Packaging Corp of America (PKG) 10-K risk factor changes: FY2021 vs FY2020

For our discussion and analysis of our results of operations, financial condition and cash flows for the year ended December 31, [removed: 2018,] [added: 2019,] the earliest of the years presented in the accompanying audited financial statements included in Item 8 herein, please refer to our Annual Report on Form 10-K for the year ended December 31, [removed: 2019,] [added: 2020,] filed with the Securities and Exchange Commission on February [removed: 26, 2020.][added: 24, 2021.]

Such information is presented in Item 7 of such report under the subcaptions “Results of Operations —Year Ended December 31, [removed: 2019,] [added: 2020,] Compared with Year Ended December 31, [removed: 2018”] [added: 2019”] and “Liquidity and Capital Resources” and is incorporated by reference herein.

PCA is the third largest producer of containerboard products and [removed: the third largest] [added: a leading] producer of uncoated freesheet paper in North America.

We operate [removed: six containerboard mills, two paper mills,] [added: eight mills] and 90 corrugated products manufacturing plants.

[removed: Executive Summary][added: Executive Summary]

Net sales were [removed: $6.66] [added: $7.73] billion for the year ended December 31, [removed: 2020] [added: 2021] and [removed: $6.96] [added: $6.66] billion in [removed: 2019.][added: 2020.]

We reported [removed: $461] [added: $841] million of net income, or [removed: $4.84] [added: $8.83] per diluted share, in [removed: 2020,] [added: 2021,] compared to [removed: $696] [added: $461] million, or [removed: $7.34] [added: $4.84] per diluted share, in [removed: 2019.][added: 2020.]

Net income included [removed: $89] [added: $53] million of expense for special items in [removed: 2020,] [added: 2021,] compared to [removed: $29] [added: $89] million of expense for special items in [removed: 2019.][added: 2020.]

Excluding special items, we recorded [removed: $550] [added: $894] million of net income, or [removed: $5.78] [added: $9.39] per diluted share, in [removed: 2020,] [added: 2021,] compared to [removed: $726] [added: $550] million, or [removed: $7.65] [added: $5.78] per diluted share, in [removed: 2019.][added: 2020.]

The [removed: decrease] [added: increase] was driven primarily by [removed: lower] [added: higher] prices and mix in our Packaging and Paper [removed: segments, lower] [added: segments and higher] volumes in our [removed: Paper] [added: Packaging] segment, [added: partially offset by] higher [removed: freight and logistic expense,] [added: operating] and [added: converting costs,] higher annual outage expense, [removed: partially offset by higher] [added: lower] volumes in our [removed: Packaging] [added: Paper] segment, and [removed: lower operating] [added: higher freight] and [removed: converting costs.][added: logistic expense.]

Reconciliations of Non-GAAP Financial Measures to Reported Amounts.” PCA ended the year with [removed: $1.1 billion] [added: $765 million] of cash and marketable debt securities and, including borrowing availability under its revolving credit facility, [removed: $1.4] [added: $1.1] billion in liquidity.

Packaging segment income from operations was [removed: $830] [added: $1,306] million in [removed: 2020,] [added: 2021,] compared to [removed: $963] [added: $830] million in [removed: 2019.][added: 2020.]

Packaging segment EBITDA excluding special items was [removed: $1,229] [added: $1,688] million in [removed: 2020,] [added: 2021,] compared to [removed: $1,310] [added: $1,229] million in [removed: 2019.][added: 2020.]

The [removed: decrease] [added: increase] was driven primarily by [removed: lower] [added: higher] containerboard and corrugated [added: products] prices and [removed: mix, partially offset by] [added: mix and] higher sales and production volumes, [removed: lower] [added: partially offset by higher] operating and converting costs, [removed: lower] [added: higher] annual outage expense, and [removed: lower] [added: higher] freight and logistic expenses.

Paper segment [removed: loss] [added: income] from operations was [removed: $20] [added: $39] million in [removed: 2020,] [added: 2021,] compared to [removed: income] [added: a loss] of [removed: $175] [added: $20] million in [removed: 2019.][added: 2020.]

Paper segment EBITDA excluding special items was [removed: $73] [added: $72] million in [removed: 2020,] [added: 2021,] compared to [removed: $213] [added: $73] million in [removed: 2019.][added: 2020.]

The decrease was due primarily to lower sales and production [removed: volumes, lower paper prices and mix, higher annual outage expense,] [added: volumes] and higher freight and logistic expenses, partially offset by lower operating [removed: costs.][added: costs, lower annual outage expense, and higher paper prices and mix.]

As described in Note [removed: 8,] [added: 9,] Goodwill and Intangible Assets included in Item 8 of this Annual Report on Form 10-K, we incurred a charge of $55.2 million during [removed: the year] [added: 2020] associated with the full impairment of goodwill within the Paper segment.

[removed: Special] [added: *Special] Items and Earnings per Diluted Share, Excluding Special [removed: Items][added: Items*]

Earnings per diluted share, excluding special items, in [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] were as follows:

| | | [removed: Year] [added: Year] Ended December [removed: 31,] [added: 31,] | | | | | | |

| Earnings per diluted share | | $ | [removed: 4.84] [added: 8.83] | | | $ | [removed: 7.34] [added: 4.84] | |

| Goodwill impairment [removed: (a)] [added: (e)] | | | [removed: 0.58] [added: —] | | | | [removed: —] [added: 0.58] | |

| Facilities closure and other costs [removed: (b)] [added: (income) (a)] | | | [removed: 0.23] [added: (0.03] | [added: )] | | | [removed: —] [added: 0.23] | |

| Hurricane Laura impact [removed: (c)] [added: (f)] | | | [removed: 0.08] [added: —] | | | | [removed: —] [added: 0.08] | |

| Incremental costs for COVID-19 [removed: (d)] [added: (g)] | | | [removed: 0.05] [added: —] | | | | [removed: —] [added: 0.05] | |

| Debt refinancing [removed: (e)] [added: (b)] | | | [removed: —] [added: 0.47] | | | | [removed: 0.28] [added: —] | |

| Total special items expense | | | [removed: 0.94] [added: 0.56] | | | | [removed: 0.31] [added: 0.94] | |

| Earnings per diluted share, excluding special items | | $ | [removed: 5.78] [added: 9.39] | | | $ | [removed: 7.65] [added: 5.78] | |

[removed: | (a) |] During the second quarter of 2020, with the exacerbated deterioration in uncoated freesheet market conditions and the estimated impact on our Paper reporting unit arising from the COVID-19 pandemic, as well as projected future results of operations, we identified a triggering event indicating possible impairment of goodwill within our Paper reporting unit. [removed: The Company performed an interim quantitative impairment analysis as of May 31, 2020, and, based on the evaluation performed, we determined that goodwill was fully impaired for the Paper reporting unit and recognized a non-cash impairment charge of $55.2 million. |]

[removed: | (b) | Includes] [added: For 2020, includes] $28.1 million of restructuring costs for paper administrative functions and closure costs related to corrugated products facilities, substantially all of which relates to the previously announced closure of the San Lorenzo, California facility during the second quarter of 2020, partially offset by income related to the sale of a corrugated products facility during the second quarter of 2020. [removed: |]

[removed: | (c) |] Includes $10.0 million of charges related to the impact of Hurricane Laura at our DeRidder, Louisiana mill, including unabsorbed costs related to lost production, excess purchased containerboard and freight costs, repair expenses, rental and supplies costs, and other recovery expenses. [removed: |]

[removed: | (g) |] Includes [removed: $1.0] [added: $14.0] million of charges related to the [added: announced] discontinuation of [added: production of] uncoated [removed: free sheet and coated one-side] [added: freesheet] paper grades [added: on the No. 3 machine] at the [removed: Wallula, Washington] [added: Jackson, Alabama] mill associated with the [added: permanent] conversion of the [removed: No. 3 paper] machine to produce [removed: virgin kraft linerboard. |][added: linerboard and other paper-to-containerboard conversion related activities.]

[removed: Industry] [added: Industry] and [removed: Business Conditions][added: Business Conditions]

Trade publications reported North American industry-wide corrugated products shipments per workday were up [removed: 3.0%] [added: 2.8%] during [removed: 2020,] [added: 2021,] compared to [removed: 2019.][added: 2020.]

Reported industry containerboard production increased [removed: 3.6%] [added: 5.6%] compared to [removed: 2019,] [added: 2020,] and reported industry containerboard inventories at the end of [removed: 2020] [added: 2021] were approximately [removed: 2.3] [added: 2.8] million tons, [removed: down 8.9%] [added: up 19.5%] compared to [removed: 2019.][added: 2020.]

Reported containerboard export shipments increased [removed: 9.0%] [added: 9.9%] compared to [removed: 2019.][added: 2020.]

Trade publications reported North American uncoated freesheet paper shipments were down [removed: 20.1%] [added: 0.4%] in [removed: 2020,] [added: 2021,] compared to [removed: 2019.][added: 2020.]

Average [removed: copy paper] prices reported by a trade publication for cut size office papers [removed: decreased $15] [added: increased $20] per ton in [removed: May 2020 and $20] [added: March 2021, $40] per ton in [added: April 2021, $30 per ton in] June [removed: 2020.][added: 2021, $30 per ton in July 2021, and $80 per ton in November 2021.]

[removed: Year] [added: Year] Ended December 31, [removed: 2020,] [added: 2021,] Compared with Year Ended December 31, [removed: 2019][added: 2020]

Overview

Demand for Packaging segment products remained strong throughout the year, with record-setting shipments from our corrugated products and record containerboard production.

We also continued to experience cost inflation across our business, including in the areas of labor and benefits, recycled fiber, energy, repairs, materials, and supplies, as well as higher transportation costs, driven by higher fuel costs, tight rail supply, driver and truck shortages, and higher spot prices.

We have experienced some workforce availability issues late in the year and early in 2022 due to the spread of the Omicron variant, as well as effects from supply chain and transportation service disruptions, but we have generally been able to manage through these issues such that our operations have not been materially disrupted.

