostens
in claiming the preferential tariff treatment. Through its prior disclosure to Customs, Jostens addressed this technical oversight and asserted that the merchandise did in fact qualify for duty-free tariff treatment under NAFTA and that there is no
associated loss of revenue. In a series of communications received from Customs in December 2006, Jostens learned that Customs was disputing the validity of Jostens prior disclosure and asserting a loss of revenue in the amount of $2.9 million
for duties owed on entries made in 2002 and 2003 and in a separate pre-penalty notice was advised that Customs is contemplating a monetary penalty in the amount of approximately $5.8 million (two times the alleged loss of revenue). Jostens elected
to continue to address this matter by filing a petition in response to the pre-penalty notice in January 2007, disputing Customs claims and advancing its arguments to support that no loss of revenue or penalty should be issued against the
Company, or in the alternative, that any penalty based on a purely technical violation should be reduced to a nominal fixed amount reflective of the nature of the violation. In May 2007, Customs issued a penalty notice assessing a loss of revenue
(plus interest) and penalty as described above based on asserted negligence by Jostens. In July 2007, Jostens filed a petition in response to the penalty notice



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challenging Customs findings and asserting that there has been no loss of revenue and that no penalty should be issued against Jostens or that, in the
alternative, any penalty should be reduced to a nominal fixed amount reflective of the nature of the violation or mitigated on the basis that the imports at issue are nonetheless duty free. At this stage of the proceedings, the matter is being
evaluated by Customs. In October 2007, based on recent court rulings, Jostens presented additional arguments for Customs consideration supporting that the subject imports at the time of entry were entitled to duty free status. We understand
that the matter is currently under review by Customs. In order to obtain the benefits of the orderly continuation and conclusion of administrative proceedings, in 2006 Jostens agreed to a two-year waiver of the statute of limitations with respect to
the entries made in 2002 and 2003 that otherwise would have expired at the end of 2007 and 2008, respectively. In June 2008, at Customs request, we extended the waiver for one additional year. Jostens intends to continue to vigorously defend
its position and has recorded no accrual for any potential liability pending further communication with Customs. Jostens has the opportunity to extend an offer in compromise to Customs in an effort to settle this matter in advance of a final
administrative decision. If Jostens were to do so, it would be required to tender the amount offered to Customs at the time. It is not clear what Customs final position will be with respect to the alleged tariff classification errors or that
Jostens will not be foreclosed from receiving duty free treatment for the subject imports. Jostens may not be successful in its defense, and the disposition of this matter may have a material effect on our business, financial condition and results
of operations.

The Company is also a party to other litigation arising in the normal course of business. The Company regularly analyzes
current information and, as necessary, provides accruals for probable liabilities on the eventual disposition of these matters. The Company does not believe the effect on our business, financial condition and results of operations, if any, for the
disposition of these matters will be material.

13. Income Taxes

The Company has recorded an income tax provision for the six months ended June 28, 2008 based on its best estimate of the consolidated effective tax rate applicable for the entire year. The estimated full-year
consolidated effective tax rates for 2008 are 39.0% and 38.3% for Holdings and Visant, respectively, before consideration of the effect of $0.3 million of tax and interest accruals for unrecognized tax benefits and other income tax adjustments
considered a period expense or benefit. The combined effect of the annual estimated consolidated tax rates and the net current period tax adjustments resulted in effective tax rates of 39.3% and 38.5% for Holdings and Visant, respectively, for the
six-month period ended June 28, 2008. The annual estimated effective tax rates for fiscal year 2008 increased from annual estimates made in the first quarter of 2008 due to the effect in the current quarter of the acquisition of Phoenix Color.
Deductible transaction costs in connection with the acquisition had an unfavorable effect on the domestic manufacturing deduction. Tax and interest accruals considered a period expense or benefit also unfavorably affected the tax rate.

For the comparable six-month period ended June 30, 2007, the effective rates of income tax expense for Holdings and Visant were 37.5% and 37.1%,
respectively. The effective tax rates for the prior year six-month period were more favorable than the tax rates for the six months ended June 28, 2008 due to more favorable state income tax rates and greater benefit from the domestic
manufacturing deduction.

In connection with the acquisition of Phoenix Color, the Company recorded net deferred tax liabilities of
approximately $21.7 million. As of the April 1, 2008 date of acquisition, the Company estimates that Phoenix Color had federal net operating loss carryforwards of $32.0 million subject to adjustment for unfiled tax returns for 2007 and the 2008
period prior to acquisition. The net operating loss carryforwards expire in periods beginning in 2019.

Effective at the beginning of 2007,
the Company adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), which clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statements in
accordance with SFAS No. 109, Accounting for Income Taxes. FIN 48 requires applying a more likely than not threshold to the recognition and derecognition of tax positions.

During the six months ended June 28, 2008, the Company provided net tax and interest accruals for unrecognized tax benefits of $0.2 million consisting of
$1.3 million of current income tax expense and $1.1 million of deferred income tax benefit. The Companys gross unrecognized tax benefit liability is included in other noncurrent liabilities and at June 28, 2008 totaled $10.3 million, including
interest and penalty accruals of $2.1 million. At December 29, 2007, the Companys unrecognized tax benefit liability totaled $8.8 million, including interest and penalty accruals of $1.7 million. The Companys noncurrent deferred
unrecognized income tax asset is included in noncurrent deferred tax liabilities and totaled $1.6 million at June 28, 2008 and $0.5 million at December 29, 2007.



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The Companys income tax filings for 2004 to 2006 are subject to examination in the U.S. federal tax
jurisdiction. During the quarter ended March 29, 2008, the Internal Revenue Service (IRS) concluded its examination of two pre-acquisition tax filings for one of the Companys subsidiaries for 2004 resulting in only minor
adjustments. The IRS continues its audit of the Companys tax filing for 2005 and has begun to examine the 2006 filing. The Company is also subject to examination in state and certain foreign tax jurisdictions for the 2002 to 2006 periods, none
of which was individually material. The Company has filed appeals for a Canadian federal examination for tax years 1996 and 1997. Though subject to uncertainty, the Company believes it has made appropriate provisions for all outstanding issues for
all open years and in all applicable jurisdictions. During the next twelve months, the Company does not expect that there will be a significant change in the unrecognized tax benefit liability.

14. Pension and Other Postretirement Benefit Plans

Net periodic benefit cost for pension and other postretirement benefit plans is presented below:



|                                          |  |                    |         |   |                         |   |         |              |  |   |              |   |  |   |      |  
|----------------------------------------- |  | ------------------ | ------- | - | ----------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | ---- | -
|                                          |  | Pension benefits   |         |   | Postretirement benefits |  
|                                          |  | Three months ended |         |   | Three months ended      |  
|In thousands                              |  | June 28,2008       |         |   | June 30,2007            |   |         | June 28,2008 |  |   | June 30,2007 |  
|Service cost                              |  | $                  | 1,399   |   |                         | $ | 1,602   |              |  | $ | 3            |   |  | $ | 3    |  
|Interest cost                             |  |                    | 4,124   |   |                         |   | 3,903   |              |  |   | 34           |   |  |   | 38   |  
|Expected return on plan assets            |  |                    | (6,490  | ) |                         |   | (6,044  | )            |  |   |             |   |  |   |     |  
|Amortization of prior year service cost   |  |                    | (186    | ) |                         |   | (199    | )            |  |   | (69          | ) |  |   | (69  | )
|Amortization of net actuarial (gain) loss |  |                    | (6      | ) |                         |   |        |              |  |   | 3            |   |  |   | 9    |  
|                                          |  |                    |         |   |                         |   |         |              |  |   |              |   |  |   |      |  
|Net periodic benefit income               |  | $                  | (1,159  | ) |                         | $ | (738    | )            |  | $ | (29          | ) |  | $ | (19  | )
|                                          |  |                    |         |   |                         |   |         |              |  |   |              |   |  |   |      |  
|                                          |  |                   
|                                          |  | Pension benefits   |         |   | Postretirement benefits |  
|                                          |  | Six months ended   |         |   | Six months ended        |  
|In thousands                              |  | June 28,2008       |         |   | June 30,2007            |   |         | June 28,2008 |  |   | June 30,2007 |  
|Service cost                              |  | $                  | 2,798   |   |                         | $ | 3,204   |              |  | $ | 6            |   |  | $ | 6    |  
|Interest cost                             |  |                    | 8,248   |   |                         |   | 7,806   |              |  |   | 68           |   |  |   | 76   |  
|Expected return on plan assets            |  |                    | (12,980 | ) |                         |   | (12,088 | )            |  |   |             |   |  |   |     |  
|Amortization of prior year service cost   |  |                    | (372    | ) |                         |   | (398    | )            |  |   | (138         | ) |  |   | (138 | )
|Amortization of net actuarial (gain) loss |  |                    | (12     | ) |                         |   |        |              |  |   | 6            |   |  |   | 18   |  
|                                          |  |                    |         |   |                         |   |         |              |  |   |              |   |  |   |      |  
|Net periodic benefit income               |  | $                  | (2,318  | ) |                         | $ | (1,476  | )            |  | $ | (58          | ) |  | $ | (38  | )
|                                          |  |                    |         |   |                         |   |         |              |  |   |              |   |  |   |      |  

As of December 29, 2007, the Company did not expect to have an obligation to contribute to
its qualified pension plans in 2008 due to the funded status of the plans. This estimate has not changed as of June 28, 2008. For the six months ended June 28, 2008, the Company did not make any contributions to its qualified pension plans
and contributed $1.0 million and $0.2 million to its non-qualified pension plans and postretirement welfare plans, respectively. These payments to the non-qualified pension and postretirement welfare plans are consistent with the expected amounts
disclosed as of December 29, 2007.

15. Stock-based Compensation

The 2003 Stock Incentive Plan (the 2003 Plan) was approved by the Board of Directors and effective as of October 30, 2003. The 2003 Plan permits the Company to grant key employees and certain other
persons stock options and stock awards and provides for a total of 288,023 shares of common stock for issuance of options and awards to employees of the Company and a total of 10,000 shares of common stock for issuance of options and awards to
directors and other persons providing



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services to the Company. Pursuant to the 2003 Plan, the maximum grant to any one person shall not exceed in the aggregate 70,400 shares. We do not currently
intend to make any additional grants under the 2003 Plan. Option grants consist of time options, which vest and become exercisable in annual installments over the first five years following the date of grant and/or performance
options, which vest and become exercisable over the first five years following the date of grant at varying levels based on the achievement of certain EBITDA targets, and in any event by the eighth anniversary of the date of grant. The
performance vesting includes certain carryforward provisions if targets are not achieved in a particular fiscal year and performance in a subsequent fiscal year satisfies cumulative performance targets, subject to certain conditions. Upon the
occurrence of a change in control (as defined in the 2003 Plan), the unvested portion of any time option will immediately become vested and exercisable, and the vesting and exercisability of the unvested portion of any performance option
may accelerate depending on the timing of the change of control and return on the equity investment by DLJMBP III in the Company as provided under the 2003 Plan. A change in control under the 2003 Plan is defined as: (i) any person
or other entity (other than any of Holdings subsidiaries), including any person as defined in Section 13(d)(3) of the Exchange Act, other than certain of the DLJMBP Funds or affiliated parties thereof becoming the beneficial
owner, directly or indirectly, in a single transaction or a series of related transactions, by way of merger, consolidation or other business combination, of securities of Holdings representing more than 51% of the total combined voting power of all
classes of capital stock of Holdings (or its successor) normally entitled to vote for the election of directors of Holdings or (ii) the sale of all or substantially all of the property or assets of Holdings to any unaffiliated person or entity
other than one of Holdings subsidiaries is consummated. The Transactions did not constitute a change of control under the 2003 Plan. Options issued under the 2003 Plan expire on the tenth anniversary of the grant date. The shares underlying
the options are subject to certain transfer and other restrictions set forth in that certain Stockholders Agreement dated July 29, 2003, by and among the Company and certain holders of the capital stock of the Company. Participants under the
2003 Plan also agree to certain restrictive covenants with respect to confidential information of the Company and non-competition in connection with their receipt of options.

All outstanding options to purchase Holdings common stock continued following the closing of the Transactions. In connection with the Transactions, all
outstanding options to purchase Von Hoffmann and Arcade common stock were cancelled and extinguished. Consideration paid in respect of the Von Hoffmann options was an amount equal to the difference between the per share merger consideration in the
Transactions and the exercise price therefore. No consideration was paid in respect of the Arcade options.

In connection with the closing
of the Transactions, the Company established the 2004 Stock Option Plan, which permits the Company to grant key employees and certain other persons of the Company and its subsidiaries various equity-based awards, including stock options and
restricted stock. The plan, currently known as the Third Amended and Restated 2004 Stock Option Plan for Key Employees of Visant Holding Corp. and Subsidiaries (the 2004 Plan), provides for issuance of a total of 510,230 shares of
Holdings Class A Common Stock. As of June 28, 2008, there were 76,548 shares available for grant under the 2004 Plan. Shares related to grants that are forfeited, terminated, cancelled or expire unexercised become available for new grants.
Under his employment agreement, Mr. Marc L. Reisch, the Chairman of our Board of Directors and our Chief Executive Officer and President, received awards of stock options and restricted stock under the 2004 Plan. Additional members of
management have also received grants under the 2004 Plan. Option grants consist of time options, which vest and become exercisable in annual installments through 2009, and/or performance options, which vest and become
exercisable following the date of grant based upon the achievement of certain EBITDA and other performance targets, and in any event by the eighth anniversary of the date of grant. The performance vesting includes certain carryforward provisions if
targets are not achieved in a particular fiscal year and performance in a subsequent fiscal year satisfies cumulative performance targets. Upon the occurrence of a change in control (as defined under the 2004 Plan), the unvested portion
of any time option will immediately become vested and exercisable, and the vesting and exercisability of the unvested portion of any performance option may accelerate if certain EBITDA or other performance measures have been satisfied. A
change in control under the 2004 Plan is defined as: (i) the sale (in one or a series of transactions) of all or substantially all of the assets of Holdings to an unaffiliated person; (ii) a sale (in one transaction or a series
of transactions) resulting in more than 50% of the voting stock of Holdings being held by an unaffiliated person; (iii) a merger, consolidation, recapitalization or reorganization of Holdings with or into an unaffiliated person; if and only if
any such event listed in (i) through (iii) above results in the inability of the Sponsors, or any member of members of the Sponsors, to designate or elect a majority of the Board (or the board of directors of the resulting entity or its
parent company). The option exercise period is determined at the time of grant of the option but may not extend beyond the end of the calendar year that is ten calendar years after the date the option is granted. All options, restricted shares and
any common stock for which such equity awards are exercised or with respect to which restrictions lapse are governed by a management stockholders agreement and sale participation agreement. As of June 28, 2008, there were 247,720 options
vested under the 2004 Plan and 68,999 options unvested and subject to vesting.



