SEC – ‘UPLOAD’ from 2/24/06 re: Pregis Holding II Corp, et al. – ‘LETTER’

On:  Friday, 2/24/06, at 9:35am ET   ·   Private-to-Public:  Filing ¶  –  Release Delayed to:  7/16/10   ·   Accession #:  0-6-9477

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Delayed-Release Comment or Other Letter from the SEC
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: LETTER      Comment or Other Letter from the SEC                   5±    22K 


Mail Stop 7010                                                                  

February 24, 2006                                                               

Via U.S. mail and facsimile                                                     

Mr. Vincent P. Langone                                                          
Chief Executive Officer                                                         
Pregis Corporation                                                              
1900 West Field Court                                                           
Lake Forest, IL 60045                                                           

Re:     Pregis Corporation                                                      
Amendment No. 1 to Registration Statement on Form S-4                           
Filed February 14, 2006                                                         
File No. 333-130353 and 333-130353-01 through 04                                

Dear Mr. Langone:                                                               

We have reviewed your amended filing and your response and          
have                                                                            
the following comments.  We welcome any questions you may have                  
about                                                                           
our comments or any other aspect of our review.  Feel free to call              
us                                                                              
at the telephone numbers listed at the end of this letter.                      

Collateral for Senior Secured Floating Rate Notes, page 8                       

1. We note your tabular presentation is introduced as the capital               
stock which constitutes collateral for the senior secured floating              
rate notes.  Given the threshold limitations please provide an                  
additional column in your table which highlights the maximum                    
amount                                                                          
of book value and market value which is included in the collateral              
pool.                                                                           

Summary Historical Financial and Other Data, page 12                            

2. We note your revised disclosures provided in response to                     
comment                                                                         
15 of our letter dated January 12, 2006 and have the following                  
additional comments:                                                            

* With regard to your discussion of the material limitations                    
associated with EBITDA, it is unclear to us why you have presented              
the last two bullets (e.g. discussion of cash expenditures and                  
cash                                                                            
requirements of your working capital needs) as limitations of a                 
non-                                                                            
GAAP operating performance measure.                                             

* It is unclear to us why, given the fact that you use and discuss              
EBITDA in the context of assessing your operating performance, it               
is                                                                              
necessary to tell investors that EBITDA should not be considered                
as a                                                                            
measure of discretionary cash as you do in the penultimate                      
paragraph                                                                       
on page 14.                                                                     

* It is unclear to us how your utilization of GAAP cash flow                    
information helps you to compensate for the material limitations                
of                                                                              
your non-GAAP operating performance measure.                                    

Please revise your disclosures accordingly.                                     

Note (3) to the Unaudited Pro Forma Condensed Balance Sheet, page               
35                                                                              

3. We note your response to comments 26 and 27 of our letter dated              
January 12, 2006.  Please disclose the fact that the US employees               
of                                                                              
GPP ceased to participate in Pactiv`s plan upon consummation of                 
the                                                                             
acquisition and post acquisition will be able to participate in                 
the                                                                             
401(k) plan of Pregis.  Further disclose the impact you believe                 
the                                                                             
pension plan and the various agreements with Pactiv will have on                
your                                                                            
proforma statements as you have discussed in your responses to                  
comments 26 and 27 of our letter dated January 12, 2006.                        

Use of Adjusted EBITDA, page 55                                                 

4. We note your response to comment 36 of our letter dated January              
12, 2006 and your revised disclosure.  We note that you continue                
to                                                                              
discuss Adjusted EBITDA as a performance measure and have the                   
following comments in this regard:                                              

* We note that your Adjusted EBITDA measure eliminates various                  
items                                                                           
that appear to be recurring or reasonably likely to recur in                    
within                                                                          
two years.  In this regard, it is unclear how your Adjusted EBITDA              
measure meets the requirements on Item 10(e)(1)(ii) of Regulation               
S-                                                                              
K.                                                                              

* Notwithstanding the above bullet, it is unclear to us, if you                 
are                                                                             
able to demonstrate the appropriateness of Adjusted EBITDA as a                 
performance measure, why you have presented the discussion                      
surrounding Adjusted EBITDA as a performance measure within the                 
liquidity and capital resources section of your Management`s                    
Discussion and Analysis.  Also see our comment above as it relates              
to                                                                              
your EBITDA discussion.                                                         
Combined Statements of Cash Flows, page F-5                                     