We continue to deploy capital to improve productivity and efficiencies at our facilities and believe that our success in doing so is helping us to manage cost inflation and better serve our customers.

Sales and production volumes in the Paper segment significantly declined after the first quarter of 2020 as the COVID-19 pandemic caused lower demand for our paper products.

During the second and third quarters of 2020, in response to such lower demand, we temporary idled both machines at our Jackson, Alabama mill.

During the fourth quarter of 2020, in order to meet strong packaging demand and maintain appropriate inventory levels in the Packaging segment, we temporarily began producing linerboard on the No. 3 machine at the mill, and we have produced linerboard on the machine since that time.

In the first quarter of 2021, we announced the discontinuation of production of uncoated freesheet paper grades on the machine and the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.

Demand for paper products has improved since the beginning of the pandemic, but our sales and production in the Paper segment will remain below pre-pandemic levels as we will no longer be producing paper products on the machine.

Later in 2021, we began to produce corrugating medium on the No. 1 machine at the Jackson mill (which had produced uncoated freesheet paper in the past) to help satisfy our demand for containerboard, build necessary inventories, and evaluate the capability of the machine to produce containerboard on a cost-effective basis.

We expect to continue to produce corrugating medium on the machine for the foreseeable future.

On December 10, 2021, we completed the acquisition of the assets of Advance Packaging Corporation, an independent corrugated products producer, for a cash purchase price of $195 million, including a purchase price adjustment based upon net working capital.

Advance Packaging is a full-service producer of corrugated packaging products, including graphics, retail displays, sustainable shipping containers, and protective packaging.

Advance Packaging owns and operates a 500,000 square foot corrugated products facility in Grand Rapids, Michigan.

The operating results of Advance Packaging are included in PCA's results after the date of acquisition.

The acquisition is consistent with our historical growth strategy and will provide additional integration of containerboard we produce into our own corrugated products facilities.

| Jackson mill conversion-related activities (c) | | 0.11 | | | | | — | |

| Acquisition and integration related costs (d) | | 0.01 | | | | | — | |

(a)

For 2021, includes $3.6 million of income primarily consisting of an adjustment of the required asset retirement obligation related to the 2020 closure of the San Lorenzo, California facility, a gain on sale of transportation assets and corrugated products facilities, and insurance proceeds received for a natural disaster at one of the corrugated products facilities, partially offset by closure costs related to corrugated products facilities.

(b)

Includes $58.9 million of costs related to the Company's debt refinancing completed in October 2021, which included a redemption premium and the write-off of the remaining balance of unamortized debt issuance costs.

(c)

(d)

Includes $0.9 million of charges for acquisition and integration costs related to the December 2021 Advance Packaging Corporation acquisition.

(e)

The Company performed an interim quantitative impairment analysis as of May 31, 2020, and, based on the evaluation performed, we determined that goodwill was fully impaired for the Paper reporting unit and recognized a non-cash impairment charge of $55.2 million.

(f)

(g)

Includes $6.9 million of incremental, out-of-pocket costs related to COVID-19, including supplies, cleaning and sick pay.

Beginning in July 2020, all corresponding COVID-19 related expenses were included in normalized costs.

Prices reported by trade publications increased by $20 per ton for linerboard and $30 per ton for corrugating medium in March 2021, $40 per ton for linerboard and corrugating medium in April 2021, and a further $50 per ton for linerboard and $60 per ton for corrugating medium in August 2021.

Outlook

For the first quarter of 2022, in the Packaging segment, we expect higher corrugated products volume than the fourth quarter of 2021, driven by continued strong demand and three additional shipping days, along with slightly higher domestic and export containerboard sale prices and mix.

Earlier in the first quarter, we notified our customers of a $70 per ton price increase for all of our linerboard and corrugating grades.

We do not expect to realize significant benefits of this price increase during the first quarter of 2022.

In our Paper segment, we expect higher prices and mix from price increases previously communicated to customers during the fourth quarter and earlier in the first quarter of 2022.

We expect maintenance outage expenses in the first quarter to be lower than the fourth quarter.

We also expect continued cost inflation to persist at higher than historical levels across our mills, converting plants, and other operations as well as freight and logistics expenses.

| --- | --- |

Overview

The Company was committed to conducting safe operations through the COVID-19 pandemic during the year in adherence with the guidelines of the Center for Disease Control and applicable health and safety regulations.

As PCA’s operations continued to operate as “essential businesses,” we adopted measures to protect the health and safety of our employees, including social distancing practices, enhanced sanitation procedures and modified absence pay policies.

These practices will continue into 2021 as the effects of the pandemic continue.

PCA did not experience significant disruptions in its operations as a result of the pandemic and has maintained adequate availability of its workforce and supply of raw materials and services to continue to serve its customers.

Demand for Packaging segment products remained strong throughout the year, with our corrugated products shipments up 5.8% over 2019 (an increase of 5.4% on a per day basis as 2020 had one more operating day than 2019) and is expected to remain strong into the first quarter of 2021.

We notified our customers of increased prices on our containerboard and corrugated products

during the fourth quarter of 2020.

We expect to incur some inflation in freight, labor, energy and fiber costs into the first quarter of 2021.

Sales were 30% lower than last year, as demand for our paper products has continued to be negatively affected by the COVID-19 pandemic due to office and school closures.

Operations at our Jackson, Alabama mill were idled for the majority of the second and third quarters of 2020.

During the fourth quarter of 2020, due to an increase in demand for our corrugated products and as part of our assessment of a potential conversion to produce containerboard, we began producing high-performance, virgin kraft linerboard on the No. 3 machine at our Jackson mill.

We expect to continue to produce containerboard on the Jackson machine during the first quarter of 2021 to fulfill the needs of our packaging customers, as well as produce uncoated freesheet to service our paper customers.

During the second quarter of 2018, the Company discontinued production of paper grades at its Wallula, Washington mill and converted the No. 3 paper machine to a virgin kraft linerboard machine.

The Company incurred charges in the Packaging and Paper segments relating to these activities during 2019 as described below under “Special Items and Earnings per Diluted Share, Excluding Special Items.”

| | | 2020 | | | | 2019 | | |

| DeRidder mill fixed asset disposals (f) | | | — | | | | 0.02 | |

| Wallula mill restructuring (g) | | | — | | | | 0.01 | |

| (d) | Includes $6.9 million of incremental, out-of-pocket costs related to COVID-19 that were incurred in the first half of 2020. Costs include materials, cleaning supplies, and sick pay as well as expenses for establishing processes and logistics for the new work requirements in all of our facilities for mitigating the spread of the virus within the Company. With the |

| | process now established, we anticipate any corresponding COVID-19 related expenses to be included in normalized costs through the span of the pandemic. |

| (e) | Includes $38.7 million of charges related to the Company’s November 2019 debt refinancing, which included premiums paid to redeem the debt being refinanced and the write-offs of remaining balances of treasury locks and unamortized debt issuance costs. Also includes $3.2 million of income tax benefit from the stranded tax effects in Accumulated Other Comprehensive Income related to the write-offs of the treasury locks in connection with the debt refinancing. |

| (f) | Includes $3.0 million of charges for the disposal of fixed assets related to the containerboard mill conversion at our DeRidder, Louisiana mill. |

Prices reported by trade publications decreased by $10 per ton for linerboard and $15 per ton for corrugating medium in January 2020, followed by a $50 per ton increase in linerboard and medium in November 2020.

| Packaging | | $ | 5,919.5 | | | $ | 5,932.2 | | | $ | (12.7 | ) |

| Paper | | | 674.8 | | | | 964.3 | | | | (289.5 | ) |

| Packaging | | $ | 829.5 | | | $ | 963.4 | | | $ | (133.9 | ) |

| Paper | | | (20.0 | ) | | | 175.4 | | | | (195.4 | ) |

| --- | --- | --- |

Net sales decreased $306 million, or 4.4%, to $6,658 million in 2020, compared to $6,964 million in 2019.

Packaging.

Net sales decreased $13 million, or 0.2%, to $5,919 million, compared to $5,932 million in 2019, due to lower prices and mix ($298 million), partially offset by increased volumes ($285 million), primarily due to strong corrugated products demand and shipments.

Prices reported by trade publications, which serve as an index for prices for our corrugated products in many of our customer contracts, decreased by $10 per ton for linerboard and $15 per ton for corrugating medium in January, followed by a $50 per ton increase in linerboard and medium in November 2020.

Paper.

The decrease was due to lower volume ($262 million) and prices and mix ($27 million), as demand was harmed by the COVID-19 pandemic due to office and school closures.

Gross profit decreased $275 million in 2020, compared to 2019.

The decrease was primarily due to lower travel and entertainment expenses and lower administrative and other corporate costs, partially offset by higher employee salaries and fringes.

| Wallula mill restructuring | | | — | | | | (0.7 | ) |

2019 special items included $3 million of charges for the disposal of fixed assets related to the containerboard mill conversion at our DeRidder, Louisiana mill and $1 million of charges related to the conversion of the Wallula, Washington mill No. 3 paper machine.

Special items in 2019 included $3 million for the disposal of fixed assets related to the containerboard mill conversion at our DeRidder, Louisiana mill and $1 million of charges related to the conversion of the Wallula No. 3 paper machine.

We were not party to any derivative-based arrangements at December 31, [removed: 2020.][added: 2021.]

For a discussion of derivatives and hedging activities, see Note [removed: 15,] [added: 16,] Derivative Instruments and Hedging Activities, of the Notes to Consolidated Financial Statements in “Part II, Item 8.

At December 31, [removed: 2020,] [added: 2021,] the interest rates on 100% of PCA’s outstanding debt are fixed.

| --- | --- |

Packaging Corporation of America (“we,” “us,” “our,” “PCA,” or the “Company”) is the third largest producer of containerboard products and [removed: the third largest] [added: a leading] producer of uncoated freesheet (UFS) paper in North America.

For segment financial information see Note [removed: 19,] [added: 20,] Segment Information, of the Notes to Consolidated Financial Statements in “Part II, Item 8, Financial Statements and Supplementary Data” of this Form 10-K.