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Effective January 1, 2006, the Company adopted SFAS No. 123R, which requires the recognition of
compensation expense related to all equity awards based on the fair values of the awards at the grant date. Prior to the adoption of SFAS No. 123R, the Company used the minimum value method in its SFAS No. 123 pro forma disclosure and
therefore applied the prospective transition method as of the effective date. Under the prospective transition method, the Company would recognize compensation expense for equity awards granted, modified and canceled subsequent to the date of
adoption.

On April 4, 2006, the Company declared and paid a special cash dividend of $57.03 per share to the common stockholders of
Holdings. In connection with the special cash dividend, on April 4, 2006, the exercise prices of issued and outstanding options as of April 4, 2006 under the 2003 Plan and the 2004 Plan were reduced by an amount equal to the dividend. The
2003 and 2004 Plans and underlying stock option agreements contain provisions that provide for anti-dilutive protection in the case of certain extraordinary corporate transactions, such as the special dividend, and the incremental compensation cost,
defined as the difference in the fair value of the modified award immediately before and after the modification, was calculated as zero. As a result of the above modification, all stock option awards previously accounted for under APB No. 25
will be prospectively accounted for under SFAS No. 123R. Accordingly, no incremental compensation cost was recognized as a result of the modification.

During the quarter ended June 28, 2008, Holdings issued, subject to vesting, a total of 2,600 restricted shares of Holdings Class A Common Stock to three officers of the Company under the 2004 Plan.

For each of the three-month periods ended June 28, 2008 and June 30, 2007, the Company recognized total compensation expense
related to stock options of approximately $0.2 and $0.1 million, respectively, which is included in selling and administrative expense. Stock-based compensation expense totaled $0.3 million for each of the six-month periods ended June 28, 2008
and June 30, 2007.

For the six-month period ended June 28, 2008, no options were granted or cancelled. An aggregate of 8,430
options were exercised by employees in connection with their separation of service, 1,108 options vested and 14,008 options were forfeited in connection with certain employees separation of service. For the six-month period ended June 30,
2007, no options were exercised, 5,546 options were granted, 2,195 options were cancelled, 1,509 options vested and 3,291 options were forfeited in connection with certain employees separation of service.

The following table summarizes stock option activity for Holdings:



|                                            |  |         |   |  |                                 |      
|------------------------------------------- |  | ------- | - |  | ------------------------------- | -----
|Options in thousands                        |  | Options |   |  | Weighted -averageexercise price
|Outstanding at December 29, 2007            |  | 394     |   |  | $                               | 42.84
|Exercised                                   |  | (8      | ) |  | $                               | 39.07
|Granted                                     |  |        |   |  | $                               |     
|Forfeited                                   |  | (14     | ) |  | $                               | 39.07
|Cancelled                                   |  |        |   |  | $                               |     
|                                            |  |         |   |  |                                 |      
|Outstanding at June 28, 2008                |  | 372     |   |  | $                               | 43.08
|                                            |  |         |   |  |                                 |      
|Vested or expected to vest at June 28, 2008 |  | 372     |   |  | $                               | 43.08
|                                            |  |         |   |  |                                 |      
|Exercisable at June 28, 2008                |  | 302     |   |  | $                               | 40.27
|                                            |  |         |   |  |                                 |      

The exercise prices for options granted prior to April 2006 have been adjusted to reflect the
special dividend of $57.03 declared in April 2006.

The weighted average remaining contractual life of outstanding options at June 28,
2008 was approximately 7.0 years.



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16. Business Segments

Our three reportable segments consist of:



| |  |  | Scholasticprovides services related to the marketing, sale and production of class rings and an array of graduation products and other scholastic
products to students and administrators primarily in high schools, colleges and other post-secondary institutions;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Memory Bookprovides services related to the publication, marketing, sale and production of school yearbooks, memory books and related products that
help people tell their stories and chronicle important events; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Marketing and Publishing Servicesproduces multi-sensory and interactive advertising sampling systems, primarily for the fragrance, cosmetics and
personal care market segments, and provides innovative products and services to the direct marketing sector. The group also produces book components and overhead transparencies.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The following table presents information on Holdings by business segment:



|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|--------------------------------- |  | ------------------ | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                  |  | Three months ended |         |   |              |   |         |          | 
|In thousands                      |  | June 28,2008       |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                         |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 143,625 |   |              | $ | 136,096 |          |  | $ | 7,529    |   |  | 5.5   | % 
|Memory Book                       |  |                    | 283,450 |   |              |   | 264,524 |          |  |   | 18,926   |   |  | 7.2   | % 
|Marketing and Publishing Services |  |                    | 141,039 |   |              |   | 100,962 |          |  |   | 40,077   |   |  | 39.7  | % 
|Inter-segment eliminations        |  |                    | (480    | ) |              |   | (116    | )        |  |   | (364     | ) |  | NM    |   
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                  | 567,634 |   |              | $ | 501,466 |          |  | $ | 66,168   |   |  | 13.2  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 25,195  |   |              | $ | 24,978  |          |  | $ | 217      |   |  | 0.9   | % 
|Memory Book                       |  |                    | 123,452 |   |              |   | 112,067 |          |  |   | 11,385   |   |  | 10.2  | % 
|Marketing and Publishing Services |  |                    | 22,147  |   |              |   | 17,057  |          |  |   | 5,090    |   |  | 29.8  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                  | 170,794 |   |              | $ | 154,102 |          |  | $ | 16,692   |   |  | 10.8  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and Amortization     |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 6,275   |   |              | $ | 6,295   |          |  | $ | (20      | ) |  | (0.3  | )%
|Memory Book                       |  |                    | 9,701   |   |              |   | 9,584   |          |  |   | 117      |   |  | 1.2   | % 
|Marketing and Publishing Services |  |                    | 11,021  |   |              |   | 5,433   |          |  |   | 5,588    |   |  | 102.9 | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                  | 26,997  |   |              | $ | 21,312  |          |  | $ | 5,685    |   |  | 26.7  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful



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##### Table of Contents

|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|--------------------------------- |  | ---------------- | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                  |  | Six months ended |         |   |              |   |         |          | 
|In thousands                      |  | June 28,2008     |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                         |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 282,647 |   |              | $ | 276,401 |          |  | $ | 6,246    |   |  | 2.3   | % 
|Memory Book                       |  |                  | 292,090 |   |              |   | 272,375 |          |  |   | 19,715   |   |  | 7.2   | % 
|Marketing and Publishing Services |  |                  | 240,844 |   |              |   | 209,013 |          |  |   | 31,831   |   |  | 15.2  | % 
|Inter-segment eliminations        |  |                  | (907    | ) |              |   | (473    | )        |  |   | (434     | ) |  | NM    |   
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                | 814,674 |   |              | $ | 757,316 |          |  | $ | 57,358   |   |  | 7.6   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 37,801  |   |              | $ | 47,470  |          |  | $ | (9,669   | ) |  | (20.4 | )%
|Memory Book                       |  |                  | 107,390 |   |              |   | 94,948  |          |  |   | 12,442   |   |  | 13.1  | % 
|Marketing and Publishing Services |  |                  | 37,766  |   |              |   | 35,331  |          |  |   | 2,435    |   |  | 6.9   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                | 182,957 |   |              | $ | 177,749 |          |  | $ | 5,208    |   |  | 2.9   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and Amortization     |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 13,353  |   |              | $ | 13,215  |          |  | $ | 138      |   |  | 1.0   | % 
|Memory Book                       |  |                  | 18,614  |   |              |   | 18,061  |          |  |   | 553      |   |  | 3.1   | % 
|Marketing and Publishing Services |  |                  | 17,760  |   |              |   | 10,896  |          |  |   | 6,864    |   |  | 63.0  | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|                                  |  | $                | 49,727  |   |              | $ | 42,172  |          |  | $ | 7,555    |   |  | 17.9  | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful

17. Related Party Transactions

Management Services Agreement

In connection with the Transactions, we entered into a management services agreement
with the Sponsors pursuant to which the Sponsors provide certain structuring, consulting and management advisory services to us. Under the management services agreement, during the term thereof, the Sponsors receive an annual advisory fee of $3.0
million, that is payable quarterly and which increases by 3% per year. The Company paid $0.9 million and $0.8 million as advisory fees to the Sponsors for the three months ended June 28, 2008 and June 30, 2007, respectively. For the
six months ended June 28, 2008 and June 30, 2007, the Company paid $1.7 million and $1.6 million, respectively, as advisory fees to the Sponsors. The management services agreement also provides that we will indemnify the Sponsors and their
affiliates, directors, officers and representatives for losses relating to the services contemplated by the management services agreement and the engagement of the Sponsors pursuant to, and the performance by the Sponsors of the services
contemplated by, the management services agreement.

Other

We retain Capstone Consulting from time to time to provide certain of our businesses with consulting services primarily to identify and advise on potential opportunities to improve operating efficiencies and other
strategic efforts within the businesses. The company paid $0.1 million for the three months ended June 28, 2008 and $0.3 million for the six months ended June 28, 2008 for services provided by them. There were no services rendered or
payments made for the second quarter and six months ended June 30, 2007. Although neither KKR nor any entity affiliated with KKR owns any of the equity of Capstone Consulting, KKR has provided financing to Capstone Consulting. In
March 2005, an affiliate of Capstone Consulting invested $1.3 million in our parents Class A Common Stock and was granted 13,527 options to purchase our parents Class A Common Stock, with an exercise price of $96.10401 per
share under the 2004 Plan (the exercise price was reduced in connection with the dividend paid by Holdings to its stockholders on April 4, 2006, to $39.07 per share). As of the end of 2007, these options were fully vested and exercisable.



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We are party to an agreement with CoreTrust Purchasing Group (CoreTrust), a group purchasing
organization, pursuant to which we may purchase products and services from certain vendors through CoreTrust on the terms established between CoreTrust and each vendor. An affiliate of KKR is party to an agreement with CoreTrust which permits
certain KKR affiliates, including us, access to CoreTrusts group purchasing program. CoreTrust receives payment of fees for administrative and other services provided by CoreTrust from certain vendors based on products and services purchased
by us and CoreTrust shares a portion of such fees with the KKR affiliate. For the three and six months ended June 28, 2008, we purchased $0.7 million and $1.3 million, respectively, of computer and office supply products through this
arrangement.

18. Condensed Consolidating Guarantor Information

As discussed in Note 10, Debt, Visants obligations under the senior secured credit facilities and the 7.625% senior subordinated notes are guaranteed by certain of its 100% wholly-owned subsidiaries on a
full, unconditional and joint and several basis. The following tables present condensed consolidating financial information for Visant, as issuer, and its guarantor and non-guarantor subsidiaries.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (UNAUDITED)

Three months ended June 28, 2008



|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|------------------------------------------- |  | ------ | ------- | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | ----- | ------- | - |  | - | -------
|In Thousands                                |  | Visant |         |   | Guarantors |   |         | Non-Guarantors |  |   | Eliminations |   |  | Total
|Net sales                                   |  | $      |        |   |            | $ | 553,638 |                |  | $ | 21,009       |   |  | $     | (7,013  | ) |  | $ | 567,634
|Cost of products sold                       |  |        | (4,265  | ) |            |   | 251,372 |                |  |   | 11,354       |   |  |       | (7,281  | ) |  |   | 251,180
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|Gross profit                                |  |        | 4,265   |   |            |   | 302,266 |                |  |   | 9,655        |   |  |       | 268     |   |  |   | 316,454
|Selling and administrative expenses         |  |        | (293    | ) |            |   | 137,758 |                |  |   | 5,495        |   |  |       |        |   |  |   | 142,960
|Loss on disposal of fixed assets            |  |        |        |   |            |   | 22      |                |  |   |             |   |  |       |        |   |  |   | 22     
|Special charges                             |  |        |        |   |            |   | 2,716   |                |  |   | (281         | ) |  |       |        |   |  |   | 2,435  
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|Operating income                            |  |        | 4,558   |   |            |   | 161,770 |                |  |   | 4,441        |   |  |       | 268     |   |  |   | 171,037
|Net interest expense                        |  |        | 18,853  |   |            |   | 15,424  |                |  |   | 38           |   |  |       | (16,261 | ) |  |   | 18,054 
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|(Loss) income before income taxes           |  |        | (14,295 | ) |            |   | 146,346 |                |  |   | 4,403        |   |  |       | 16,529  |   |  |   | 152,983
|(Benefit from) provision for income taxes   |  |        | (33     | ) |            |   | 57,068  |                |  |   | 1,618        |   |  |       | 105     |   |  |   | 58,758 
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|(Loss) income from continuing operations    |  |        | (14,262 | ) |            |   | 89,278  |                |  |   | 2,785        |   |  |       | 16,424  |   |  |   | 94,225 
|Equity (earnings) in subsidiary, net of tax |  |        | (92,063 | ) |            |   | (2,785  | )              |  |   |             |   |  |       | 94,848  |   |  |   |       
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        
|Net income                                  |  | $      | 77,801  |   |            | $ | 92,063  |                |  | $ | 2,785        |   |  | $     | (78,424 | ) |  | $ | 94,225 
|                                            |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |        