5. We note your response to comment 64 of our letter dated January              
12, 2006 and your revised disclosure.  Based on your response, it               
is                                                                              
unclear to us why the $14,225 of corporate allocations is not                   
reflected as an adjustment to reconcile your income to cash                     
provided                                                                        
by operating activities.  In this regard, it appears that although              
these allocations have been reflected for the purpose of these                  
financial statements you did not reimburse Pactiv for providing                 
such                                                                            
services.  In addition, it is also unclear to us why $24,861 of                 
intercompany settlements are reflected within your financing                    
activities of your statement of cash flows since you indicate in                
your                                                                            
response that you did not receive cash from Pactiv for the Pactiv               
receivables and your payables to Pactiv are forgiven.  Clarify why              
these intercompany settlements are not more appropriately                       
discussed                                                                       
and disclosed as non-cash transactions in accordance with                       
paragraph                                                                       
32 of SFAS 95.                                                                  

Note 13.  Segment and Geographic Information, page F-22                         

6. We note your response to comment 68 of our letter dated January              
12, 2006 with regard to the aggregation of Hexacomb within your                 
Protective Packaging reportable segment.  Your response indicates               
that Hexacomb and your Protective Packaging segment have similar                
economic characteristics, including similar gross margins.  Please              
provide for us the financial information that is provided to the                
CODM                                                                            
which shows sales and gross margins for each operating segment for              
each of the last 5 years.   Please address for us any                           
inconsistencies                                                                 
between the trends they depict.                                                 

We further note that your current disclosure does not indicate                  
that                                                                            
Hexacomb is aggregated with your Protective Packaging segment as                
required in paragraph 26 of SFAS 131.  Please revise your                       
disclosure                                                                      
to discuss the factors used to identify the Company`s reportable                
segments.                                                                       

Exhibit 5.1                                                                     

7. We note that Hexacomb Corporation is incorporated in the State               
of                                                                              
Illinois.  We also note that the opinion does not cover Illinois                
corporate law.  In this regard, we note the qualifications set                  
forth                                                                           
in clauses (ii) and (iii) of the fifth paragraph and the first                  
sentence of the third last paragraph.  Please be advised that the               
opinion may not exclude the corporate laws of the jurisdiction of               
incorporation of a guarantor.  Matters governed by corporate law,               
such as having the authority to enter into the indentures,                      
guarantees                                                                      
and notes, impact the binding nature of the parties` obligations.               
Please have counsel revise its opinion accordingly.                             

8. We note that the opinion is dated as of February 14, 2006.  We               
also note that the opinion is qualified by assumptions made as of               
that date.  In this regard, we note the disclosure in the last                  
sentence of the third last paragraph.  Please have counsel revise               
its                                                                             
opinion to clarify that it speaks through the effective date of                 
your                                                                            
registration statement.  Counsel can do this by either revising                 
its                                                                             
opinion or by filing another opinion dated the date of                          
effectiveness.                                                                  

9. We note the statement in the last paragraph that the opinion                 
"may                                                                            
not be relied on in any manner or for any purpose by any other                  
person                                                                          
or entity."  Please be advised that security holders are entitled               
to                                                                              
rely on the opinion.  Please have counsel revise its opinion                    
accordingly.                                                                    

*       *       *       *                                                       

As appropriate, please amend your registration statement in         
response to these comments.  You may wish to provide us with                    
marked                                                                          
copies of the amendment to expedite our review.  Please furnish a               
cover letter that is filed on EDGAR with your amendment that keys               
your responses to our comments and provides any requested                       
information.  Detailed cover letters greatly facilitate our                     
review.                                                                         
Please understand that we may have additional comments after                    
reviewing your amendment and responses to our comments.                         

You may contact Melissa Rocha, Staff Accountant, at (202)           
551-                                                                            
3854 or, in her absence, Jeanne Baker, Assistant Chief Accountant,              
at                                                                              
(202) 551-3691 if you have any questions regarding comments on the              
financial statements and related matters.  Please contact Andrew                
Schoeffler, Staff Attorney, at (202) 551-3748 or, in his absence,               
Chris Edwards, Special Counsel, at (202) 551-3742 with any other                
questions.                                                                      

Sincerely,                                                                      

Pamela A. Long                                                                  
Assistant Director                                                              

cc:     Mr. Michael A. Levitt                                                   
Fried, Frank, Harris, Shriver & Jacobson LLP                                    
One New York Plaza                                                              
New York, NY 10004                                                              
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Mr. Vincent P. Langone                                                          
Pregis Corporation                                                              
February 24, 2006                                                               
Page 1                                                                          

UNITED STATES                                                                   
SECURITIES AND EXCHANGE COMMISSION                                              
WASHINGTON, D.C. 20549-7010                                                     

DIVISION OF                                                   
CORPORATION FINANCE                                                         

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘UPLOAD’ Filing		Date		Other Filings
Release Delayed to:		7/16/10		CORRESP,  UPLOAD
Filed on:		2/24/06		UPLOAD
		2/14/06		S-4/A,  UPLOAD
		1/12/06		UPLOAD
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1 Previous Filing that this Filing References

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/14/06  Pregis Corp.                      S-4/A¶                50:10M                                    Donnelley … Solutions/FA