[removed: Production] [added: Production] and [removed: Shipments][added: Shipments]

| | | | | | | [removed: First Quarter] [added: First Quarter] | | | | [removed: Second Quarter] [added: Second Quarter] | | | | [removed: Third Quarter] [added: Third Quarter] | | | | [removed: Fourth Quarter] [added: Fourth Quarter] | | | | [removed: Full Year] [added: Full Year] | | |

| [removed: Containerboard Production] [added: (thousand tons)] | | | 2020 | | | | 1,047 | | | | 1,072 | | | | 1,048 | | | | 1,174 | | | | 4,341 | |

| [removed: (thousand tons)] | | | 2019 | | | | 1,037 | | | | 1,063 | | | | 1,070 | | | | 1,079 | | | | 4,249 | |

| [removed: Corrugated Shipments (BSF)] | | | 2020 | | | | 15.3 | | | | 15.1 | | | | 16.0 | | | | 16.4 | | | | 62.8 | |

| [removed: UFS Production] [added: (thousand tons)] | | | 2020 | | | | 224 | | | | 148 | | | | 129 | | | | 147 | | | | 648 | |

| [removed: (thousand tons)] | | | 2019 | | | | 239 | | | | 236 | | | | 236 | | | | 236 | | | | 947 | |

[removed: ][added: ]

[removed: Packaging][added: Packaging Products]

Our containerboard mills produce linerboard and corrugating medium, which are [added: papers] primarily used in the production of corrugated products.

During the year ended December 31, [removed: 2020,] [added: 2021,] our Packaging segment produced [removed: 4.3] [added: 4.9] million tons of containerboard at our mills.

Our corrugated products manufacturing plants sold [removed: 62.8] [added: 65.7] billion square feet (BSF) of corrugated products.

The Packaging segment’s net sales to third parties totaled [removed: $5.9] [added: $7.1] billion in [removed: 2020.][added: 2021.]

We manufacture containerboard, which includes a variety of performance and specialty grades, at [removed: six] [added: our] containerboard mills.

Total annual containerboard capacity was approximately [removed: 4.3] [added: 5.0] million tons as of December 31, [removed: 2020.][added: 2021.]

The following provides more details of our [removed: operations:][added: primary operating facilities:]

[added: *Counce.*] Our Counce, Tennessee mill produces kraft linerboard on two machines.

[added: *DeRidder.*] Our DeRidder, Louisiana mill produces kraft linerboard on its No. 1 machine and kraft linerboard and corrugating medium on its No. [removed: 2] [added: 3] machine.

[added: *Valdosta.*] Our Valdosta, Georgia mill produces kraft linerboard on one machine.

[added: *Tomahawk.*] Our Tomahawk, Wisconsin mill produces corrugating medium on two machines.

[added: *Filer City.*] Our Filer City, Michigan mill produces corrugating medium on three machines.

[added: *Wallula.*] Our Wallula, Washington mill produces corrugating medium on its No. 2 machine and kraft linerboard on its No. 3 machine.

Of the 90 manufacturing facilities, [removed: 58] [added: 59] operate as combining operations, commonly called corrugated plants, which manufacture corrugated sheets and finished corrugated packaging products, [removed: 31] [added: 30] are sheet plants, which procure combined sheets and manufacture finished corrugated packaging products, and one is a corrugated sheet-only manufacturer.

Each of our plants [removed: serve] [added: serves] a market radius of approximately 150 miles.

[removed: Major] [added: Major] Raw Materials [removed: Used][added: Used]

[added: *Fiber supply.*] Fiber is the largest raw material cost to manufacture containerboard.

We consume both [added: virgin] wood fiber and recycled fiber in our containerboard [removed: mills.][added: mills, and all of our fiber comes from renewable resources.]

In [removed: 2020,] [added: 2021,] our usage of recycled fiber, net of internal generation, represents [removed: 17%] [added: 18%] of our containerboard production.

[removed: We] [added: As part of our renewable virgin fiber sourcing efforts, we] participate in the Sustainable Forestry Initiative® (SFI), the Programme for the Endorsement of Forest Certification (PEFC), as well as the Forest Stewardship Council® (FSC®), and we are certified under their sourcing and chain of custody standards.

In [removed: 2020,] [added: 2021,] our packaging mills consumed about [removed: 74] [added: 81] million MMBTUs of fuel to produce both steam and electricity.

Of the [removed: 74] [added: 12] million MMBTUs consumed, about [removed: 63%] [added: 75%] was from [removed: mill generated] [added: mill-generated biogenic fuels that are] by-products [added: of the manufacturing] and [removed: 37%] [added: pulping process and 25%] was from purchased fuels.

Of the purchased fuels, [removed: 78%] [added: 81%] was from natural gas, [removed: 20%] [added: 18%] was from purchased wood waste and [removed: 2%] [added: 1%] was from other purchased fuels.

[added: *Chemical supply.*] We consume various chemicals in the production of containerboard, including caustic soda, sulfuric acid, soda ash, and lime.

[removed: Sales,] [added: Sales,] Marketing, and [removed: Distribution][added: Distribution]

[removed: Customers][added: Customers]

We sell containerboard and corrugated products to approximately [removed: 16,000] [added: 15,000] customers in approximately 33,000 locations.

The primary end-use markets in the United States for corrugated products are shown below as reported in the [removed: 2019] [added: 2020] Fibre Box Association annual report:

| Food, beverages, and agricultural products | | | [removed: 45] [added: 44] | % |

We operate eight mills and 90 corrugated products plants and related facilities.

| | | | | | | | | | | | | | | | | | | | | | | | | |

| Containerboard Production | | | 2021 | | | | 1,195 | | | | 1,193 | | | | 1,256 | | | | 1,243 | | | | 4,887 | |

| Corrugated Products Shipments (billion square feet) | | | 2021 | | | | 16.4 | | | | 16.5 | | | | 16.4 | | | | 16.4 | | | | 65.7 | |

| UFS Production | | | 2021 | | | | 145 | | | | 149 | | | | 148 | | | | 130 | | | | 572 | |

Packaging

Our products are sustainable and are produced from renewable raw materials, predominately using energy derived from biogenic fuels in our production processes and are recyclable at end-of-life.

*Jackson.* Our Jackson, Alabama mill produces kraft linerboard on its No. 3 machine and, beginning in the third quarter of 2021, we began producing corrugating medium on its No. 1 machine.

Jackson had historically operated as a UFS paper mill, with its results of operations reported in our Paper segment.

During the fourth quarter of 2020, in order to meet strong packaging demand and maintain appropriate inventory levels, we temporarily began producing linerboard on the No. 3 machine and, in the first quarter of 2021, we announced the discontinuation of producing uncoated freesheet paper grades on the machine and the permanent conversion of the machine to produce linerboard.

Jackson remains capable of producing white paper grades on the No. 1 and No. 3 machines.

In order to improve our fiber flexibility and production capabilities, we have invested in additional capacity to process recycled fiber at our DeRidder, Wallula, and Jackson mills.

We have experienced higher freight costs in 2021 due to truck and driver shortages and limited boxcar availability, as well as fuel surcharges.

| | | | | |

Paper

Our products are sustainable and are produced from renewable raw materials, predominately using energy derived from biogenic fuels in our production processes and are recyclable at end-of-life.

*Jackson.* Our Jackson, Alabama mill has historically produced UFS and has the capability to produce both commodity and specialty papers on its No. 1 and No. 3 machines.

Since October 2020, the mill has also produced containerboard.

See "Packaging — Facilities — Jackson" for further information.

Major Raw Materials Used

As part of our renewable virgin fiber sourcing efforts, we participate in the Sustainable Forestry Initiative® (SFI), the Programme for the Endorsement of Forest Certification (PEFC), as well as the Forest Stewardship Council® (FSC®), and we are certified under their sourcing and chain of custody standards.

Sales, Marketing, and Distribution

Customers

Competition

These duties remain in effect after sunset review of duty orders by the U.S. International Trade Commission in January 2022.

Human Capital

PCA has experienced some labor shortage issues due to labor market conditions in general which has been exacerbated by the pandemic, particularly the recent spread of the Omicron variant.

We believe it is essential to hire and promote diverse candidates and employees in order to bring the best ideas to serve our customers.

We have established a Diversity, Equity, and Inclusion Council consisting of leaders throughout our organization to hone our strategy and to create a roadmap for inclusive leadership.

In 2021, we began to publicly disclose in our annual responsibility report our employee demographics in the form of our annual EEO-1 report.

Our responsibility report is available on our website and is not intended to be incorporated by reference herein.

To promote strong and increasing engagement of all PCA employees, we regularly conduct employee engagement surveys and are next scheduled to do so in 2022.

We have generally experienced a high survey response rate, assuring us that the survey results strongly represent the feelings and opinions of our employees.

Our most recent 2018 employee engagement index trended upward and remained notably above the Global Manufacturing Benchmark index.

In their survey responses, our employees reaffirmed our strong safety culture and also overwhelmingly agreed that they enjoy the work they do and that it gives them a sense of personal accomplishment.

Our next survey will include diversity, equity and inclusion topics.

Darla J.

Olivier, 52, Senior Vice President – Tax, ESG and Government Affairs \- Ms. Olivier has led our tax department since 1994 and served as Vice President—Tax from October 2010 to January 2022.

In January 2022, she was promoted to Senior Vice President—Tax, ESG and Government Affairs, and leads our sustainability reporting and government affairs functions.

Before joining PCA, Ms. Olivier worked for Coopers & Lybrand LLP, Alberto-Culver Company and SPX Corporation.

| --- | --- |

We operate six containerboard mills, two uncoated freesheet (UFS) paper mills, and 90 corrugated products manufacturing plants.

During the fourth quarter of 2020, due to an increase in demand for our corrugated products and as part of our assessment of a potential conversion to produce containerboard, we began producing high-performance, virgin kraft linerboard on the No. 3 machine at our Jackson, Alabama mill on a trial basis.

During the second quarter of 2018, we discontinued the production of paper grades at the Wallula, Washington mill and converted the No. 3 machine to production of virgin kraft linerboard.