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (UNAUDITED)

Three months ended June 30, 2007



|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|----------------------------------------------- |  | ------ | ------- | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | ----- | ------- | - |  | - | ------- | -
|                                                |  | Visant |         |   | Guarantors |   |         | Non-Guarantors |  |   | Eliminations |   |  | Total |        
|Net sales                                       |  | $      |        |   |            | $ | 491,270 |                |  | $ | 18,939       |   |  | $     | (8,743  | ) |  | $ | 501,466 |  
|Cost of products sold                           |  |        | (1,975  | ) |            |   | 218,429 |                |  |   | 10,268       |   |  |       | (8,946  | ) |  |   | 217,776 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Gross profit                                    |  |        | 1,975   |   |            |   | 272,841 |                |  |   | 8,671        |   |  |       | 203     |   |  |   | 283,690 |  
|Selling and administrative expenses             |  |        | 181     |   |            |   | 124,586 |                |  |   | 4,437        |   |  |       |        |   |  |   | 129,204 |  
|Loss on disposal of fixed assets                |  |        |        |   |            |   | 229     |                |  |   |             |   |  |       |        |   |  |   | 229     |  
|Special charges                                 |  |        |        |   |            |   | (41     | )              |  |   |             |   |  |       |        |   |  |   | (41     | )
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Operating income                                |  |        | 1,794   |   |            |   | 148,067 |                |  |   | 4,234        |   |  |       | 203     |   |  |   | 154,298 |  
|Net interest expense                            |  |        | 24,750  |   |            |   | 25,354  |                |  |   | 56           |   |  |       | (20,827 | ) |  |   | 29,333  |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|(Loss) income before income taxes               |  |        | (22,956 | ) |            |   | 122,713 |                |  |   | 4,178        |   |  |       | 21,030  |   |  |   | 124,965 |  
|(Benefit from) provision for income taxes       |  |        | (1,572  | ) |            |   | 46,215  |                |  |   | 1,437        |   |  |       | 80      |   |  |   | 46,160  |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|(Loss) income from continuing operations        |  |        | (21,384 | ) |            |   | 76,498  |                |  |   | 2,741        |   |  |       | 20,950  |   |  |   | 78,805  |  
|Equity (earnings) in subsidiary, net of tax     |  |        | (83,338 | ) |            |   | (2,718  | )              |  |   |             |   |  |       | 86,056  |   |  |   |        |  
|Income (loss) from discontinued operations, net |  |        | 98,430  |   |            |   | 4,122   |                |  |   | (23          | ) |  |       |        |   |  |   | 102,529 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Net income                                      |  | $      | 160,384 |   |            | $ | 83,338  |                |  | $ | 2,718        |   |  | $     | (65,106 | ) |  | $ | 181,334 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  



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CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (UNAUDITED)

Six months ended June 28, 2008



|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|------------------------------------------- |  | ------ | ------- | - | ---------- | - | ------- | -------------- |  | ------------ | ------ |  | ----- | ------- | - |  | - | -------
|In Thousands                                |  | Visant |         |   | Guarantors |   |         | Non-Guarantors |  | Eliminations |        |  | Total
|Net sales                                   |  | $      |        |   |            | $ | 793,759 |                |  | $            | 32,209 |  | $     | (11,294 | ) |  | $ | 814,674
|Cost of products sold                       |  |        | (8,193  | ) |            |   | 379,392 |                |  |              | 19,274 |  |       | (11,175 | ) |  |   | 379,298
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|Gross profit                                |  |        | 8,193   |   |            |   | 414,367 |                |  |              | 12,935 |  |       | (119    | ) |  |   | 435,376
|Selling and administrative expenses         |  |        | (304    | ) |            |   | 239,803 |                |  |              | 8,628  |  |       |        |   |  |   | 248,127
|Loss on disposal of fixed assets            |  |        |        |   |            |   | 2       |                |  |              |       |  |       |        |   |  |   | 2      
|Special charges                             |  |        |        |   |            |   | 3,886   |                |  |              |       |  |       |        |   |  |   | 3,886  
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|Operating income                            |  |        | 8,497   |   |            |   | 170,676 |                |  |              | 4,307  |  |       | (119    | ) |  |   | 183,361
|Net interest expense                        |  |        | 35,621  |   |            |   | 29,389  |                |  |              | 65     |  |       | (30,580 | ) |  |   | 34,495 
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|(Loss) income before income taxes           |  |        | (27,124 | ) |            |   | 141,287 |                |  |              | 4,242  |  |       | 30,461  |   |  |   | 148,866
|Provision for income taxes                  |  |        | 551     |   |            |   | 55,312  |                |  |              | 1,534  |  |       | (46     | ) |  |   | 57,351 
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|(Loss) income from continuing operations    |  |        | (27,675 | ) |            |   | 85,975  |                |  |              | 2,708  |  |       | 30,507  |   |  |   | 91,515 
|Equity (earnings) in subsidiary, net of tax |  |        | (88,683 | ) |            |   | (2,708  | )              |  |              |       |  |       | 91,391  |   |  |   |       
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        
|Net income                                  |  | $      | 61,008  |   |            | $ | 88,683  |                |  | $            | 2,708  |  | $     | (60,884 | ) |  | $ | 91,515 
|                                            |  |        |         |   |            |   |         |                |  |              |        |  |       |         |   |  |   |        

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (UNAUDITED)

Six months ended June 30, 2007



|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|----------------------------------------------- |  | ------ | ------- | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | ----- | ------- | - |  | - | ------- | -
|                                                |  | Visant |         |   | Guarantors |   |         | Non-Guarantors |  |   | Eliminations |   |  | Total |        
|Net sales                                       |  | $      |        |   |            | $ | 743,558 |                |  | $ | 29,304       |   |  | $     | (15,546 | ) |  | $ | 757,316 |  
|Cost of products sold                           |  |        | (4,209  | ) |            |   | 349,014 |                |  |   | 16,601       |   |  |       | (15,560 | ) |  |   | 345,846 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Gross profit                                    |  |        | 4,209   |   |            |   | 394,544 |                |  |   | 12,703       |   |  |       | 14      |   |  |   | 411,470 |  
|Selling and administrative expenses             |  |        | (38     | ) |            |   | 225,348 |                |  |   | 7,451        |   |  |       |        |   |  |   | 232,761 |  
|Loss on disposal of fixed assets                |  |        |        |   |            |   | 620     |                |  |   |             |   |  |       |        |   |  |   | 620     |  
|Special charges                                 |  |        |        |   |            |   | (41     | )              |  |   |             |   |  |       |        |   |  |   | (41     | )
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Operating income                                |  |        | 4,247   |   |            |   | 168,617 |                |  |   | 5,252        |   |  |       | 14      |   |  |   | 178,130 |  
|Net interest expense                            |  |        | 89,360  |   |            |   | 54,125  |                |  |   | 72           |   |  |       | (88,989 | ) |  |   | 54,568  |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|(Loss) income before income taxes               |  |        | (85,113 | ) |            |   | 114,492 |                |  |   | 5,180        |   |  |       | 89,003  |   |  |   | 123,562 |  
|(Benefit from) provision for income taxes       |  |        | (662    | ) |            |   | 44,732  |                |  |   | 1,790        |   |  |       | 6       |   |  |   | 45,866  |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|(Loss) income from continuing operations        |  |        | (84,451 | ) |            |   | 69,760  |                |  |   | 3,390        |   |  |       | 88,997  |   |  |   | 77,696  |  
|Equity (earnings) in subsidiary, net of tax     |  |        | (85,622 | ) |            |   | (3,367  | )              |  |   |             |   |  |       | 88,989  |   |  |   |        |  
|Income (loss) from discontinued operations, net |  |        | 98,430  |   |            |   | 12,495  |                |  |   | (23          | ) |  |       |        |   |  |   | 110,902 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  
|Net income                                      |  | $      | 99,601  |   |            | $ | 85,622  |                |  | $ | 3,367        |   |  | $     | 8       |   |  | $ | 188,598 |  
|                                                |  |        |         |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |         |  



27



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CONDENSED CONSOLIDATING BALANCE SHEET

June 28, 2008



|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|----------------------------------------- |  | ------ | --------- | - | ---------- | - | -------------- |  | - | ------------ | - |  | ----- | ---------- | - |  | - | ---------
|                                          |  | Visant |           |   | Guarantors |   | Non-Guarantors |  |   | Eliminations |   |  | Total
|ASSETS                                    |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|Cash and cash equivalents                 |  | $      | 1,172     |   |            | $ | 9,745          |  | $ | 8,745        |   |  | $     |           |   |  | $ | 19,662   
|Accounts receivable, net                  |  |        | 1,399     |   |            |   | 173,709        |  |   | 11,670       |   |  |       |           |   |  |   | 186,778  
|Inventories                               |  |        |          |   |            |   | 90,149         |  |   | 2,690        |   |  |       | (286       | ) |  |   | 92,553   
|Salespersons overdrafts, net              |  |        |          |   |            |   | 13,846         |  |   | 743          |   |  |       |           |   |  |   | 14,589   
|Prepaid expenses and other current assets |  |        | 735       |   |            |   | 10,318         |  |   | 1,223        |   |  |       |           |   |  |   | 12,276   
|Intercompany receivable                   |  |        | 13,647    |   |            |   | 66,229         |  |   |             |   |  |       | (79,303    | ) |  |   | 573      
|Deferred income taxes                     |  |        | 95        |   |            |   | 14,671         |  |   |             |   |  |       |           |   |  |   | 14,766   
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|Total current assets                      |  |        | 17,048    |   |            |   | 378,667        |  |   | 25,071       |   |  |       | (79,589    | ) |  |   | 341,197  
|Property, plant and equipment, net        |  |        | 854       |   |            |   | 210,080        |  |   | 104          |   |  |       |           |   |  |   | 211,038  
|Goodwill                                  |  |        |          |   |            |   | 983,841        |  |   | 22,154       |   |  |       |           |   |  |   | 1,005,995
|Intangibles, net                          |  |        |          |   |            |   | 616,453        |  |   | 9,439        |   |  |       |           |   |  |   | 625,892  
|Deferred financing costs, net             |  |        | 18,443    |   |            |   |               |  |   |             |   |  |       |           |   |  |   | 18,443   
|Intercompany receivable                   |  |        | 818,031   |   |            |   | 198,924        |  |   | 177          |   |  |       | (1,017,132 | ) |  |   |         
|Other assets                              |  |        | 40        |   |            |   | 14,163         |  |   | 88           |   |  |       |           |   |  |   | 14,291   
|Investment in subsidiaries                |  |        | 830,866   |   |            |   |               |  |   |             |   |  |       | (830,866   | ) |  |   |         
|Prepaid pension costs                     |  |        |          |   |            |   | 64,579         |  |   |             |   |  |       |           |   |  |   | 64,579   
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|                                          |  | $      | 1,685,282 |   |            | $ | 2,466,707      |  | $ | 57,033       |   |  | $     | (1,927,587 | ) |  | $ | 2,281,435
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|LIABILITIES AND STOCKHOLDERS EQUITY      |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|Book overdrafts                           |  | $      |          |   |            | $ | 3,194          |  | $ |             |   |  | $     |           |   |  | $ | 3,194    
|Short-term borrowings                     |  |        | 104,300   |   |            |   |               |  |   |             |   |  |       |           |   |  |   | 104,300  
|Accounts payable                          |  |        | 4,925     |   |            |   | 49,945         |  |   | 7,762        |   |  |       | 1          |   |  |   | 62,633   
|Accrued employee compensation             |  |        | 9,253     |   |            |   | 29,429         |  |   | 1,977        |   |  |       |           |   |  |   | 40,659   
|Customer deposits                         |  |        |          |   |            |   | 63,014         |  |   | 4,171        |   |  |       |           |   |  |   | 67,185   
|Commissions payable                       |  |        |          |   |            |   | 44,549         |  |   | 970          |   |  |       |           |   |  |   | 45,519   
|Income taxes payable                      |  |        | (15,481   | ) |            |   | 54,622         |  |   | 3,279        |   |  |       | (111       | ) |  |   | 42,309   
|Interest payable                          |  |        | 9,616     |   |            |   | 30             |  |   |             |   |  |       |           |   |  |   | 9,646    
|Intercompany payable                      |  |        | 726       |   |            |   | 78,578         |  |   |             |   |  |       | (79,304    | ) |  |   |         
|Other accrued liabilities                 |  |        | 3,361     |   |            |   | 32,058         |  |   | 935          |   |  |       |           |   |  |   | 36,354   
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|Total current liabilities                 |  |        | 116,700   |   |            |   | 355,419        |  |   | 19,094       |   |  |       | (79,414    | ) |  |   | 411,799  
|Long-term debt, less current maturities   |  |        | 816,500   |   |            |   |               |  |   |             |   |  |       |           |   |  |   | 816,500  
|Intercompany payable (receivable)         |  |        | 310,903   |   |            |   | 1,153,352      |  |   | (41,219      | ) |  |       | (1,423,036 | ) |  |   |         
|Deferred income taxes                     |  |        | 1,050     |   |            |   | 239,018        |  |   | (265         | ) |  |       |           |   |  |   | 239,803  
|Pension liabilities, net                  |  |        | (1,495    | ) |            |   | 23,449         |  |   |             |   |  |       |           |   |  |   | 21,954   
|Other noncurrent liabilities              |  |        | 11,542    |   |            |   | 22,111         |  |   |             |   |  |       |           |   |  |   | 33,653   
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|Total liabilities                         |  |        | 1,255,200 |   |            |   | 1,793,349      |  |   | (22,390      | ) |  |       | (1,502,450 | ) |  |   | 1,523,709
|Stockholders equity                      |  |        | 430,082   |   |            |   | 673,358        |  |   | 79,423       |   |  |       | (425,137   | ) |  |   | 757,726  
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          
|                                          |  | $      | 1,685,282 |   |            | $ | 2,466,707      |  | $ | 57,033       |   |  | $     | (1,927,587 | ) |  | $ | 2,281,435
|                                          |  |        |           |   |            |   |                |  |   |              |   |  |       |            |   |  |   |          