Before May 2018, operating results for the Wallula mill were included in the Paper segment.

After May 2018, operating results for the Wallula mill are primarily included in the Packaging segment.

| | | | 2018 | | | | 953 | | | | 1,020 | | | | 1,087 | | | | 1,021 | | | | 4,081 | |

| | | | 2018 | | | | 14.4 | | | | 15.1 | | | | 14.8 | | | | 14.6 | | | | 58.9 | |

| | | | 2018 | | | | 279 | | | | 252 | | | | 239 | | | | 247 | | | | 1,017 | |

Packaging Products

Counce.

DeRidder.

Valdosta.

Tomahawk.

Filer City.

Wallula.

Fiber supply.

Chemical supply.

Paper

Total annual UFS capacity is 964,000 tons.

Jackson.

International Falls.

Our International Falls, Minnesota mill produces both commodity and specialty papers on two paper machines.

Our Jackson mill purchases recycled fiber to produce our line of recycled office papers.

Energy supply.

customers.

These duties remain in effect and are subject to review in 2021.

Human Capital

As PCA’s operations continued to operate as “essential businesses,” we adopted measures to protect the health and safety of our employees, including social distancing practices, health screening procedures, enhanced sanitation procedures and enhanced absence pay policies.

These practices will continue into 2021 as the effects of the pandemic continue.

These principles are designed to develop and promote strong and increasing engagement of all PCA employees.

Mr. Mundy previously served as PCA’s Senior Vice President and Chief Financial Officer from 2015 to 2019.

He previously served as Vice President and Chief Information Officer from 2000 to 2019.

D.

Thomas W.H. Walton, 61, Senior Vice President - Sales and Marketing, Corrugated Products - Mr. Walton has served as Senior Vice President - Sales and Marketing, Corrugated Products since October 2009.

Prior to this, he served as a Vice President and Area General Manager within the Corrugated Products Group since 1998.

Mr. Walton joined the company in 1981 and has also held positions in production, sales, and general management.

Management's Discussion and Analysis of Financial Condition and Results of Operations”) or in our other filings with the

The future effect of the COVID-19 pandemic on our operations is uncertain.

On March 11, 2020, the World Health Organization declared the COVID-19 outbreak a pandemic.

Information concerning legal proceedings can be found in Note [removed: 20,] [added: 21,] Commitments, Guarantees, Indemnifications, and Legal Proceedings, of the Notes to Consolidated Financial Statements in “Part II, Item 8.

| --- | --- |

[removed: UNITED STATES][added: UNITED STATES]

[removed: SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

[removed: Form 10-K][added: Form 10-K]

| [removed: ☒] [added: ☒] | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the fiscal year [removed: ended December] [added: ended December] 31, [removed: 2020][added: 2021]

| [removed: ☐] [added: ☐] | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM [removed: TO] [added: TO] |

[removed: Commission] [added: Commission] file [removed: number 1-15399][added: number 1-15399]

[removed: ][added: ]

[removed: (Exact] [added: (Exact] Name of Registrant as Specified in its [removed: Charter)][added: Charter)]

| [removed: Delaware] [added: Delaware] | | [removed: 36-4277050] [added: 36-4277050] |

| [removed: (State] [added: (State] or Other Jurisdiction of Incorporation or [removed: Organization)] [added: Organization)] | | [removed: (I.R.S.] [added: (I.R.S.] Employer Identification [removed: No.)] [added: No.)] |

| [removed: 1] [added: 1] North Field [removed: Court, Lake Forest, Illinois] [added: Court, Lake Forest, Illinois] | | [removed: 60045] [added: 60045] |

| [removed: (Address] [added: (Address] of Principal Executive [removed: Offices)] [added: Offices)] | | [removed: (Zip Code)] [added: (Zip Code)] |

[removed: Registrant's] [added: Registrant's] telephone number, including area code: [removed: (847) 482-3000][added: (847) 482-3000]

[removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:][added: Act:]

At June 30, [removed: 2020,] [added: 2021,] the last day of the Registrant's most recently completed second fiscal quarter, the aggregate market value of Registrant's common equity held by non-affiliates was approximately [removed: $9,321,915,008] [added: $12,670,117,556] based upon the closing sale price as reported on the New York Stock Exchange.

On February [removed: 19, 2021,] [added: 18, 2022,] there were [removed: 94,828,214] [added: 93,533,810] shares of Common Stock outstanding.

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

Specified portions of the Proxy Statement for the Registrant's [removed: 2021] [added: 2022] Annual Meeting of Stockholders are incorporated by reference to the extent indicated in Part III of this Form 10-K.

| | [removed: [PART I](#PART_I)] [added: [PART I](#part_i)] | |

| Item 1. | [removed: [Business](#ITEM_1_BUSINESS)] [added: [Business](#item_1_business)] | [removed: 2] [added: 3] |

| | [removed: [Packaging](#PACKAGING)] [added: [Packaging](#packaging)] | [removed: 3] [added: 4] |

| | [removed: [Paper](#PAPER)] [added: [Paper](#paper)] | [removed: 6] [added: 7] |

| | [Corporate and [removed: Other](#CORPORATE_OR)] [added: Other](#corporate_or)] | [removed: 7] [added: 8] |

| | [Human [removed: Capital](#Human_Capital)] [added: Capital](#human_capital)] | [removed: 7] [added: 8] |

| | [Regulatory and Environmental [removed: Matters](#EM)] [added: Matters](#em)] | [removed: 8] [added: 9] |

| | [Executive Officers of the [removed: Registrant](#EXECUTIVE_FICERS__REGISTRANT)] [added: Registrant](#executive_ficers__registrant)] | [removed: 8] [added: 9] |

| Item 1A. | [Risk [removed: Factors](#Item_1A_RISK_FACTORS)] [added: Factors](#item_1a_risk_factors)] | [removed: 9] [added: 11] |

| Item 1B. | [Unresolved Staff [removed: Comments](#Item_1B_UNRESOLVED_STAFF_COMMENTS)] [added: Comments](#item_1b_unresolved_staff_comments)] | [removed: 14] [added: 16] |

| Item 2. | [removed: [Properties](#Item_2_PROPERTIES)] [added: [Properties](#item_2_properties)] | [removed: 14] [added: 16] |

| Item 3. | [Legal [removed: Proceedings](#Item_3_LEGAL_PROCEEDINGS)] [added: Proceedings](#item_3_legal_proceedings)] | [removed: 15] [added: 16] |

| Item 4. | [Mine Safety [removed: Disclosure](#Item_4_MINE_SAFETY_DISCLOSURE)] [added: Disclosure](#item_4_mine_safety_disclosure)] | [removed: 15] [added: 16] |

| | [removed: [PART II](#PART_II)] [added: [PART II](#part_ii)] | |

| Item 5. | [Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity [removed: Securities](#Item_5_MARKET_FOR_REGISTRANTS_COMMON)] [added: Securities](#item_5_market_for_registrants_common)] | [removed: 16] [added: 17] |

| | [Off-Balance Sheet [removed: Arrangements](#Off_Balance_Sheet_Arrangements)] [added: Arrangements](#off_balance_sheet_arrangements)] | [removed: 27] [added: 26] |

| | [Inflation and Other General Cost [removed: Increases](#INFLATION_OR_GENERAL_COST_INCREASES)] [added: Increases](#inflation_or_general_cost_increases)] | [removed: 27] [added: 26] |

| | [Regulatory and Environmental [removed: Matters](#EM1)] [added: Matters](#em1)] | [removed: 28] [added: 27] |

| | [Critical Accounting Policies and [removed: Estimates](#CRITICAL_ACCOUNTING_POLICIES_ESTIMATES)] [added: Estimates](#critical_accounting_policies_estimates)] | [removed: 29] [added: 28] |

| | [New and Recently Adopted Accounting [removed: Standards](#NEW_RECENTLY_ADOPTED_ACCOUNTING_STARDS)] [added: Standards](#new_recently_adopted_accounting_stards)] | [removed: 32] [added: 31] |

| | |

| | |

| | | | | | | |

| Item 9C. | [Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](#item_9c_foreign_jurisdictions) | 77 |

| | | |

| | | |

| | | |

| --- | --- |

We currently own buildings and land for [removed: six containerboard mills and two paper] [added: our eight] mills.

Additionally, we have 90 corrugated manufacturing operations, of which the buildings and land for [removed: 52] [added: 53] are owned, including [removed: 44] [added: 45] combining operations, or corrugated plants, one corrugated sheet-only manufacturer, and seven sheet plants.

We lease the buildings for 14 corrugated plants and [removed: 24] [added: 23] sheet plants.

| --- | --- |

We lease the cutting rights to approximately 71,000 acres of timberland located near our Valdosta mill (64,000 acres) and our Counce mill (7,000 acres).

On average, these cutting rights agreements have terms with approximately 17 years remaining.

PART II

| --- | --- |

PART II

[removed: Market Information][added: Market Information]

[removed: Stockholders][added: Stockholders]

On February [removed: 19, 2021,] [added: 18, 2022,] there were [removed: 109] [added: 137] holders of record of our common stock.

[removed: Purchases] [added: Purchases] of Equity [removed: Securities][added: Securities]

[removed: Stock] [added: Stock] Repurchase [removed: Program][added: Program]

The Company did not repurchase any shares of its common stock [removed: under this authority] during the years ended December 31, [removed: 2020, 2019,] [added: 2020] and [removed: 2018.][added: 2019.]

Total shares withheld in [removed: 2018] [added: 2021] were [removed: 69,255 for $7.9] [added: 95,437 to cover $12.9] million in employee tax liabilities.

The following table presents information related to our repurchases of common stock made under repurchase plans authorized by PCA's Board of Directors, and shares withheld to cover taxes on vesting of equity awards, during the three months ended December 31, [removed: 2020:][added: 2021:]

| [removed: Issuer] [added: Issuer] Purchases of Equity [removed: Securities] [added: Securities] | | | | | | | | | | | | | | | | | |

| [removed: Period] [added: Period] | | [removed: Total] [added: Total] Number of Shares [removed: Purchased (a)] [added: Purchased] | | | | | [removed: Average] [added: Average] Price Paid Per Share [added: (b)] | | | | [removed: Total] [added: Total] Number of Shares Purchased as Part of Publicly Announced Plans or [removed: Programs] [added: Programs] | | | | [removed: Approximate] [added: Approximate] Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in [removed: millions)] [added: millions)] | | |

| October 1-31, [removed: 2020] [added: 2021] | | | [removed: 40] [added: —] | | | | $ | [removed: 118.70] [added: —] | | | | — | | | $ | 193.0 | |

[removed: | (a) | 40] [added: 7,471] shares were withheld from employees to cover income and payroll taxes on equity awards that vested during the period. [removed: |]

The graph below compares PCA’s cumulative 5-year total shareholder return on common stock with the cumulative total returns of the S&P 500 index; the S&P Midcap 400 index; and a customized peer group of [removed: three] [added: two] companies that includes: International Paper [removed: Company, WestRock Company,] and [removed: Domtar Corporation.][added: WestRock Company.]

The graph tracks the performance of a $100 investment (including the reinvestment of all dividends) in our common stock, in each index, and in each peer group's common stock from December 31, [removed: 2015] [added: 2016] through December 31, [removed: 2020.][added: 2021.]

[removed: ][added: ]

| | | [removed: Cumulative] [added: Cumulative] Total [removed: Return] [added: Return] | | | | | | | | | | | | | | | | | | | | | | |

| | | [removed: December 31,] [added: December 31,] | | | | | | | | | | | | | | | | | | | | | | |

| | | [removed: 2015] [added: 2016] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2018] [added: 2019] | | | | [removed: 2019] [added: 2020] | | | | [removed: 2020] [added: 2021] | | |

On January 26, 2022, PCA announced that its Board of Directors authorized the repurchase of $1 billion of the Company's outstanding common stock from time to time in open market or privately negotiated transactions in accordance with applicable securities laws.

During the fourth quarter of 2021, we paid $193.0 million to repurchase 1.4 million shares of common stock, which was the entire remaining amount of repurchase authority we had under previously announced share repurchase programs.

All shares repurchased have been retired.

| | | | | | | | | | | | | | | | | | |

| November 1-30, 2021 | | | 1,209,317 | | (a) | | | 133.91 | | | | 1,206,612 | | | | 31.4 | |

| December 1-31, 2021 | | | 240,765 | | (a) | | | 133.17 | | | | 235,999 | | | | — | |

| Total | | | 1,450,082 | | | | $ | 133.78 | | | | 1,442,611 | | | $ | — | |

(a)

(b)

Excludes commissions.

Domtar Corporation, which was included in the peer group in prior years, is no longer actively traded due to a recent acquisition.

As a result, Domtar Corporation was subsequently removed from the peer group for the 2021 analysis.

| | | | | | | | | | | | | | | | | | | | | | | | | |

| Packaging Corporation of America | | $ | 100.00 | | | $ | 145.49 | | | $ | 103.50 | | | $ | 143.19 | | | $ | 182.23 | | | $ | 185.17 | |

| S&P 500 | | | 100.00 | | | | 121.83 | | | | 116.49 | | | | 153.17 | | | | 181.35 | | | | 233.41 | |

| S&P Midcap 400 | | | 100.00 | | | | 116.24 | | | | 103.36 | | | | 130.44 | | | | 148.26 | | | | 184.96 | |

| Peer Group | | | 100.00 | | | | 118.91 | | | | 80.79 | | | | 96.62 | | | | 106.57 | | | | 110.53 | |

| --- | --- |

On February 25, 2016, PCA announced that its Board of Directors authorized the repurchase of $200.0 million of the Company's outstanding common stock.

As of December 31, 2020, we are authorized to repurchase $193.0 million of the Company’s common stock.

| November 1-30, 2020 | | | — | | | | | — | | | | — | | | | 193.0 | |

| December 1-31, 2020 | | | — | | | | | — | | | | — | | | | 193.0 | |

| Total | | | 40 | | | | $ | 118.70 | | | | — | | | $ | 193.0 | |

| Packaging Corporation of America | | $ | 100.00 | | | $ | 139.09 | | | $ | 202.37 | | | $ | 143.96 | | | $ | 199.16 | | | $ | 253.47 | |

| S&P 500 | | | 100.00 | | | | 111.96 | | | | 136.40 | | | | 130.42 | | | | 171.49 | | | | 203.04 | |

| S&P Midcap 400 | | | 100.00 | | | | 120.74 | | | | 140.35 | | | | 124.80 | | | | 157.49 | | | | 179.00 | |

| Peer Group | | | 100.00 | | | | 136.61 | | | | 163.30 | | | | 111.72 | | | | 132.91 | | | | 144.12 | |

| --- | --- |

The following table sets forth selected historical financial data of PCA (dollars and shares in millions, except per share data).

The information contained in the table should be read in conjunction with the disclosures in “Part II, Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Part II, Item 8.

Financial Statements and Supplementary Data” of this Form 10-K.

| | | Year Ended December 31, | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | 2020 | | | | 2019 | | | | 2018 | | | | 2017 | | | | 2016 | | |

| Statement of Income Data (a): | | | | | | | | | | | | | | | | | | | | |

| Net sales | | $ | 6,658.2 | | | $ | 6,964.3 | | | $ | 7,014.6 | | | $ | 6,444.9 | | | $ | 5,779.0 | |

| Net income | | | 461.0 | | | | 696.4 | | | | 738.0 | | | | 668.6 | | | | 449.6 | |

| Net income per common share: | | | | | | | | | | | | | | | | | | | | |

| — basic | | | 4.86 | | | | 7.36 | | | | 7.82 | | | | 7.09 | | | | 4.76 | |

| — diluted | | | 4.84 | | | | 7.34 | | | | 7.80 | | | | 7.07 | | | | 4.75 | |

| Weighted average common shares outstanding: | | | | | | | | | | | | | | | | | | | | |

| — basic | | | 94.1 | | | | 93.8 | | | | 93.7 | | | | 93.5 | | | | 93.5 | |

| — diluted | | | 94.4 | | | | 94.1 | | | | 93.9 | | | | 93.7 | | | | 93.7 | |

| Cash dividends declared per common share | | | 3.37 | | | | 3.16 | | | | 3.00 | | | | 2.52 | | | | 2.36 | |

| Balance Sheet Data (a): | | | | | | | | | | | | | | | | | | | | |

| Total assets | | $ | 7,433.2 | | | $ | 7,235.8 | | | $ | 6,569.7 | | | $ | 6,197.5 | | | $ | 5,777.0 | |

| Total long-term obligations (b) | | | 2,495.4 | | | | 2,494.3 | | | | 2,502.7 | | | | 2,650.7 | | | | 2,667.4 | |

| Stockholders' equity | | | 3,246.3 | | | | 3,071.0 | | | | 2,672.4 | | | | 2,182.6 | | | | 1,759.8 | |

| (a) | Effective January 1, 2019, the Company adopted ASU 2016-02 (Topic 842): *Leases*, which requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under the previous guidance. We elected to apply this guidance as of its effective date and did not restate comparative periods. See Note 2, Summary of Significant Accounting Policies, and Note 3, Leases, for more information. |

Effective January 1, 2016, the Company adopted Accounting Standards Update (ASU) 2015-03 (Topic 835): *Simplifying the Presentation of Debt Issuance Costs*.

We applied this guidance retrospectively, as required, and reclassified the debt issuance costs from “Other long-term assets” to “Long-term debt” on our Consolidated Balance Sheet to conform with current period presentation.

Total assets for all periods presented have been updated to reflect this adoption.

Net income and net income per common share are impacted by a lower U.S. corporate federal statutory income tax rate of 21% in 2020, 2019, and 2018 and 35% in all prior years presented in this table.

In addition, both 2018 and 2017 include a tax benefit of $2.0 million and $122.1 million, respectively, related to the enactment in December 2017 of the Tax Cuts and Jobs Act (H.R.1).

See Note 7, Income Taxes, for more information.

| (b) | Includes long-term debt and finance lease obligations. |

[removed: INDEX] [added: INDEX] TO FINANCIAL [removed: STATEMENTS][added: STATEMENTS]

| [removed: Packaging] [added: Packaging] Corporation of America Consolidated Financial [removed: Statements] [added: Statements] | |

| [Reports of Independent Registered Public Accounting [removed: Firm](#REPORT_INDEPENDENT_REGISTERED_PUBLIC_ACC)] [added: Firm (KPMG LLP, Chicago, IL, Auditor Firm ID: 185)](#report_independent_registered_public_acc)] | 36 |

| [Consolidated Statements of Income and Comprehensive Income for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018](#CONSOLIDATED_STATEMENTS_INCOME_COMPREHEN)] [added: 2019](#consolidated_statements_income_comprehen)] | [removed: 39] [added: 38] |

| [Consolidated Balance Sheets as of December 31, [removed: 2020] [added: 2021] and [removed: 2019](#CONSOLIDATED_BALANCE_SHEETS)] [added: 2020](#consolidated_balance_sheets)] | [removed: 40] [added: 39] |

| [Consolidated Statements of Cash Flows for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018](#CONSOLIDATED_STATEMENTS_CASH_FLOWS)] [added: 2019](#consolidated_statements_cash_flows)] | [removed: 41] [added: 40] |

| [Consolidated Statement of Changes in Stockholders' Equity for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018](#CONSOLIDATED_STATEMENTS_CHANGES_IN_STOCK)] [added: 2019](#consolidated_statements_changes_in_stock)] | [removed: 42] [added: 41] |

| [Notes to Consolidated Financial [removed: Statements](#NOTES_TO_CONSOLIDATED_FINANCIAL_STATEMEN)] [added: Statements](#notes_to_consolidated_financial_statemen)] | [removed: 43] [added: 42] |

[removed: REPORT] [added: REPORT] OF INDEPENDENT [removed: REGISTERED] [added: REGISTERED] PUBLIC ACCOUNTING [removed: FIRM][added: FIRM]

[removed: Opinions] [added: *Opinions] on the Consolidated Financial Statements and Internal Control Over Financial [removed: Reporting][added: Reporting*]

We have audited the accompanying consolidated balance sheets of Packaging Corporation of America and subsidiaries (the Company) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of income and comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2020,] [added: 2021,] and the related notes (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control – Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2020,] [added: 2021,] in conformity with U.S. generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020] [added: 2021] based on criteria established in [removed: Internal] [added: *Internal] Control – Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission.