28



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CONDENSED CONSOLIDATING BALANCE SHEET

December 29, 2007



|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|----------------------------------------- |  | ------ | --------- | - | ---------- | - | --------- | -------------- |  | - | ------------ | - |  | ----- | ---------- | - |  | - | ---------
|                                          |  | Visant |           |   | Guarantors |   |           | Non-Guarantors |  |   | Eliminations |   |  | Total
|ASSETS                                    |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|Cash and cash equivalents                 |  | $      | 40,727    |   |            | $ | 10,815    |                |  | $ | 7,600        |   |  | $     |           |   |  | $ | 59,142   
|Accounts receivable, net                  |  |        | 2,119     |   |            |   | 122,342   |                |  |   | 14,435       |   |  |       |           |   |  |   | 138,896  
|Inventories                               |  |        |          |   |            |   | 101,879   |                |  |   | 2,212        |   |  |       | (167       | ) |  |   | 103,924  
|Salespersons overdrafts, net              |  |        |          |   |            |   | 27,663    |                |  |   | 1,067        |   |  |       |           |   |  |   | 28,730   
|Prepaid expenses and other current assets |  |        | 916       |   |            |   | 17,438    |                |  |   | 992          |   |  |       |           |   |  |   | 19,346   
|Intercompany receivable                   |  |        | 16,703    |   |            |   | 61,558    |                |  |   | 256          |   |  |       | (78,443    | ) |  |   | 74       
|Deferred income taxes                     |  |        | 95        |   |            |   | 12,566    |                |  |   |             |   |  |       |           |   |  |   | 12,661   
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|Total current assets                      |  |        | 60,560    |   |            |   | 354,261   |                |  |   | 26,562       |   |  |       | (78,610    | ) |  |   | 362,773  
|Property, plant and equipment, net        |  |        | 1,009     |   |            |   | 179,965   |                |  |   | 137          |   |  |       |           |   |  |   | 181,111  
|Goodwill                                  |  |        |          |   |            |   | 913,379   |                |  |   | 22,190       |   |  |       |           |   |  |   | 935,569  
|Intangibles, net                          |  |        |          |   |            |   | 505,729   |                |  |   | 9,614        |   |  |       |           |   |  |   | 515,343  
|Deferred financing costs, net             |  |        | 21,272    |   |            |   |          |                |  |   |             |   |  |       |           |   |  |   | 21,272   
|Intercompany receivable                   |  |        | 691,331   |   |            |   | 86,542    |                |  |   |             |   |  |       | (777,873   | ) |  |   |         
|Other assets                              |  |        | 40        |   |            |   | 12,061    |                |  |   | 79           |   |  |       |           |   |  |   | 12,180   
|Investment in subsidiaries                |  |        | 600,186   |   |            |   | 76,715    |                |  |   |             |   |  |       | (676,901   | ) |  |   |         
|Prepaid pension costs                     |  |        |          |   |            |   | 64,579    |                |  |   |             |   |  |       |           |   |  |   | 64,579   
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|                                          |  | $      | 1,374,398 |   |            | $ | 2,193,231 |                |  | $ | 58,582       |   |  | $     | (1,533,384 | ) |  | $ | 2,092,827
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|LIABILITIES AND STOCKHOLDERS EQUITY      |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|Short-term borrowings                     |  | $      |          |   |            | $ |          |                |  | $ | 714          |   |  | $     |           |   |  | $ | 714      
|Accounts payable                          |  |        | 2,847     |   |            |   | 37,518    |                |  |   | 6,382        |   |  |       | (12        | ) |  |   | 46,735   
|Accrued employee compensation             |  |        | 6,819     |   |            |   | 28,312    |                |  |   | 2,114        |   |  |       |           |   |  |   | 37,245   
|Customer deposits                         |  |        |          |   |            |   | 177,934   |                |  |   | 6,527        |   |  |       |           |   |  |   | 184,461  
|Commissions payable                       |  |        |          |   |            |   | 22,221    |                |  |   | 1,247        |   |  |       |           |   |  |   | 23,468   
|Income taxes payable                      |  |        | 1,711     |   |            |   | (3,398    | )              |  |   | 2,887        |   |  |       | (65        | ) |  |   | 1,135    
|Interest payable                          |  |        | 9,742     |   |            |   | 37        |                |  |   | 2            |   |  |       |           |   |  |   | 9,781    
|Intercompany payable                      |  |        | 1,155     |   |            |   | 78,444    |                |  |   |             |   |  |       | (79,599    | ) |  |   |         
|Other accrued liabilities                 |  |        | 2,853     |   |            |   | 23,810    |                |  |   | 3,443        |   |  |       |           |   |  |   | 30,106   
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|Total current liabilities                 |  |        | 25,127    |   |            |   | 364,878   |                |  |   | 23,316       |   |  |       | (79,676    | ) |  |   | 333,645  
|Long-term debt, less current maturities   |  |        | 816,500   |   |            |   |          |                |  |   |             |   |  |       |           |   |  |   | 816,500  
|Intercompany payable (receivable)         |  |        | 155,973   |   |            |   | 974,657   |                |  |   | (41,175      | ) |  |       | (1,089,455 | ) |  |   |         
|Deferred income taxes                     |  |        | (2,310    | ) |            |   | 208,785   |                |  |   | (274         | ) |  |       |           |   |  |   | 206,201  
|Pension liabilities                       |  |        | 67        |   |            |   | 24,944    |                |  |   |             |   |  |       |           |   |  |   | 25,011   
|Other noncurrent liabilities              |  |        | 9,967     |   |            |   | 19,781    |                |  |   |             |   |  |       |           |   |  |   | 29,748   
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|Total liabilities                         |  |        | 1,005,324 |   |            |   | 1,593,045 |                |  |   | (18,133      | ) |  |       | (1,169,131 | ) |  |   | 1,411,105
|Stockholders equity                      |  |        | 369,074   |   |            |   | 600,186   |                |  |   | 76,715       |   |  |       | (364,253   | ) |  |   | 681,722  
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          
|                                          |  | $      | 1,374,398 |   |            | $ | 2,193,231 |                |  | $ | 58,582       |   |  | $     | (1,533,384 | ) |  | $ | 2,092,827
|                                          |  |        |           |   |            |   |           |                |  |   |              |   |  |       |            |   |  |   |          



29



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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (UNAUDITED)

Six months ended June 28, 2008



|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|------------------------------------------------------------ |  | ------ | -------- | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | ----- | ------- | - |  | - | -------- | -
|                                                             |  | Visant |          |   | Guarantors |   |         | Non-Guarantors |  |   | Eliminations |   |  | Total |        
|Net income                                                   |  | $      | 61,008   |   |            | $ | 88,683  |                |  | $ | 2,708        |   |  | $     | (60,884 | ) |  | $ | 91,515   |  
|Other cash used in operating activities                      |  |        | (47,892  | ) |            |   | 9,545   |                |  |   | (1,275       | ) |  |       | 62,051  |   |  |   | 22,429   |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|Net cash provided by operating activities                    |  |        | 13,116   |   |            |   | 98,228  |                |  |   | 1,433        |   |  |       | 1,167   |   |  |   | 113,944  |  
|Purchases of property, plant and equipment                   |  |        | 1        |   |            |   | (21,889 | )              |  |   | 20           |   |  |       |        |   |  |   | (21,868  | )
|Proceeds from sale of property and equipment                 |  |        |         |   |            |   | 138     |                |  |   |             |   |  |       |        |   |  |   | 138      |  
|Acquisition of business, net of cash acquired                |  |        | (222,771 | ) |            |   | 1,349   |                |  |   |             |   |  |       |        |   |  |   | (221,422 | )
|Other investing activities, net                              |  |        |         |   |            |   | (481    | )              |  |   |             |   |  |       |        |   |  |   | (481     | )
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|Net cash (used in) provided by investing activities          |  |        | (222,770 | ) |            |   | (20,883 | )              |  |   | 20           |   |  |       |        |   |  |   | (243,633 | )
|Book overdrafts                                              |  |        |         |   |            |   | 2,253   |                |  |   |             |   |  |       |        |   |  |   | 2,253    |  
|Short-term borrowings                                        |  |        | 104,300  |   |            |   |        |                |  |   | (714         | ) |  |       |        |   |  |   | 103,586  |  
|Intercompany payable (receivable)                            |  |        | 81,856   |   |            |   | (80,689 | )              |  |   |             |   |  |       | (1,167  | ) |  |   |         |  
|Distribution to stockholders                                 |  |        | (16,057  | ) |            |   |        |                |  |   |             |   |  |       |        |   |  |   | (16,057  | )
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|Net cash provided by (used in) financing activities          |  |        | 170,099  |   |            |   | (78,436 | )              |  |   | (714         | ) |  |       | (1,167  | ) |  |   | 89,782   |  
|Effect of exchange rate changes on cash and cash equivalents |  |        |         |   |            |   | 21      |                |  |   | 406          |   |  |       |        |   |  |   | 427      |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|(Decrease) increase in cash and cash equivalents             |  |        | (39,555  | ) |            |   | (1,070  | )              |  |   | 1,145        |   |  |       |        |   |  |   | (39,480  | )
|Cash and cash equivalents, beginning of period               |  |        | 40,727   |   |            |   | 10,815  |                |  |   | 7,600        |   |  |       |        |   |  |   | 59,142   |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  
|Cash and cash equivalents, end of period                     |  | $      | 1,172    |   |            | $ | 9,745   |                |  | $ | 8,745        |   |  | $     |        |   |  | $ | 19,662   |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |         |   |  |   |          |  

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (UNAUDITED)

Six months ended June 30, 2007



|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|------------------------------------------------------------ |  | ------ | -------- | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | ----- | --- | - |  | - | -------- | -
|                                                             |  | Visant |          |   | Guarantors |   |         | Non-Guarantors |  |   | Eliminations |   |  | Total |    
|Net income                                                   |  | $      | 99,601   |   |            | $ | 85,622  |                |  | $ | 3,367        |   |  | $     | 8   |   |  | $ | 188,598  |  
|Other cash used in operating activities                      |  |        | (84,988  | ) |            |   | 6,100   |                |  |   | (3,910       | ) |  |       | (72 | ) |  |   | (82,870  | )
|Net cash provided by (used in) discontinued operations       |  |        | 8,485    |   |            |   | (3,874  | )              |  |   | (23          | ) |  |       |    |   |  |   | 4,588    |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|Net cash provided by (used in) operating activities          |  |        | 23,098   |   |            |   | 87,848  |                |  |   | (566         | ) |  |       | (64 | ) |  |   | 110,316  |  
|Purchases of property, plant and equipment                   |  |        | (19      | ) |            |   | (35,916 | )              |  |   | (67          | ) |  |       |    |   |  |   | (36,002  | )
|Proceeds from sale of property and equipment                 |  |        |         |   |            |   | 1,491   |                |  |   |             |   |  |       |    |   |  |   | 1,491    |  
|Acquisition of business, net of cash acquired                |  |        | (54,846  | ) |            |   | 3,033   |                |  |   |             |   |  |       | 64  |   |  |   | (51,749  | )
|Other investing activities, net                              |  |        |         |   |            |   | (8      | )              |  |   |             |   |  |       |    |   |  |   | (8       | )
|Net cash provided by (used in) discontinued operations       |  |        | 401,781  |   |            |   | (5,691  | )              |  |   |             |   |  |       |    |   |  |   | 396,090  |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|Net cash provided by (used in) investing activities          |  |        | 346,916  |   |            |   | (37,091 | )              |  |   | (67          | ) |  |       | 64  |   |  |   | 309,822  |  
|Principal payments on long-term debt                         |  |        | (400,000 | ) |            |   |        |                |  |   |             |   |  |       |    |   |  |   | (400,000 | )
|Intercompany payable (receivable)                            |  |        | 52,725   |   |            |   | (52,725 | )              |  |   |             |   |  |       |    |   |  |   |         |  
|Distribution to stockholders                                 |  |        | (2,552   | ) |            |   |        |                |  |   |             |   |  |       |    |   |  |   | (2,552   | )
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|Net cash used in financing activities                        |  |        | (349,827 | ) |            |   | (52,725 | )              |  |   |             |   |  |       |    |   |  |   | (402,552 | )
|Effect of exchange rate changes on cash and cash equivalents |  |        |         |   |            |   | (4      | )              |  |   | 398          |   |  |       |    |   |  |   | 394      |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|Increase (decrease) in cash and cash equivalents             |  |        | 20,187   |   |            |   | (1,972  | )              |  |   | (235         | ) |  |       |    |   |  |   | 17,980   |  
|Cash and cash equivalents, beginning of period               |  |        | 1,707    |   |            |   | 4,276   |                |  |   | 12,060       |   |  |       |    |   |  |   | 18,043   |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  
|Cash and cash equivalents, end of period                     |  | $      | 21,894   |   |            | $ | 2,304   |                |  | $ | 11,825       |   |  | $     |    |   |  | $ | 36,023   |  
|                                                             |  |        |          |   |            |   |         |                |  |   |              |   |  |       |     |   |  |   |          |  



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|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

Except where otherwise indicated, managements discussion and analysis of financial condition and results of operations is provided with respect to
Holdings, which has materially the same financial condition and results of operations as Visant, except for interest and the related income tax effect of certain indebtedness of Holdings. This discussion and analysis should be read in conjunction
with our condensed consolidated financial statements and notes thereto.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements including, without limitation, statements concerning the conditions in our industry, expected cost
savings, our operations, our economic performance and financial condition, including, in particular, statements relating to our business and growth strategy and product development efforts. These forward-looking statements are not historical facts,
but only predictions and generally can be identified by the use of statements that include such words as may, might, will, should, estimate, project, plan,
anticipate, expect, intend, outlook, believe and other similar expressions that are intended to identify forward-looking statements and information. These forward-looking statements are
based on estimates and assumptions by our management that, although we believe to be reasonable, are inherently uncertain and subject to a number of risks and uncertainties. These risks and uncertainties include, without limitation, those identified
under Item 1A. Risk Factors included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2007 and elsewhere in this report.