[removed: Basis] [added: *Basis] for [removed: Opinions][added: Opinions*]

[removed: Definition] [added: *Definition] and Limitations of Internal Control Over Financial [removed: Reporting][added: Reporting*]

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally [added: accepted accounting principles.]

[removed: Critical] [added: *Critical] Audit [removed: Matters][added: Matter*]

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the consolidated financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that: (1) [removed: relate] [added: relates] to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of [removed: the] [added: a] critical audit [removed: matters] [added: matter] does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the accounts or disclosures to which [removed: they relate.][added: it relates.]

As discussed in Note [removed: 12] [added: 13] to the consolidated financial statements, the Company’s estimated pension benefit obligation totaled [removed: $1,566] [added: $1,504] million as of December 31, [removed: 2020.][added: 2021.]

[removed: -] changes in the discount rate from the prior year against changes in published indices;

[removed: -] the pattern of cash flows, including consideration of the plan type and plan provisions; and

[removed: -] the selected yield curve and its consistency with the prior year and spot rates.

[removed: Goodwill impairment assessment][added: Goodwill Impairment]

[removed: Packaging] [added: Packaging] Corporation of [removed: America][added: America]

[removed: Consolidated] [added: Consolidated] Statements of [removed: Income] [added: Income] and Comprehensive [removed: Income][added: Income]

| | | [removed: Year] [added: Year] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | |

| | | [removed: 2020] [added: 2021] | | | | [removed: 2019] [added: 2020] | | | | [removed: 2018] [added: 2019] | | |

| [removed: Statements] [added: Statements] of [removed: Income] [added: Income] | | | | | | | | | | | | |

| Net sales | | $ | [removed: 6,658.2] [added: 7,730.3] | | | $ | [removed: 6,964.3] [added: 6,658.2] | | | $ | [removed: 7,014.6] [added: 6,964.3] | |

| Cost of sales | | | [removed: (5,288.8] [added: (5,857.3] | ) | | | [removed: (5,320.3] [added: (5,288.8] | ) | | | [removed: (5,369.3] [added: (5,320.3] | ) |

| Gross profit | | | [removed: 1,369.4] [added: 1,873.0] | | | | [removed: 1,644.0] [added: 1,369.4] | | | | [removed: 1,645.3] [added: 1,644.0] | |

| Selling and administrative expenses | | | [removed: (539.6] [added: (576.8] | ) | | | [removed: (557.6] [added: (539.6] | ) | | | [removed: (536.4] [added: (557.6] | ) |

| Goodwill impairment | | | [removed: (55.2] [added: —] | [removed: )] | | | [removed: —] [added: (55.2] | [added: )] | | | — | |

| Other expense, net | | | [removed: (50.7] [added: (54.8] | ) | | | [removed: (32.7] [added: (50.7] | ) | | | [removed: (41.2] [added: (32.7] | ) |

| Income from operations | | | [removed: 723.9] [added: 1,241.4] | | | | [removed: 1,053.7] [added: 723.9] | | | | [removed: 1,067.7] [added: 1,053.7] | |

| Non-operating pension income (expense) | | | [removed: 2.3] [added: 19.7] | | | | [removed: (7.9] [added: 2.3] | [removed: )] | | | [removed: (2.1] [added: (7.9] | ) |

| Interest expense, net | | | [removed: (93.5] [added: (152.4] | ) | | | [removed: (128.8] [added: (93.5] | ) | | | [removed: (95.1] [added: (128.8] | ) |

| Income before taxes | | | [removed: 632.7] [added: 1,108.7] | | | | [removed: 917.0] [added: 632.7] | | | | [removed: 970.5] [added: 917.0] | |

The Company acquired Advance Packaging Corporation during 2021, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021, Advance Packaging Corporation’s internal control over financial reporting associated with approximately 3% of the Company’s consolidated total assets and less than 1% of consolidated net sales included in the consolidated financial statements of the Company as of and for the year ended December 31, 2021.

Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Advance Packaging Corporation.

| | |

| | |

| | February 24, 2022 |

| | | | | | | | | | | | | |

| Net income | | $ | 841.1 | | | $ | 461.0 | | | $ | 696.4 | |

Packaging Corporation of America

| Finance lease obligations | | | 12.7 | | | | 14.4 | |

Packaging Corporation of America

| | | | | | | | | | | | | |

| Net income | | $ | 841.1 | | | $ | 461.0 | | | $ | 696.4 | |

| Acquisition of business, net of cash acquired | | | (194.9 | ) | | | — | | | | — | |

| Repurchases of common stock | | | (193.0 | ) | | | — | | | | — | |

Packaging Corporation of America

| | | | | | | | | | | | | | | | | | | | | | | | | | |

| Common stock repurchases and retirements | | | (1,443 | ) | | | — | | | | (11.5 | ) | | | (181.5 | ) | | | — | | | | | (193.0 | ) |

| Other | | | — | | | | — | | | | 1.0 | | | | (1.0 | ) | | | — | | | | | — | |

| Comprehensive income | | | — | | | | — | | | | — | | | | 841.1 | | | | 69.3 | | | | | 910.4 | |

| Balance at December 31, 2021 | | | 93,539 | | | $ | 0.9 | | | $ | 579.4 | | | $ | 3,102.1 | | | $ | (75.2 | ) | | | $ | 3,607.2 | |

1.

Our Jackson, Alabama mill had historically operated as a UFS mill, with its results of operations reported in our Paper segment.

During the fourth quarter of 2020, in order to meet strong packaging demand and maintain appropriate inventory levels, we temporarily began producing linerboard on the No. 3 machine at our Jackson, Alabama mill.

In the first quarter of 2021, we announced the discontinuation of production of uncoated freesheet paper grades on the machine and the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.

2.

The Company has entered into a number of customer-based supply chain financing programs to accelerate the receipt of payments for outstanding accounts receivable from certain customers.

Receivables transferred under these programs meet the requirements to be accounted for as sales in accordance with guidance under Financial Accounting Standards Board (“FASB”) ASC 860, *Transfers and Servicing.* The receivables are sold without recourse and are reflected as a reduction of accounts receivable on the Consolidated Balance Sheets at the time of sale.

The corresponding proceeds are reflected in cash flows from operating activities within the Consolidated Statements of Cash Flows.

Receivables involved with these programs constituted less than 5% of our 2021 net sales.

| | | | | | | | | |

| | | 2021 | | | | 2020 | | |

| | | | | | | | | |

| | | 2021 | | | | 2020 | | |

| | | |

The incremental depreciation expense for 2021 related to Jackson mill conversion-related activities and closures of corrugated products facilities.

The Company did not adopt any new accounting standards during 2021.

In October 2021, the FASB issued ASU 2021-08, *Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers*.

ASU 2021-08 requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, *Revenue from Contracts with Customers*.

Under current business combination guidance in ASC 805, *Business Combinations*, such assets and liabilities are recognized by the acquirer at fair value on the acquisition date, whereas the new guidance requires the acquirer to recognize such assets and liabilities as if it had originated the contracts.

The ASU is effective for annual periods beginning after December 15, 2022, and interim periods within those annual periods, with early adoption permitted.

| --- | --- |

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Update 2016-02, *Leases (Topic 842)*, and its subsequent amendments.

accepted accounting principles.

As discussed in Note 8 to the consolidated financial statements, the Company’s consolidated goodwill balance was $863.5 million as of December 31, 2020, which related to the Packaging reporting unit.

Goodwill is tested for impairment annually in the fourth quarter of each fiscal year, or more frequently when events or changes in circumstances indicate that the carrying value of a reporting unit may exceed its fair value.

During the second quarter of the year-ended December 31, 2020, the Company identified a triggering event and recorded a goodwill impairment loss of $55.2 million related to its Paper reporting unit.

To estimate the fair value of the Paper reporting unit, the

Company utilized a combination of the income approach and a market approach that used observable comparable company information.

We identified the evaluation of goodwill for impairment for the Paper reporting unit as a critical audit matter.

Especially subjective and challenging auditor judgment was required to evaluate the Company’s estimated future cash flows, specifically the selection of forecasted revenue growth rates, gross profit margins, operating margins, and the discount rate used in the income approach.

Additionally, the audit effort associated with the evaluation of goodwill for impairment for the Paper reporting unit required the use of professionals with specialized skills and knowledge.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s goodwill impairment evaluation, including controls over the selection of forecasted revenue growth rates, gross profit margins, operating margins, and the discount rate used in the estimate of the fair value of the Paper reporting unit.

We evaluated the reasonableness of management’s forecasted revenue growth rates, gross profit margins, and operating margins by comparing the forecasts to historical revenue growth rates, gross profit margins, and operating margins, and considering industry conditions and growth plans.

We performed sensitivity analyses to assess the impact of reasonably possible changes to the forecasted revenue growth rates, gross profit margins, operating margins, and the discount rate assumptions on the reporting unit fair value.

In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in:

| | • | evaluating the Company’s discount rate by comparing the Company’s discount rate inputs to publicly available data for comparable entities and assessing the results; and |

| --- | --- | --- |

| | • | testing the estimate of fair value for the Paper reporting unit using the Company’s estimated future cash flows and discount rate and comparing the result to the Company’s fair value estimate. |

| | February 24, 2021 |

| Net loss on impairment of assets | | | — | | | | — | | | | 3.1 | |

| Acquisitions of businesses, net of cash acquired | | | — | | | | — | | | | (56.3 | ) |

| Balance at January 1, 2018 | | | 94,350 | | | $ | 0.9 | | | $ | 471.2 | | | $ | 1,867.4 | | | $ | (156.9 | ) | | | $ | 2,182.6 | |

| Adoption of ASC 606 | | | — | | | | — | | | | — | | | | 1.6 | | | | — | | | | | 1.6 | |

| Other | | | — | | | | — | | | | 0.3 | | | | 0.2 | | | | — | | | | | 0.5 | |

| Comprehensive income | | | — | | | | — | | | | — | | | | 738.0 | | | | 18.1 | | | | | 756.1 | |

During the fourth quarter of 2020, due to an increase in demand for our corrugated products and as part of our assessment of a potential conversion to produce containerboard, we began producing high-performance, virgin kraft linerboard on the No. 3 machine at our Jackson, Alabama mill on a trial basis.

Before May 2018, operating results for the Wallula mill were included in the Paper segment.

After May 2018, operating results for the Wallula mill are primarily included in the Packaging segment.

We recorded no other-than-temporary impairment charges on our AFS securities for the year ended December 31, 2019 under prior year guidance ASU 2016-01, *Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities*.

As of December 31, 2020, we do not expect the effect of the COVID-19 pandemic to have a material impact on our ability to collect on our outstanding trade accounts receivable.

If an evaluation is required, the estimated

incurred.

These costs were immaterial as of December 31, 2019.

Effective January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, *Financial Instruments – Credit Losses* (Topic 326)*: Measurement of Credit Losses on Financial Instruments.* ASU 2016-13 introduces the Current Expected Credit Losses (“CECL”) framework for evaluating credit losses on financial instruments measured at amortized cost.

ASU 2016-13 was applied using the modified retrospective method, and as a result, amounts recorded prior to January 1, 2020 have not been retrospectively restated.

This new framework requires entities to incorporate forward-looking information into their estimate of current expected credit loss as of each reporting date.

Although available-for-sale (“AFS”) debt securities are not within the scope of the new CECL framework, the ASU includes an amended impairment model for evaluating losses related to AFS debt securities.

The guidance in this update also includes enhanced requirements for disclosures related to credit loss estimates.

| --- | --- |

[removed: Controls] [added: Controls] and [removed: Procedures][added: Procedures]

Prior to filing this report, PCA completed an evaluation under the supervision and with the participation of PCA’s management, including PCA’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of PCA’s disclosure controls and procedures as of December 31, [removed: 2020.][added: 2021.]

Based on this evaluation, PCA’s Chief Executive Officer and Chief Financial Officer concluded that PCA’s disclosure controls and procedures were effective at the reasonable assurance level as of December 31, [removed: 2020.][added: 2021.]

[removed: During] [added: Except as may relate to] the [removed: quarter ended December 31, 2020,] [added: Advance Packaging acquisition,] there were no [added: other] changes in [added: our] internal [removed: controls] [added: control] over financial reporting [added: (as defined in Rule 13a-15(f) under the Exchange Act)] that [added: occurred during the most recent fiscal quarter ended December 31, 2021 that] have materially affected, or are reasonably likely to materially affect, [removed: PCA’s] [added: our] internal control over financial reporting.

[removed: Management’s] [added: Management’s] Report on Internal Control Over Financial [removed: Reporting][added: Reporting]

PCA’s management, under the supervision of and with the participation of the Chief Executive Officer and Chief Financial Officer, assessed the Company’s internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on this assessment, [added: and excluding the operations acquired from Advance Packaging,] PCA’s management concluded that its internal control over financial reporting was effective as of December 31, [removed: 2020,] [added: 2021,] based on the specified criteria.

Changes in Internal Control over Financial Reporting

On December 10, 2021, PCA acquired Advance Packaging Corporation ("Advance Packaging").

We are currently in the process of evaluating and integrating Advance Packaging's controls over financial reporting which may result in changes or additions to PCA's internal control over financial reporting.

Under guidelines established by the SEC, companies are permitted to exclude acquisitions from their assessment of internal control over financial reporting during the first year of an acquisition while integrating the acquired company.

We excluded Advance Packaging from the assessment of internal control over financial reporting at December 31, 2021.

As of and for the year ended December 31, 2021, Advance Packaging accounted for approximately 3% of the Company's consolidated total assets and less than 1% of consolidated net sales.

| --- | --- |

| --- | --- |

PART III

Not applicable.

PART III

The following information required by this Item 10 will be included in PCA’s Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and is incorporated by reference herein:

[removed: | | • |] Information regarding PCA’s directors included under the caption “Election of Directors” [removed: |]

[removed: | | • |] Information regarding PCA’s Audit Committee and financial experts included under the caption “Election of Directors - Audit Committee” [removed: |]

[removed: | | • |] Information regarding PCA’s codes of ethics included under the caption “Election of Directors - Code of Ethics” [removed: |]

[removed: | | • |] Information regarding PCA’s stockholder nominating procedures included under the captions “Election of Directors - Nominating and Governance Committee,” “Other Information - Recommendations for Board - Nominated Director Nominees,” and “Other Information - Procedures for Nominating Directors or Bringing Business Before the [removed: 2022] [added: 2023] Annual Meeting” [removed: |]

[removed: | | • |] Information regarding compliance with Section 16(a) of the Securities Exchange Act of 1934 included under the caption “Delinquent Section 16(a) Reports” [removed: |]

| --- | --- |

| --- | --- | --- |

| --- | --- |

[removed: Authorization] [added: *Authorization] of Securities under Equity Compensation Plans [removed: —] [added: —*] Securities authorized for issuance under our equity compensation plans at December 31, [removed: 2020] [added: 2021] are as follows:

| | | [removed: Column] [added: Column] | | | | | | | | | | |

| [removed: Plan Category] [added: Plan Category] | | [removed: Number] [added: Number] of Securities to Be Issued [removed: Upon Exercise] [added: Upon Exercise] of Outstanding Options, Warrants, and Rights [removed: (a)] [added: (a)] | | | | [removed: Weighted] [added: Weighted] Average Exercise Price of Outstanding Options, Warrants, and [removed: Rights] [added: Rights] | | | | [removed: Number] [added: Number] of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column [removed: A)] [added: A)] | | |

| Equity compensation plans approved by securityholders | | | — | | | $ | — | | | | [removed: 1,498,417] [added: 1,317,879] | |

[removed: | (a) | Assumes that outstanding performance units pay out at the target level.] Does not include [removed: 1,026,519] [added: 1,009,540] shares of unvested restricted stock and performance units granted pursuant to our Amended and Restated 1999 Long-Term Equity Incentive Plan. [removed: |]

| | | | | | | | | | | | | |

| | | A | | | | B | | | | C | | |

| Total | | | — | | | $ | — | | | | 1,317,879 | |

(a)

Assumes that outstanding performance units pay out at the target level.

| --- | --- |

| | | A | | | | B | | | | C | | |

| Total | | | — | | | $ | — | | | | 1,498,417 | |

| --- | --- |

PART IV

| --- | --- |

PART IV

[removed: | | (a) |] The following documents are filed as a part of this report: [removed: |]

[removed: | | (1) |] The financial statements listed in the “Index to Financial Statements.” [removed: |]

[removed: | | (2) |] Financial Statement Schedule. [removed: |]

[removed: | | (3) |] Exhibits [removed: |]

| [removed: Exhibit Number] [added: Exhibit Number] | | [removed: Description] [added: Description] |

| 2.1 | | [Contribution Agreement, dated as of January 25, 1999, among Pactiv Corporation (formerly known as Tenneco Packaging Inc.) (“Pactiv”), PCA Holdings LLC (“PCA Holdings”) and Packaging Corporation of America (“PCA”). (Incorporated herein by reference to Exhibit 2.1 to PCA’s registration Statement on Form S-4, Registration No. [removed: 333-79511).](http://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] [added: 333-79511).](https://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] |

| 2.2 | | [Letter Agreement Amending the Contribution Agreement, dated as of April 12, 1999, among Pactiv, PCA Holdings and PCA. (Incorporated herein by reference to Exhibit 2.2 to PCA’s Registration Statement on Form S-4, Registration No. [removed: 333-79511).](http://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] [added: 333-79511).](https://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] |

| 2.3 | | [Agreement and Plan of Merger, dated September 16, 2013, between PCA, Bee Acquisition Corp. and Boise Inc. (Incorporated herein by reference to Exhibit 2.1 to PCA’s Current Report on Form 8-K filed September 17, 2013, File No. 1-15399). PCA will furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request; provided, however, that PCA may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so [removed: furnished.](http://www.sec.gov/Archives/edgar/data/75677/000119312513369362/d598791dex21.htm)] [added: furnished.](https://www.sec.gov/Archives/edgar/data/75677/000119312513369362/d598791dex21.htm)] |

| 3.1 | | [Restated Certificate of Incorporation of PCA. (Incorporated herein by reference to Exhibit 3.1 to PCA’s Registration Statement on Form S-4, Registration No. [removed: 333-79511).](http://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] [added: 333-79511).](https://www.sec.gov/Archives/edgar/data/75677/000104746999022512/0001047469-99-022512.txt)] |

| 3.2 | | [Certificate of Amendment to Restated Certificate of Incorporation of PCA. (Incorporated herein by reference to Exhibit 3.2 to PCA’s Registration Statement on Form S-4, Registration No. [removed: 333-109437.)](http://www.sec.gov/Archives/edgar/data/75677/000104746903032398/a2118661zex-3_2.htm)] [added: 333-109437.)](https://www.sec.gov/Archives/edgar/data/75677/000104746903032398/a2118661zex-3_2.htm)] |

| 3.3 | | [Amended and Restated By-laws of PCA. (Incorporated herein by reference to Exhibit 3.1 to PCA’s Current Report on Form 8-K filed December 13, 2020, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312520316937/d90011dex31.htm)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/75677/000119312520316937/d90011dex31.htm)] |

| 4.1 | | [Form of certificate representing shares of common stock. (Incorporated herein by reference to Exhibit 4.9 to PCA’s Registration Statement on Form S-1, Registration No. [removed: 333-86963.)](http://www.sec.gov/Archives/edgar/data/75677/000104746999039075/0001047469-99-039075.txt)] [added: 333-86963.)](https://www.sec.gov/Archives/edgar/data/75677/000104746999039075/0001047469-99-039075.txt)] |