The following list represents some, but not necessarily all, of the factors that could cause actual results to differ from historical results or those anticipated or predicted by these forward-looking statements:



| |  |  | our substantial indebtedness;
| | - |  | -----------------------------



| |  |  | our inability to implement our business strategy and achieve anticipated cost savings in a timely and effective manner;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | competition from other companies;
| | - |  | ---------------------------------



| |  |  | the seasonality of our businesses;
| | - |  | ----------------------------------



| |  |  | the loss of significant customers or customer relationships;
| | - |  | ------------------------------------------------------------



| |  |  | fluctuations in raw material prices;
| | - |  | ------------------------------------



| |  |  | our reliance on a limited number of suppliers;
| | - |  | ----------------------------------------------



| |  |  | our reliance on numerous complex information systems;
| | - |  | -----------------------------------------------------



| |  |  | the reliance of our businesses on limited production facilities;
| | - |  | ----------------------------------------------------------------



| |  |  | the amount of capital expenditures required at our businesses;
| | - |  | --------------------------------------------------------------



| |  |  | labor disturbances;
| | - |  | -------------------



| |  |  | environmental regulations;
| | - |  | --------------------------



| |  |  | foreign currency fluctuations and foreign exchange rates;
| | - |  | ---------------------------------------------------------



| |  |  | the outcome of litigation;
| | - |  | --------------------------



| |  |  | our dependency on the sale of school textbooks;
| | - |  | -----------------------------------------------



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| |  |  | control by our stockholders;
| | - |  | ----------------------------



| |  |  | Jostens reliance on independent sales representatives;
| | - |  | -------------------------------------------------------



| |  |  | the failure of our sampling systems to comply with U.S. postal regulations;
| | - |  | ---------------------------------------------------------------------------



| |  |  | levels of customers advertising spending, including as may be impacted by economic factors;
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | changes in book-buying habits; and
| | - |  | ----------------------------------



| |  |  | the textbook adoption cycle and levels of government funding for education spending.
| | - |  | ------------------------------------------------------------------------------------

We caution you that the foregoing list of important factors is not exclusive. In addition, in light of these risks and uncertainties, the matters
referred to in the forward-looking statements contained in this report may not in fact occur. Forward-looking statements speak only as of the date they are made and we undertake no obligation to update publicly or revise any of them in light of new
information, future events or otherwise, except as required by law.

GENERAL

We are a leading marketing and publishing services enterprise servicing the school affinity, direct marketing, fragrance and cosmetics sampling, and
educational and trade publishing segments. We were formed through the October 2004 consolidation (the Transactions) of Jostens, Inc. (Jostens), Von Hoffmann Holdings Inc. and its subsidiaries (Von Hoffmann)
and AHC I Acquisition Corp. and its subsidiaries, including AKI, Inc. (Arcade). We sell our products and services to end customers through several different sales channels including independent sales representatives and dedicated sales
forces. Our sales and results of operations are impacted by a number of factors, including general economic conditions, seasonality, cost of raw materials, school population trends, product quality, service and price.

In May 2007, we completed the sale of our Von Hoffmann Holdings Inc., Von Hoffmann Corporation and Anthology, Inc. businesses (the Von Hoffmann
businesses), which previously comprised the Educational Textbook segment and a portion of the Marketing and Publishing Services segment. The operations of the Von Hoffmann businesses were reported as discontinued operations in the consolidated
financial statements for all periods presented.

During 2007, we expanded our business with the acquisitions of Neff Holding Company and
its wholly owned subsidiary, Neff Motivation, Inc. (Neff), Visual Systems, Inc. (VSI) and Publishing Enterprises, Incorporated (Publishing Enterprises). Neff, a single source provider of custom award programs and
apparel, including chenille letters and letter jackets, was acquired on March 16, 2007, and its results are included in the Scholastic segment as of such date. VSI, a supplier in the overhead transparency and book component business, was
acquired on June 14, 2007, and its results are included in the Marketing and Publishing Services segment as of such date. Publishing Enterprises, a producer of school memory books and student planners, was acquired on October 1, 2007, and
its results are included in the Memory Book segment as of such date.

On April 1, 2008, the Company announced the completion of the
acquisition of Phoenix Color Corp. (Phoenix Color), a book component manufacturer, including cash on hand of $1.3 million and restrictive covenants with certain key Phoenix Color stockholders, for approximately $222.7 million in cash,
subject to adjustment. The acquisition was accomplished through a merger of a wholly owned subsidiary of Visant and Phoenix Color, with Phoenix Color as the surviving entity. The results of the Phoenix Color operations are reported as part of the
Marketing and Publishing Services segment from the acquisition date, and as such, all of its goodwill will be allocated to that segment.

Our three reportable segments as of June 28, 2008 were:



| |  |  | Scholasticprovides services related to the marketing, sale and production of class rings and an array of graduation products and other scholastic
products to students and administrators primarily in high schools, colleges and other post-secondary institutions;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



32



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##### Table of Contents

| |  |  | Memory Bookprovides services related to the publication, marketing, sale and production of school yearbooks, memory books and related products that
help people tell their stories and chronicle important events; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Marketing and Publishing Servicesproduces multi-sensory and interactive advertising sampling systems, primarily for the fragrance, cosmetics and
personal care market segments, and produces innovative products and services to the direct marketing sector. The group also produces book components and overhead transparencies.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We experience seasonal fluctuations in our net sales tied primarily to the North American school year. Jostens generates a significant portion of its
annual net sales in the second quarter. Deliveries of caps, gowns and diplomas for spring graduation ceremonies and spring deliveries of school yearbooks are the key drivers of Jostens seasonality. The net sales of educational book
components are impacted seasonally by state and local schoolbook purchasing schedules, which commence in the spring and peak in the summer months preceding the start of the school year. The net sales of sampling and other direct mail and
commercial printed products have also historically reflected seasonal variations, and we expect these businesses to continue to generate a majority of their annual net sales during our third and fourth quarters for the foreseeable future. These
seasonal variations are based on the timing of customers advertising campaigns, which have traditionally been concentrated prior to the Christmas and spring holiday seasons. The seasonality of each of our businesses requires us to
allocate our resources to manage our manufacturing capacity, which often operates at full or near full capacity during peak seasonal demands.

We continue to experience more limited visibility to the flow and placement of orders in our Marketing and Publishing Services segment, which we believe is the result of tighter economic and general market conditions affecting the timing of
decisions and the extent of advertising spending by our customers. We believe these conditions may negatively affect the level of spending by our customers in our Marketing and Publishing Services segment. While historically the purchase of class
rings has been relatively resistant to economic conditions, we saw a shift in jewelry metal mix from gold to lesser priced metals in the first half of 2008 which we believe was attributable in part to economic factors and the impact of significantly
higher precious metal costs on our jewelry prices. We anticipate the trends we saw in the first half in jewelry volume, metal mix and price will continue in the fall of 2008.

Company Background

On October 4, 2004, an affiliate of Kohlberg Kravis Roberts & Co.
L.P. (KKR) and affiliates of DLJ Merchant Banking Partners completed a series of transactions which created a marketing and publishing services enterprise, servicing the school affinity products, direct marketing, fragrance and cosmetics
sampling and educational publishing segments through the consolidation of Jostens, Von Hoffmann and Arcade.

Prior to the Transactions, Von
Hoffmann and Arcade were each controlled by affiliates of DLJ Merchant Banking Partners II, L.P. (DLJMBP II), and DLJ Merchant Banking Partners III, L.P. (DLJMBP III) owned approximately 82.5% of our outstanding equity, with
the remainder held by other co-investors and certain members of management. Upon consummation of the Transactions, an affiliate of KKR invested $256.1 million and was issued equity interests representing approximately 49.6% of our voting
interest and 45.0% of our economic interest, and affiliates of DLJMBP III held equity interests representing approximately 41.0% of Holdings voting interest and 45.0% of Holdings economic interest, with the remainder held by other
co-investors and certain members of management. After giving effect to the issuance of equity to additional members of management, as of August 4, 2008, affiliates of KKR and DLJMBP III (the Sponsors) held approximately 49.0% and
41.0%, respectively, of Holdings voting interest, while each continued to hold approximately 44.6% of Holdings economic interest. As of August 4, 2008, the other co-investors held approximately 8.4% of the voting interest and 9.2%
of the economic interest of Holdings, and members of management held approximately 1.6% of the voting interest and approximately 1.6% of the economic interest of Holdings.

CRITICAL ACCOUNTING POLICIES

The preparation of interim financial statements involves the use of
certain estimates that differ from those used in the preparation of annual financial statements, the most significant of which relate to income taxes. For purposes of preparing our interim financial statements, we utilize an estimated annual
effective tax rate based on estimates of the components that impact the tax rate. Those components are re-evaluated each interim period and, if changes in our estimates are significant, we modify our estimate of the annual effective tax rate and
make any required adjustments in the interim period.



33



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There have been no material changes to our critical accounting policies and estimates as described in
Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 29, 2007.

Recent Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans
(SFAS No. 158). SFAS No. 158 requires the recognition of the funded status of a benefit plan in the balance sheet; the recognition in other comprehensive income of gains or losses and prior service costs or credits
arising during the period but which are not included as components of periodic benefit cost; the measurement of defined benefit plan assets and obligations as of the balance sheet date; and disclosure of additional information about the effects on
periodic benefit cost for the following fiscal year arising from delayed recognition in the current period. In addition, SFAS No. 158 amends SFAS No. 87, Employers Accounting for Pensions, and SFAS No. 106,
Employers Accounting for Postretirement Benefits Other Than Pensions, to include guidance regarding selection of assumed discount rates for use in measuring the benefit obligation. The requirement to recognize the funded status of a
benefit plan and the disclosure requirements are effective as of the end of the fiscal year ending after December 15, 2007. The Company adopted the balance sheet recognition provisions of SFAS 158 as of December 29, 2007, which resulted in
an increase to prepaid pension assets of $64.6 million, an increase to total liabilities of $32.2 million and an increase to stockholders equity of $32.4 million, net of taxes. SFAS No. 158 also requires plan assets and benefit
obligations to be measured as of the balance sheet of the Companys fiscal year-end. The Company has historically used a September 30 measurement date. The change in measurement date provision of SFAS No. 158 is effective
for Visants fiscal year 2008, and as a result, the Company will adopt this change in measurement date by adjusting ending retained earnings. The Company does not expect the impact of adopting the measurement
date provision of SFAS No. 158 to be material to the financial statements.

In September 2006, the FASB issued SFAS No. 157,
Fair Value Measurements (SFAS No. 157), which establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. SFAS No. 157 requires companies to disclose the fair value
of their financial instruments according to a fair value hierarchy as defined in the standard. SFAS No. 157 became effective as of the beginning of the Companys 2008 fiscal year. In February 2008, the FASB issued Staff Positions
No. 157-1 and No. 157-2, which remove certain leasing transactions from SFAS No. 157s scope and partially defer the effective date of SFAS 157 for one year for certain nonfinancial assets and liabilities. The Company adopted
SFAS No. 157 as of the beginning of fiscal year 2008, with the exception of the application of SFAS No. 157 to non-recurring nonfinancial assets and nonfinancial liabilities. The Company does not have financial assets or financial
liabilities that are currently measured and reported on the balance sheet on a fair value basis.

In February 2007, the FASB issued SFAS
No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS No. 159). SFAS No. 159 permits entities to measure many financial assets and financial liabilities at fair value. Unrealized gains
and losses on items for which the fair value option has been elected are reported in earnings. SFAS No. 159 became effective as of the beginning of the Companys 2008 fiscal year. The Company has adopted SFAS 159 and has elected not to
apply the fair value option to any financial instruments.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations(SFAS No. 141(R)),which changes how business acquisitions are accounted. SFAS No. 141(R) requires the acquiring entity in a business combination to recognize all (and only) the assets acquired and liabilities
assumed in the transaction and establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed in a business combination. Certain provisions of this standard will, among other things: impact
the determination of acquisition-date fair value of consideration paid in a business combination (including contingent consideration); exclude transaction costs for acquisition accounting; and change accounting practices from acquired contingencies,
acquisition-related restructuring costs, in-process research and development, indemnification assets and tax benefits. SFAS No. 141(R) is effective for business combinations and adjustments to an acquired entitys deferred tax asset and
liability balances occurring after December 31, 2008. The Company cannot anticipate whether the adoption of SFAS No. 141R will have a material impact to the financial statements as the impact is solely dependent on whether the Company
enters into a business combination after December 31, 2008 and the terms of such a transaction.

In December 2007, the FASB issued
SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements(SFAS No. 160), an amendment of Accounting Research Bulletin No. 51, which establishes new standards governing the accounting for and
reporting on noncontrolling interests (NCIs) in partially owned consolidated subsidiaries and the loss of



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control of subsidiaries. Certain provisions of SFAS No. 160 indicate, among other things, that NCIs (previously referred to as minority interests) be
treated as a separate component of equity, not as a liability, among other things, that increases and decreases in the parents ownership interest that leave control intact be treated as equity transactions, rather than a step acquisition or
dilution gains or losses; and that losses of a partially owned consolidated subsidiary be allocated to the NCI even when such allocation might result in a deficit balance. SFAS No. 160 also requires changes to certain presentation and
disclosure requirements. SFAS No. 160 is effective beginning January 1, 2009. The Company is currently evaluating the impact and disclosure implications of SFAS No. 160 but does not expect it to have a significant impact, if any, in
the financial statements.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging
Activities,an amendment of FASB Statement No. 133 (SFAS No. 161). This statement is intended to improve transparency in financial reporting by requiring enhanced disclosures of an entitys derivative instruments and
hedging activities and their effects on the entitys financial position, financial performance and cash flows. SFAS No. 161 applies to all derivative instruments within the scope of SFAS No. 133, Accounting for Derivative
Instruments and Hedging Activities(SFAS No. 133) as well as related hedged items, bifurcated derivatives and nonderivative instruments that are designated and qualify as hedging instruments. Entities with instruments subject to
SFAS No. 161 must provide more robust qualitative disclosures and expanded quantitative disclosures. SFAS No. 161 is effective prospectively for financial statements issued for fiscal years and interim periods beginning after
November 15, 2008, with an early adoption permitted. The Company is currently evaluating the disclosure implications of this statement.

In April 2008, the FASB issued FSP No. FAS 142-3, Determination of the Useful Life of Intangible Assets, which amends the list of factors an entity should consider in developing renewal or extension assumptions used in
determining the useful life of recognized intangible assets under SFAS No. 142, Goodwill and Other Intangible Assets. The new guidance applies to (1) intangible assets that are acquired individually or with a group of other assets
and (2) intangible assets acquired in both business combinations and asset acquisitions. Under FSP No. FAS 142-3, entities estimating the useful life of a recognized intangible asset must consider their historical experience in renewing or
extending similar arrangements or, in the absence of historical experience, must consider assumptions that market participants would use about renewal or extension. This FSP will require certain additional disclosures beginning January 1, 2009
and the application to useful life estimates prospectively for intangible assets acquired after December 31, 2008. The Company does not expect this standard to have a significant impact, if any, in the financial statements.



35



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##### Table of Contents

RESULTS OF OPERATIONS

Three Months Ended June 28, 2008 Compared to the Three Months Ended June 30, 2007

The following table sets forth
selected information derived from Holdings condensed consolidated statements of operations for the three-month periods ended June 28, 2008 and June 30, 2007.



|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|----------------------------------------------- |  | ------------------ | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                                |  | Three months ended |         |   |              |   |         |          | 
|In thousands                                    |  | June 28,2008       |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                                       |  | $                  | 567,634 |   |              | $ | 501,466 |          |  | $ | 66,168   |   |  | 13.2  | % 
|Cost of products sold                           |  |                    | 251,180 |   |              |   | 217,776 |          |  |   | 33,404   |   |  | 15.3  | % 
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Gross profit                                    |  |                    | 316,454 |   |              |   | 283,690 |          |  |   | 32,764   |   |  | 11.5  | % 
|% of net sales                                  |  |                    | 55.7    | % |              |   | 56.6    | %        |  |   |          |   |  |       |   
|Selling and administrative expenses             |  |                    | 143,203 |   |              |   | 129,400 |          |  |   | 13,803   |   |  | 10.7  | % 
|% of net sales                                  |  |                    | 25.2    | % |              |   | 25.8    | %        |  |   |          |   |  |       |   
|Loss on disposal of fixed assets                |  |                    | 22      |   |              |   | 229     |          |  |   | (207     | ) |  | NM    |   
|Special charges                                 |  |                    | 2,435   |   |              |   | (41     | )        |  |   | 2,476    |   |  | NM    |   
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                                |  |                    | 170,794 |   |              |   | 154,102 |          |  |   | 16,692   |   |  | 10.8  | % 
|% of net sales                                  |  |                    | 30.1    | % |              |   | 30.7    | %        |  |   |          |   |  |       |   
|Interest expense, net                           |  |                    | 31,988  |   |              |   | 42,694  |          |  |   | (10,706  | ) |  | (25.1 | )%
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Income before income taxes                      |  |                    | 138,806 |   |              |   | 111,408 |          |  |   | 27,398   |   |  |       |   
|Provision for income taxes                      |  |                    | 54,162  |   |              |   | 41,436  |          |  |   | 12,726   |   |  | 30.7  | % 
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Income from continuing operations               |  |                    | 84,644  |   |              |   | 69,972  |          |  |   | 14,672   |   |  | 21.0  | % 
|Income from discontinued operations, net of tax |  |                    |        |   |              |   | 102,529 |          |  |   | (102,529 | ) |  | NM    |   
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Net income                                      |  | $                  | 84,644  |   |              | $ | 172,501 |          |  | $ | (87,857  | ) |  | (50.9 | )%
|                                                |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful

The following table sets forth selected segment information derived from Holdings condensed
consolidated statements of operations for the three-month periods ended June 28, 2008 and June 30, 2007. For additional financial information about our operating segments, see Note 16, Business Segments, to the condensed
consolidated financial statements.



36



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##### Table of Contents

|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|--------------------------------- |  | ------------------ | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                  |  | Three months ended |         |   |              |   |         |          | 
|In thousands                      |  | June 28,2008       |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                         |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 143,625 |   |              | $ | 136,096 |          |  | $ | 7,529    |   |  | 5.5   | % 
|Memory Book                       |  |                    | 283,450 |   |              |   | 264,524 |          |  |   | 18,926   |   |  | 7.2   | % 
|Marketing and Publishing Services |  |                    | 141,039 |   |              |   | 100,962 |          |  |   | 40,077   |   |  | 39.7  | % 
|Inter-segment eliminations        |  |                    | (480    | ) |              |   | (116    | )        |  |   | (364     | ) |  | NM    |   
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Net sales                         |  | $                  | 567,634 |   |              | $ | 501,466 |          |  | $ | 66,168   |   |  | 13.2  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 25,195  |   |              | $ | 24,978  |          |  | $ | 217      |   |  | 0.9   | % 
|Memory Book                       |  |                    | 123,452 |   |              |   | 112,067 |          |  |   | 11,385   |   |  | 10.2  | % 
|Marketing and Publishing Services |  |                    | 22,147  |   |              |   | 17,057  |          |  |   | 5,090    |   |  | 29.8  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  | $                  | 170,794 |   |              | $ | 154,102 |          |  | $ | 16,692   |   |  | 10.8  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and amortization     |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                  | 6,275   |   |              | $ | 6,295   |          |  | $ | (20      | ) |  | (0.3  | )%
|Memory Book                       |  |                    | 9,701   |   |              |   | 9,584   |          |  |   | 117      |   |  | 1.2   | % 
|Marketing and Publishing Services |  |                    | 11,021  |   |              |   | 5,433   |          |  |   | 5,588    |   |  | 102.9 | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and amortization     |  | $                  | 26,997  |   |              | $ | 21,312  |          |  | $ | 5,685    |   |  | 26.7  | % 
|                                  |  |                    |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful

Net Sales.Consolidated net sales increased $66.2 million, or approximately 13.2%, to $567.6 million
for the three months ended June 28, 2008 as compared to the same prior year period in 2007.

Net sales of the Scholastic segment
increased $7.5 million, or 5.5%, to $143.6 million for the second quarter of 2008 from $136.1 million for the second quarter of 2007. The increase was primarily attributable to higher volumes and prices in our jewelry and announcement products,
partially offset by a shift in metal mix in our jewelry products.

Net sales of the Memory Book segment increased $18.9 million, or 7.2%,
to $283.4 million for the second quarter of 2008 compared to $264.5 million for the second quarter of 2007. The increase was due mainly to account growth, increased sales driven by new and enhanced product and service offerings and the acquisition
of Publishing Enterprises made during the fourth quarter of 2007.

Net sales of the Marketing and Publishing Services segment increased
$40.0 million, or 39.7%, to $141.0 million for the second quarter of 2008 from $101.0 million for the second quarter of 2007. This increase was primarily attributable to incremental volume from the recent Phoenix Color acquisition and the VSI
acquisition completed in 2007, as well as slightly higher volume in our sampling and direct mail businesses.

Gross Profit. Gross
profit increased $32.8 million, or 11.5%, to $316.5 million for the three months ended June 28, 2008 from $283.7 million for the same period in 2007. As a percentage of net sales, gross profit margin decreased to 55.7% for the three months
ended June 28, 2008 from 56.6% for the comparable period in 2007. The decrease in gross profit margin was attributable to:



| |  |  | higher precious metal costs and a shift in product mix in the Scholastic segment;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | lower relative margins of businesses acquired; and
| | - |  | --------------------------------------------------



| |  |  | higher depreciation costs.
| | - |  | --------------------------



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##### Table of Contents

The decrease was partially offset by:



| |  |  | increased prices in our Scholastic segment;
| | - |  | -------------------------------------------



| |  |  | increased sales volume and strong operating performance in our Memory Book facilities;
| | - |  | --------------------------------------------------------------------------------------



| |  |  | sales of higher margin products in our sampling business; and
| | - |  | -------------------------------------------------------------



| |  |  | the impact of cost reduction initiatives.
| | - |  | -----------------------------------------

Selling and Administrative Expenses. Selling and administrative expenses increased $13.8 million, or 10.7%, to $143.2 million for the three months ended June 28, 2008 from $129.4 million for the corresponding period in 2007. As
a percentage of net sales, selling and administrative expenses decreased 0.6% to 25.2% for the second fiscal quarter of 2008 from 25.8% for the same period in 2007. The decrease as a percentage of net sales was due to:



| |  |  | our ability to leverage existing infrastructure while increasing sales; and
| | - |  | ---------------------------------------------------------------------------



| |  |  | the acquisition of businesses that maintain lower selling costs as a percentage of sales.
| | - |  | -----------------------------------------------------------------------------------------

The decrease was partially offset by higher amortization costs and increased commissions and incentives due to a shift in timing of sales into the second
quarter of 2008 from the first quarter of 2008.

Special Charges.Special charges for the second quarter ended June 28, 2008
included $1.2 million of costs in the Marketing and Publishing Services segment related to the closure of the Pennsauken, New Jersey facilities and $0.3 million related to other special charges for Marketing and Publishing Services segment. Our
Scholastic and Memory Book segments recorded $0.5 million and $0.4 million, respectively, of severance and related benefits pertaining to headcount reductions. Special charges for the second quarter ended June 30, 2007 represent a reversal of
less than $0.1 million for severance and related benefit costs associated with headcount reductions in the Scholastic and Memory Book segments.

Operating Income.As a result of the foregoing, consolidated operating income increased $16.7 million to $170.8 million for the three months ended June 28, 2008 compared to $154.1 million for the comparable period in 2007. As a
percentage of net sales, operating income decreased to 30.1% for the second fiscal quarter of 2008 from 30.7% for the same period in 2007.



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##### Table of Contents

Net Interest Expense.Net interest expense was comprised of the following:



|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|------------------------------------------------------------------- |  | ------------------ | ------ | - | ------------ | - | ------ | -------- |  | - | -------- | - |  | ----- | --
|                                                                    |  | Three months ended |        |   |              |   |        |          | 
|In thousands                                                        |  | June 28,2008       |        |   | June 30,2007 |   |        | $ Change |  |   | % Change |  
|Visant:                                                             |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense                                                    |  | $                  | 16,684 |   |              | $ | 20,088 |          |  | $ | (3,404   | ) |  | (16.9 | )%
|Amortization of debt discount, premium and deferred financing costs |  |                    | 1,411  |   |              |   | 9,716  |          |  |   | (8,305   | ) |  | (85.5 | )%
|Interest income                                                     |  |                    | (41    | ) |              |   | (471   | )        |  |   | 430      |   |  | NM    |   
|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Visant interest expense, net                                        |  |                    | 18,054 |   |              |   | 29,333 |          |  |   | (11,279  | ) |  | (38.5 | )%
|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Holdings:                                                           |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense                                                    |  |                    | 7,637  |   |              |   | 7,635  |          |  |   | 2        |   |  | 0.0   | % 
|Amortization of debt discount, premium and deferred financing costs |  |                    | 6,297  |   |              |   | 5,728  |          |  |   | 569      |   |  | 9.9   | % 
|Interest income                                                     |  |                    |       |   |              |   | (2     | )        |  |   | 2        |   |  | NM    |   
|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Holdings interest expense, net                                      |  |                    | 13,934 |   |              |   | 13,361 |          |  |   | 573      |   |  | 4.3   | % 
|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense, net                                               |  | $                  | 31,988 |   |              | $ | 42,694 |          |  | $ | (10,706  | ) |  | (25.1 | )%
|                                                                    |  |                    |        |   |              |   |        |          |  |   |          |   |  |       |   



NM = Not meaningful

Net interest expense decreased $10.7 million, or 25.1%, to $32.0 million for the three months ended
June 28, 2008 compared to $42.7 million for the comparable prior year period. The decrease was due to overall lower outstanding debt balances, reduced amortization and deferred financing costs resulting from early paydown of outstanding
debt obligations and lower average interest rates during the three months ended June 28, 2008 compared with the three months ended June 30, 2007.

Income Taxes.The Company has recorded an income tax provision for the three months ended June 28, 2008 based on its best estimate of the consolidated effective tax rate applicable for the entire year plus
tax adjustments considered a period expense or benefit. The effective tax rates for the three months ended June 28, 2008 were 39.0% and 38.4% for Holdings and Visant, respectively. For the comparable three-month period ended June 30, 2007,
the effective tax rates were 37.2% and 36.9% for Holdings and Visant, respectively. The effective tax rates for the 2008 period were greater than the rates for the comparable 2007 period due to increased state income tax rates and reduced benefits
from the domestic manufacturing deduction related to the effect of deductible transaction costs for the Phoenix Color acquisition.

Income from Discontinued Operations.As of June 30, 2007, the operations of the Von Hoffmann businesses were recorded in income from discontinued operations. The sale of Von Hoffman closed on May 16, 2007 with the Company
recognizing net proceeds of $401.8 million and a gain of $98.4 million on the transaction during the second quarter of 2007. Net income from the Von Hoffmann businesses for the second quarter of 2007 was $3.7 million.

We also had income of $0.4 million, net of tax, for the three months ended June 30, 2007 from the Jostens Photography business, which was sold in
the second quarter of 2006.

Net Income.As a result of the aforementioned items, net income decreased $87.9 million
to $84.6 million for the three months ended June 28, 2008 compared to net income of $172.5 million for the three months ended June 30, 2007.

Six Months Ended June 28, 2008 Compared to the Six Months Ended June 30, 2007

The
following table sets forth selected information derived from Holdings condensed consolidated statements of operations for the six-month periods ended June 28, 2008 and June 30, 2007



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|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|----------------------------------------------- |  | ---------------- | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                                |  | Six months ended |         |   |              |   |         |          | 
|In thousands                                    |  | June 28,2008     |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                                       |  | $                | 814,674 |   |              | $ | 757,316 |          |  | $ | 57,358   |   |  | 7.6   | % 
|Cost of products sold                           |  |                  | 379,298 |   |              |   | 345,846 |          |  |   | 33,452   |   |  | 9.7   | % 
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Gross profit                                    |  |                  | 435,376 |   |              |   | 411,470 |          |  |   | 23,906   |   |  | 5.8   | % 
|% of net sales                                  |  |                  | 53.4    | % |              |   | 54.3    | %        |  |   |          |   |  |       |   
|Selling and administrative expenses             |  |                  | 248,531 |   |              |   | 233,142 |          |  |   | 15,389   |   |  | 6.6   | % 
|% of net sales                                  |  |                  | 30.5    | % |              |   | 30.8    | %        |  |   |          |   |  |       |   
|Loss on disposal of fixed assets                |  |                  | 2       |   |              |   | 620     |          |  |   | (618     | ) |  | NM    |   
|Special charges                                 |  |                  | 3,886   |   |              |   | (41     | )        |  |   | 3,927    |   |  | NM    |   
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                                |  |                  | 182,957 |   |              |   | 177,749 |          |  |   | 5,208    |   |  | 2.9   | % 
|% of net sales                                  |  |                  | 22.5    | % |              |   | 23.5    | %        |  |   |          |   |  |       |   
|Interest expense, net                           |  |                  | 62,261  |   |              |   | 81,202  |          |  |   | (18,941  | ) |  | (23.3 | )%
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Income before income taxes                      |  |                  | 120,696 |   |              |   | 96,547  |          |  |   | 24,149   |   |  |       |   
|Provision for income taxes                      |  |                  | 47,407  |   |              |   | 36,187  |          |  |   | 11,220   |   |  | 31.0  | % 
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Income from continuing operations               |  |                  | 73,289  |   |              |   | 60,360  |          |  |   | 12,929   |   |  | 21.4  | % 
|Income from discontinued operations, net of tax |  |                  |        |   |              |   | 110,902 |          |  |   | (110,902 | ) |  | NM    |   
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Net income                                      |  | $                | 73,289  |   |              | $ | 171,262 |          |  | $ | (97,973  | ) |  | (57.2 | )%
|                                                |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful

The following table sets forth selected segment information derived from Holdings condensed consolidated
statements of operations for the six-month periods ended June 28, 2008 and June 30, 2007. For additional financial information about our operating segments, see Note 16, Business Segments, to the condensed consolidated financial
statements.



|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|--------------------------------- |  | ---------------- | ------- | - | ------------ | - | ------- | -------- |  | - | -------- | - |  | ----- | --
|                                  |  | Six months ended |         |   |              |   |         |          | 
|In thousands                      |  | June 28,2008     |         |   | June 30,2007 |   |         | $ Change |  |   | % Change |  
|Net sales                         |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 282,647 |   |              | $ | 276,401 |          |  | $ | 6,246    |   |  | 2.3   | % 
|Memory Book                       |  |                  | 292,090 |   |              |   | 272,375 |          |  |   | 19,715   |   |  | 7.2   | % 
|Marketing and Publishing Services |  |                  | 240,844 |   |              |   | 209,013 |          |  |   | 31,831   |   |  | 15.2  | % 
|Inter-segment eliminations        |  |                  | (907    | ) |              |   | (473    | )        |  |   | (434     | ) |  | NM    |   
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Net sales                         |  | $                | 814,674 |   |              | $ | 757,316 |          |  | $ | 57,358   |   |  | 7.6   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 37,801  |   |              | $ | 47,470  |          |  | $ | (9,669   | ) |  | (20.4 | )%
|Memory Book                       |  |                  | 107,390 |   |              |   | 94,948  |          |  |   | 12,442   |   |  | 13.1  | % 
|Marketing and Publishing Services |  |                  | 37,766  |   |              |   | 35,331  |          |  |   | 2,435    |   |  | 6.9   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Operating income                  |  | $                | 182,957 |   |              | $ | 177,749 |          |  | $ | 5,208    |   |  | 2.9   | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and amortization     |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Scholastic                        |  | $                | 13,353  |   |              | $ | 13,215  |          |  | $ | 138      |   |  | 1.0   | % 
|Memory Book                       |  |                  | 18,614  |   |              |   | 18,061  |          |  |   | 553      |   |  | 3.1   | % 
|Marketing and Publishing Services |  |                  | 17,760  |   |              |   | 10,896  |          |  |   | 6,864    |   |  | 63.0  | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   
|Depreciation and amortization     |  | $                | 49,727  |   |              | $ | 42,172  |          |  | $ | 7,555    |   |  | 17.9  | % 
|                                  |  |                  |         |   |              |   |         |          |  |   |          |   |  |       |   



NM = Not meaningful

Net Sales.Consolidated net sales increased $57.4 million, or 7.6%, to $814.7 million for the six
months ended June 28, 2008 from $757.3 million for the corresponding period in 2007.



40



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##### Table of Contents

For the six months ended June 28, 2008, net sales for the Scholastic segment were $282.6 million, an
increase of 2.3%, compared to $276.4 million in the prior year comparative period. This $6.2 million increase was primarily attributable to incremental volume driven by the acquisition of Neff, which occurred in the first quarter of 2007, and the
impact of price increases for jewelry products, partially offset by lower overall volume in our jewelry and announcement products for the six-month period and a shift in metal mix in our jewelry products.

Net sales for the Memory Book segment were $292.1 million for the six-month period ended June 28, 2008, an increase of 7.2%, compared to $272.4
million in the same prior year period. The increase was primarily the result of account growth, increased sales driven by new and enhanced product and service offerings and the Publishing Enterprises acquisition.

Net sales of the Marketing and Publishing Services segment increased $31.8 million, or 15.2%, to $240.8 million during the six months ended June 28,
2008 from $209.0 million for the comparable period in 2007. This increase was primarily attributable to higher volumes in our book component business including sales generated by businesses we acquired in 2008 and 2007.

Gross Profit. Gross profit increased $23.9 million, or 5.8%, to $435.4 million for the six months ended June 28, 2008 from $411.5
million for the same period in 2007. As a percentage of net sales, gross profit margin decreased to 53.4% for the six months ended June 28, 2008 from 54.3% for the same period in 2007. The decrease in gross profit margin was
attributable to:



| |  |  | higher precious metal costs and a shift in product mix in our Scholastic segment;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | the write-off of inventory costs associated with the strategic decision to cease the sale of certain scholastic products;
| | - |  | -------------------------------------------------------------------------------------------------------------------------



| |  |  | lower relative margins of businesses acquired; and
| | - |  | --------------------------------------------------



| |  |  | higher depreciation costs.
| | - |  | --------------------------

The
decrease was partially offset by:



| |  |  | increased prices in our Scholastic segment;
| | - |  | -------------------------------------------



| |  |  | increased sales volume and strong operating performance in our Memory Book segment; and
| | - |  | ---------------------------------------------------------------------------------------



| |  |  | favorable product mix in our sampling business.
| | - |  | -----------------------------------------------

Selling and Administrative Expenses. Selling and administrative expenses increased $15.4 million, or 6.6%, to $248.5 million for the six months ended June 28, 2008 from $233.1 million for the
corresponding period in 2007. As a percentage of net sales, selling and administrative expenses decreased 0.3% to 30.5% for the first six months of 2008 from 30.8% for the same period in 2007. This decrease as a percentage of net sales was
primarily due to:



| |  |  | our ability to leverage existing infrastructure while increasing sales; and
| | - |  | ---------------------------------------------------------------------------



| |  |  | the acquisition of businesses that maintain lower selling costs as a percentage of sales.
| | - |  | -----------------------------------------------------------------------------------------

The decrease was partially offset by higher amortization costs and increased commissions and incentive costs to drive higher sales in certain product
offerings, mainly in our Scholastic segment.

Special Charges.Special charges for the six months ended June 28, 2008 included
$1.2 million of costs in the Marketing and Publishing Services segment related to the closure of its Pennsauken, New Jersey facilities, $0.3 million of severance costs reducing headcount by one employee and $0.3 million related to other special
charges for the Marketing and Publishing Services segment. The Scholastic segment incurred $0.8 million of charges associated with the closure of Jostens Attleboro, Massachusetts facility, $0.5 million of severance and related benefits
associated with headcount reductions and $0.4 million of severance and related benefits in connection with the restructuring of its international organization. The Memory Book segment incurred $0.4 million of severance and related benefits
associated with headcount reductions. Special charges for the six months ended June 30, 2007 represent a reversal of less than $0.1 million for severance and related benefit costs associated with headcount reductions in the Scholastic and
Memory Book segments.

Operating Income. As a result of the foregoing, consolidated operating income increased $5.2 million, or
2.9%, to $183.0 million for the six months ended June 28, 2008 from $177.7 million for the comparable period in 2007. As a



41



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percentage of net sales, operating income decreased to 22.5% for the first six months of 2008 from 23.5% for the same period in 2007.

Net Interest Expense.Net interest expense was comprised of the following:



|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|------------------------------------------------------------------- |  | ---------------- | ------ | - | ------------ | - | ------ | -------- |  | - | -------- | - |  | ----- | --
|                                                                    |  | Six months ended |        |   |              |   |        |          | 
|In thousands                                                        |  | June 28,2008     |        |   | June 30,2007 |   |        | $ Change |  |   | % Change |  
|Visant:                                                             |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense                                                    |  | $                | 32,318 |   |              | $ | 43,686 |          |  | $ | (11,368  | ) |  | (26.0 | )%
|Amortization of debt discount, premium and deferred financing costs |  |                  | 2,822  |   |              |   | 11,565 |          |  |   | (8,743   | ) |  | (75.6 | )%
|Interest income                                                     |  |                  | (645   | ) |              |   | (683   | )        |  |   | 38       |   |  | NM    |   
|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Visant interest expense, net                                        |  |                  | 34,495 |   |              |   | 54,568 |          |  |   | (20,073  | ) |  | (36.8 | )%
|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Holdings:                                                           |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense                                                    |  |                  | 15,272 |   |              |   | 15,270 |          |  |   | 2        |   |  | 0.0   | % 
|Amortization of debt discount, premium and deferred financing costs |  |                  | 12,494 |   |              |   | 11,366 |          |  |   | 1,128    |   |  | 9.9   | % 
|Interest income                                                     |  |                  |       |   |              |   | (2     | )        |  |   | 2        |   |  | NM    |   
|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Holdings interest expense, net                                      |  |                  | 27,766 |   |              |   | 26,634 |          |  |   | 1,132    |   |  | 4.3   | % 
|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   
|Interest expense, net                                               |  | $                | 62,261 |   |              | $ | 81,202 |          |  | $ | (18,941  | ) |  | (23.3 | )%
|                                                                    |  |                  |        |   |              |   |        |          |  |   |          |   |  |       |   



NM = Not meaningful

Net interest expense decreased $18.9 million, or 23.3%, to $62.3 million for the six months ended
June 28, 2008 as compared to $81.2 million for the comparable prior year period. The decrease was due to lower outstanding debt balances, reduced amortization and deferred financing costs resulting from early paydown of outstanding debt
obligations and lower average interest rates during the six months ended June 28, 2008 when compared to the same prior year period.

Income Taxes.The Company has recorded an income tax provision for the six months ended June 28, 2008 based on its best estimate of the consolidated effective tax rate applicable for the entire year. The estimated full-year
consolidated effective tax rates for 2008 are 39.0% and 38.3% for Holdings and Visant, respectively, before consideration of the effect of $0.3 million of tax and interest accruals for unrecognized tax benefits and other income tax adjustments
considered a period expense or benefit. The combined effect of the annual estimated consolidated tax rates and the net current-period tax adjustments resulted in effective tax rates of 39.3% and 38.5% for Holdings and Visant, respectively, for the
six-month period ended June 28, 2008. The annual estimated effective tax rates for fiscal year 2008 increased from annual estimates made in the first quarter of 2008 due to the effect in the current quarter of the acquisition of Phoenix Color,
as deductible transaction costs in connection with the acquisition had an unfavorable effect on the Companys domestic manufacturing deduction. Tax and interest accruals considered a period expense or benefit also unfavorably affected the tax
rate.

For the comparable six-month period ended June 30, 2007, the effective rates of income tax expense for Holdings and Visant were
37.5% and 37.1%, respectively. The effective tax rates for the prior year six-month period were more favorable than the tax rates for the six months ended June 28, 2008 due to more favorable state income tax rates and greater benefit from the
domestic manufacturing deduction.

Income from Discontinued Operations.During the second quarter of 2007, we consummated the
sale of the Companys Von Hoffmann businesses, which previously comprised the Educational Textbook segment and a portion of the Marketing



42



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##### Table of Contents

and Publishing Services segment. The sale closed on May 16, 2007 with the Company recognizing net proceeds of $401.8 million and a gain for
financial reporting purposes of $98.4 million on the transaction during the six months ended June 30, 2007. Operations for the Von Hoffmann businesses resulted in income of $11.1 million for the six months ended June 30, 2007.

During the second quarter of 2006, we consummated the sale of our Jostens Photography businesses, which previously comprised a reportable
segment. Results for the six months ended June 30, 2007 for the Jostens Photography businesses included income of $0.4 million.

We also had income of $1.0 million, net of tax, for the six months ended June 30, 2007 from the Jostens Recognition business, which was discontinued in 2001. The income in 2007 resulted from the reversal of an accrual for
potential exposure for which the Company does not believe it is likely to have an ongoing liability.

Net Income.As a result
of the aforementioned items, net income decreased $98.0 million, or 57.2%, to $73.3 million for the six months ended June 28, 2008 compared to net income of $171.3 million for the same period in 2007.

LIQUIDITY AND CAPITAL RESOURCES

The following table
presents cash flow activity of Holdings for the first six months of fiscal 2008 and 2007 and should be read in conjunction with our condensed consolidated statements of cash flows.



|                                                    |  |                  |          |   |              |   |          |  
|--------------------------------------------------- |  | ---------------- | -------- | - | ------------ | - | -------- | -
|                                                    |  | Six months ended |         
|In thousands                                        |  | June 28,2008     |          |   | June 30,2007 |  
|Net cash provided by operating activities           |  | $                | 99,007   |   |              | $ | 107,845  |  
|Net cash (used in) provided by investing activities |  |                  | (243,633 | ) |              |   | 309,822  |  
|Net cash provided by (used in) financing activities |  |                  | 104,581  |   |              |   | (400,000 | )
|Effect of exchange rate change on cash              |  |                  | 427      |   |              |   | 394      |  
|                                                    |  |                  |          |   |              |   |          |  
|(Decrease) increase in cash and cash equivalents    |  | $                | (39,618  | ) |              | $ | 18,061   |  
|                                                    |  |                  |          |   |              |   |          |  

For the six months ended June 28, 2008, operating activities generated cash of $99.0 million
compared with $107.8 million for the same prior year period. Included in cash flows from operating activities was cash provided by discontinued operations of $4.6 million for the six months ended June 30, 2007. Consequently, the cash provided
by continuing operations was $99.0 million and $103.2 million for the respective first six months of 2008 and 2007. The decrease in cash provided by operating activities from continuing operations of $4.2 million was mainly attributable to increased
earnings offset by higher net working capital for the six months ended June 28, 2008 versus the comparable 2007 period.

Net cash used
in investing activities for the six months ended June 28, 2008 was $243.6 million, compared with $309.8 million provided by investing activities for the comparable 2007 period. The $553.4 million decrease was primarily driven by proceeds of
$401.8 million generated from the sale of the Von Hoffmann businesses in the second quarter of 2007. Included in cash flows from investing activities was cash provided by discontinued operations of $396.1 million for the six-month period ended
June 30, 2007. Consequently, the cash used in continuing operations for the six months ended June 28, 2008 and June 30, 2007 was $243.6 million and $86.3 million, respectively. The $157.3 million decrease in cash from investing
activities from continuing operations related primarily to the acquisition of Phoenix Color, including cash on hand of $1.3 million and restrictive covenants with certain key Phoenix Color stockholders, for approximately $222.7 million in cash,
subject to adjustment. The Phoenix Color acquisition was financed with approximately $102.7 million of cash on hand and $120.0 million of borrowings under the Companys revolving line of credit. During the comparable period in 2007 we used
$51.8 million of cash for investing activities for businesses acquired during that period. In addition, our capital expenditures relating to purchases of property, plant and equipment were $21.9 million during the six months ended June 28,
2008, or $14.1 million lower than the comparable 2007 period.

Net cash provided by financing activities for the six months ended
June 28, 2008 was $104.6 million, compared with cash used for financing activities of $400.0 million for the comparable 2007 period. The $504.6 million increase related to the Companys additional voluntary prepayment in the second quarter
of 2007 of $400.0 million on its term loans under its



43



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##### Table of Contents

senior secured credit facilities, including all originally scheduled principal payments due under its term loan C facility for 2007 through mid-2011.
Additionally, the Company increased borrowings under its revolving line of credit during the six-months ended June 28, 2008 in the amount of $103.6 million in connection with the acquisition of Phoenix Color.

During the six months ended June 28, 2008, Visant transferred approximately $16.1 million of cash through Visant Secondary Holdings Corp. to
Holdings to allow Holdings to make scheduled interest payments of $15.3 million on its $350 million 8.75% senior notes due 2013, as well as repurchase common stock from a management stockholder totaling $0.7 million. The repurchase was included in
Holdings condensed consolidated balance sheet as treasury stock, and the transfer was reflected in Visants condensed consolidated balance sheet as a reduction in additional paid-in-capital and presented in Visants condensed
consolidated statement of cash flows as a distribution to stockholder. The transfer amount eliminates in consolidation and had no impact on Holdings consolidated financial statements.

As of June 28, 2008, we had cash and cash equivalents of $20.1 million. Our principal sources of liquidity are cash flows from operating
activities and available borrowings under Visants senior secured credit facilities, which included $130.3 million of additional availability under Visants revolving credit facility as of June 28, 2008. We use cash primarily for
debt service obligations, capital expenditures and to fund other working capital requirements. We intend to fund ongoing operations through cash generated by operations and borrowings under the revolving credit facility.

As a result of the Phoenix Color transaction, we believe the Company will benefit from significant deductible transaction expenses in 2008. In addition,
Phoenix Color has significant net operating loss carryforwards that may be utilized by the Company, subject to certain limitations. As a result, we expect 2008 cash taxes to be $10 to $20 million lower.

As market conditions warrant, we and our Sponsors, including KKR and DLJMBP III and their affiliates, may from time to time redeem or repurchase debt
securities issued by Holdings or Visant in privately negotiated or open market transactions, by tender offer or otherwise. No assurance can be given as to whether or when such repurchases or exchanges will occur and at what price.

As of June 28, 2008, the Company was not aware of any material noncompliance with its financial covenants.

Our ability to make scheduled payments of principal, or to pay the interest on, or to refinance our indebtedness, or to fund planned capital expenditures
will depend on our future performance. Based upon the current level of operations, we believe that cash flows from operations, available cash and short-term investments, together with borrowings available under Visants senior secured credit
facilities, are adequate to meet our liquidity needs for the next twelve months. In addition, based on market and other considerations, we may decide to raise additional funds through debt or equity financings. Furthermore, to the extent we make
future acquisitions, we may require new sources of funding, including additional debt or equity financings or some combination thereof.



|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------

There have been no material changes in our exposure to market risk during the quarter ended June 28, 2008. For additional information, refer to Item 7A of our 2007 Annual Report on Form 10-K.



|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

Not applicable.



|ITEM 4T. | CONTROLS AND PROCEDURES
|-------- | -----------------------

Our management is
responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended (the Exchange Act).

Our management, under the supervision of our Chief Executive Officer and Vice President, Finance, evaluated the effectiveness of our disclosure controls
and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, our Chief Executive Officer and Vice President, Finance concluded that our disclosure controls and
procedures are effective as of the end of the period covered by this report.



44



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##### Table of Contents

On April 1, 2008, we announced the completion of our acquisition of Phoenix Color. Refer to Note 5,
Acquisitions, to the condensed consolidated financial statements for additional information regarding this acquisition. Based on the recent completion of this acquisition, the scope of our assessment of the effectiveness of internal control
over financial reporting as of the end of the period covered by this report does not include Phoenix Color.

During the quarter ended
June 28, 2008, there was no change in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION



|ITEM 1. | LEGAL PROCEEDINGS
|------- | -----------------

The following paragraph contains
a description of the development during the three months ended June 28, 2008 with respect to material pending legal proceedings to which we or any of our subsidiaries are a party.

In the pending proceeding described in Note 12, Commitments and Contingencies, to the Condensed Consolidated Financial Statements, in June 2008,
at the request of U.S. Customs and Border Protection, Jostens agreed to a one-year extension of the waiver of the statute of limitations (previously granted by Jostens in 2006) with respect to the subject entries made in 2002 and 2003 that otherwise
would have expired at the end of 2007 and 2008, respectively.



|ITEM 1A. | RISK FACTORS
|-------- | ------------

There have been no material changes
in our risk factors during the quarter ended June 28, 2008. For additional information, refer to Item 1A of our 2007 Annual Report on Form 10-K.



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

Our equity securities are not registered pursuant to Section 12 of the Exchange Act. For the quarter ended June 28, 2008, we did not issue or sell securities pursuant to offerings that were not registered under the Securities Act
of 1933, as amended (the Securities Act), except as of April 1, 2008, Holdings issued, subject to vesting, an aggregate of 2,600 restricted shares of Holdings Class A Common Stock to three officers of the Company under
the 2004 Plan in accordance with section 4(2) of the Securities Act. In addition, during the second quarter an aggregate of 4,888 shares of Holdings Class A Common Stock were issued in connection with the net cashless exercise of vested
options by two employees in connection with their separation of service. Holdings has the obligation to repurchase such shares in the fourth quarter of 2008 and during the second quarter of 2009.



|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES
|------- | -------------------------------

None.



|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|------- | ---------------------------------------------------

None.



|ITEM 5. | OTHER INFORMATION
|------- | -----------------

None.



|ITEM 6. | EXHIBITS
|------- | --------



|       |  |                                                                                                                
|------ |  | ---------------------------------------------------------------------------------------------------------------
|3.1(1) |  | Second Amended and Restated Certificate of Incorporation of Visant Holding Corp. (f/k/a Jostens Holding Corp.).



45



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##### Table of Contents

|        |  |                                                                                                                                          
|------- |  | -----------------------------------------------------------------------------------------------------------------------------------------
|3.2(2)  |  | Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation of Visant Holding Corp.                         
|        | 
|3.3(3)  |  | By-Laws of Visant Holding Corp.                                                                                                          
|        | 
|3.4(4)  |  | Amended and Restated Certificate of Incorporation of Visant Corporation (f/k/a Jostens IH Corp.).                                        
|        | 
|3.5(2)  |  | Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Visant Corporation.                                 
|        | 
|3.6(4)  |  | By-Laws of Visant Corporation.                                                                                                           
|        | 
|10.1(5) |  | Award Letter to Timothy M. Larson, dated as of April 1, 2008.*                                                                           
|        | 
|10.2(5) |  | Form of Restricted Stock Award Agreement.*                                                                                               
|        | 
|31.1    |  | Certification of President and Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Visant Holding Corp.
|        | 
|31.2    |  | Certification of Vice President, Finance pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Visant Holding Corp.              
|        | 
|31.3    |  | Certification of President and Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Visant Corporation. 
|        | 
|31.4    |  | Certification of Vice President, Finance pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Visant Corporation.               
|        | 
|32.1    |  | Certification of President and Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for Visant Holding Corp.
|        | 
|32.2    |  | Certification of Vice President, Finance pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for Visant Holding Corp.              
|        | 
|32.3    |  | Certification of President and Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for Visant Corporation. 
|        | 
|32.4    |  | Certification of Vice President, Finance pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for Visant Corporation.               



|(1) | Incorporated by reference to Visant Holding Corp.s Form S-4/A (file no. 333-112055), filed on November 12, 2004.
|--- | -----------------------------------------------------------------------------------------------------------------

|(2) | Incorporated by reference to Visant Holding Corp.s Form 10-K, filed on April 1, 2005.
|--- | --------------------------------------------------------------------------------------

|(3) | Incorporated by reference to Visant Holding Corp.s Form S-4/A (file no. 333-112055), filed on February 2, 2004.
|--- | ----------------------------------------------------------------------------------------------------------------

|(4) | Incorporated by reference to Visant Corporations Form S-4 (file no. 333-120386), filed on November 12, 2004.
|--- | -------------------------------------------------------------------------------------------------------------

|(5) | Incorporated by reference to Visant Holding Corp.s Post-Effective Amendment No.1 to Form S-1 (file no. 333  142680) filed on May 20, 2008.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------

|* | Management contract or compensatory plan or arrangement.
|- | --------------------------------------------------------



46



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##### Table of Contents

SIGNATURES

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



|                      |  |                                             
|--------------------- |  | --------------------------------------------
|                      |  | VISANT HOLDING CORP.                        
|                      | 
|Date: August 12, 2008 |  | /s/ Marc L. Reisch                          
|                      |  | Marc L. Reisch                              
|                      |  | President and Chief Executive Officer       
|                      |  | (principal executive officer)               
|                      | 
|Date: August 12, 2008 |  | /s/ Paul B. Carousso                        
|                      |  | Paul B. Carousso                            
|                      |  | Vice President, Finance                     
|                      |  | (principal financial and accounting officer)

SIGNATURES

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



|                      |  |                                             
|--------------------- |  | --------------------------------------------
|                      |  | VISANT CORPORATION                          
|                      | 
|Date: August 12, 2008 |  | /s/ Marc L. Reisch                          
|                      |  | Marc L. Reisch                              
|                      |  | President and Chief Executive Officer       
|                      |  | (principal executive officer)               
|                      | 
|Date: August 12, 2008 |  | /s/ Paul B. Carousso                        
|                      |  | Paul B. Carousso                            
|                      |  | Vice President, Finance                     
|                      |  | (principal financial and accounting officer)