| 4.2 | | [Indenture, dated as of July 21, 2003, between PCA and U.S. Bank National Association. (Incorporated herein by reference to Exhibit 4.2 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, 2003, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000104746903027375/a2115637zex-4_2.txt)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/75677/000104746903027375/a2115637zex-4_2.txt)] |

| 4.3 | | [First Supplemental Indenture, dated as of July 21, 2003, between PCA and U.S. Bank National Association. (Incorporated herein by reference to Exhibit 4.3 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, 2003, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000104746903027375/a2115637zex-4_3.txt)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/75677/000104746903027375/a2115637zex-4_3.txt)] |

| 4.4 | | [Officers’ Certificate, dated as of November 21, 2019, pursuant to Section 301 of the Indenture establishing 3.000% Senior Notes due 2029 and 4.050% Senior Notes due 2049. (Incorporated herein by reference to Exhibit 4.1 to PCA’s Current Report on Form 8-K filed November 21, 2019, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312519297139/d811970dex41.htm)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/75677/000119312519297139/d811970dex41.htm)] |

| 4.5 | | [3.000% Senior Notes due 2029. (Incorporated herein by reference to Exhibit 4.2 to PCA’s Current Report on Form 8-K filed November 21, 2019, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312519297139/d811970dex42.htm)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/75677/000119312519297139/d811970dex42.htm)] |

| 4.6 | | [4.050% Senior Notes due 2049. (Incorporated herein by reference to Exhibit 4.3 to PCA’s Current Report on Form 8-K filed November 21, 2019, File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312519297139/d811970dex43.htm)] [added: 1-15399.)](https://www.sec.gov/Archives/edgar/data/0000075677/000119312519297139/d811970dex43.htm)] |

| 4.7 | | [Officers’ Certificate, dated [removed: as of October 22, 2013,] [added: September 5, 2014,] pursuant to Section 301 of the Indenture establishing [removed: 4.500%] [added: 3.650%] Senior Notes due [removed: 2023.] [added: 2024.] (Incorporated herein by reference to Exhibit 4.1 to PCA’s Current Report on Form 8-K filed [removed: October 22, 2013,] [added: September 5, 2014,] File [removed: No 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312513406139/d615313dex41.htm)] [added: No. 1-15399).](https://www.sec.gov/Archives/edgar/data/75677/000119312514333019/d784171dex41.htm)] |

| 4.8 | | [removed: [4.500%] [added: [3.650%] Senior Notes due [removed: 2023.] [added: 2024] (Incorporated herein by reference to Exhibit 4.2 to PCA’s Current Report on Form 8-K filed [removed: October 22, 2013,] [added: September 5, 2014,] File [removed: No 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312513406139/d615313dex42.htm)] [added: No. 1-15399).](https://www.sec.gov/Archives/edgar/data/75677/000119312514333019/d784171dex42.htm)] |

| [removed: 4.9] [added: 4.11] | | [removed: [Officers’] [added: [Officer’s] Certificate, dated September [removed: 5, 2014,] [added: 21, 2021,] pursuant to Section 301 of the Indenture establishing [removed: 3.650%] [added: 3.050%] Senior Notes due [removed: 2024.] [added: 2051.] (Incorporated herein by reference to Exhibit 4.1 to PCA’s Current Report on Form 8-K filed September [removed: 5, 2014,] [added: 21, 2021,] File No. [removed: 1-15399).](http://www.sec.gov/Archives/edgar/data/75677/000119312514333019/d784171dex41.htm)] [added: 1-15399).](https://www.sec.gov/Archives/edgar/data/0000075677/000119312521277858/d225216dex41.htm)] |

| 4.10 | | [removed: [3.650%] [added: [3.400%] Senior Notes due [removed: 2024] [added: 2027] (Incorporated herein by reference to Exhibit [removed: 4.2] [added: 4.3] to PCA’s Current Report on Form 8-K filed [removed: September 5, 2014,] [added: December 13, 2017,] File No. [removed: 1-15399).](http://www.sec.gov/Archives/edgar/data/75677/000119312514333019/d784171dex42.htm)] [added: 1-15399).](https://www.sec.gov/Archives/edgar/data/75677/000119312517367914/d496380dex43.htm)] |

| [removed: 4.11] [added: 4.9] | | [Officer’s Certificate, dated December 13, 2017, pursuant to Section 301 of the Indenture establishing 2.450% Senior Notes due 2020 (redeemed and no longer outstanding) and 3.400% Senior Notes due 2027. (Incorporated herein by reference to Exhibit 4.1 to PCA’s Current Report on Form 8-K filed December 13, 2017, File No. [removed: 1-15399).](http://www.sec.gov/Archives/edgar/data/75677/000119312517367914/d496380dex41.htm)] [added: 1-15399).](https://www.sec.gov/Archives/edgar/data/75677/000119312517367914/d496380dex41.htm)] |

| 4.12 | | [removed: [3.400%] [added: [3.050%] Senior Notes due [removed: 2027] [added: 2051] (Incorporated herein by reference to Exhibit [removed: 4.3] [added: 4.2] to PCA’s Current Report on Form 8-K filed [removed: December 13, 2017,] [added: September 21, 2021,] File [removed: No. 1-15399).](http://www.sec.gov/Archives/edgar/data/75677/000119312517367914/d496380dex43.htm)] [added: No 1-15399.)](https://www.sec.gov/Archives/edgar/data/0000075677/000119312521277858/d225216dex42.htm)] |

| 4.13 | | [Description of Common Stock. (Incorporated herein by reference to Exhibit 4.13 to PCA's Annual Report on Form 10-K for the year ended December 31, 2019, File No. [removed: 1-15399).](http://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex413_182.htm)] [added: 1-15399).](https://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex413_182.htm)] |

| 10.1 | | [removed: [Amended and Restated Credit] [added: [Credit] Agreement, dated [removed: as] [added: June 8, 2021 between Packaging Corporation] of [removed: August 29, 2016, by and among PCA] [added: America] and the lenders and agents named therein. (Incorporated herein by reference to Exhibit 10.1 to PCA’s Current Report on Form 8-K filed [removed: September 1, 2016,] [added: June 11, 2021,] File No. [removed: 1-15399.)](http://www.sec.gov/Archives/edgar/data/75677/000119312516699119/d251743dex101.htm)] [added: 1-15399).](https://www.sec.gov/Archives/edgar/data/0000075677/000119312521188809/d32713dex101.htm)] |

| 10.2 | | [Packaging Corporation of America Thrift Plan for Hourly Employees and First Amendment of Packaging Corporation of America Thrift Plan for Hourly Employees, effective February 1, 2000. (Incorporated herein by reference to Exhibit 4.5 to PCA’s Registration Statement on Form S-8, Registration No. [removed: 333-33176.)](http://www.sec.gov/Archives/edgar/data/75677/000091205700013220/0000912057-00-013220.txt)] [added: 333-33176.)](https://www.sec.gov/Archives/edgar/data/75677/000091205700013220/0000912057-00-013220.txt)] |

| 10.3 | | [Packaging Corporation of America Retirement Savings Plan, effective February 1, 2000. (Incorporated herein by reference to Exhibit 4.6 to PCA’s Registration Statement on Form S-8, Registration No. [removed: 333-33176.)*](http://www.sec.gov/Archives/edgar/data/75677/000091205700013220/0000912057-00-013220.txt)] [added: 333-33176.)*](https://www.sec.gov/Archives/edgar/data/75677/000091205700013220/0000912057-00-013220.txt)] |

| 10.4 | | [Packaging Corporation of America Supplemental Executive Retirement Plan, as Amended and Restated Effective as of February 27, 2019. (Incorporated herein by reference to Exhibit 10.4 to PCA's Annual Report on Form 10-K for the year ended December 31, 2019, File No. [removed: 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex104_432.htm)] [added: 1-15399).*](https://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex104_432.htm)] |

| 10.5 | | [Packaging Corporation of America Deferred Compensation Plan, as Amended and Restated Effective as of February 27, 2019. (Incorporated herein by reference to Exhibit 10.5 to PCA's Annual Report on Form 10-K for the year ended December 31, 2019, File No. [removed: 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex105_433.htm)] [added: 1-15399).*](https://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex105_433.htm)] |

| 10.6 | | [Amended and Restated 1999 Long-Term Equity Incentive Plan, effective as of May 5, 2020, conformed to incorporate all amendments. (Incorporated herein by reference to Appendix A to PCA's Proxy Statement for the 2020 Annual Meeting of [removed: Stockholders)*](http://www.sec.gov/Archives/edgar/data/75677/000119312520080666/d861725ddef14a.htm#toc861725_13)] [added: Stockholders)*](https://www.sec.gov/Archives/edgar/data/0000075677/000119312520080666/d861725ddef14a.htm#toc861725_13)] |

| 10.7 | | [Amended and Restated Executive Incentive Compensation Plan, effective as of December 29, 2017. (Incorporated herein by reference to Exhibit 10.10 to PCA's Annual Report on Form 10-K for the year ended December 31, 2017, File No. [removed: 1-15399.)*](http://www.sec.gov/Archives/edgar/data/75677/000156459018003690/pkg-ex1010_155.htm)] [added: 1-15399.)*](https://www.sec.gov/Archives/edgar/data/75677/000156459018003690/pkg-ex1010_155.htm)] |

| [removed: 10.8] [added: 10.11] | | [Form of Restricted Stock Agreement for executive officer [removed: awards made in June 2017.] [added: awards.] (Incorporated by reference to Exhibit 10.1 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, [removed: 2017,] [added: 2018,] File No. [removed: 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459017015560/pkg-ex101_300.htm)] [added: 1-15399).*](https://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex101_55.htm)] |

| 10.9 | | [Form of [added: Return on Invested Capital] Performance Unit Agreement for executive officer [removed: awards made in June 2017.] [added: awards.] (Incorporated by reference to Exhibit 10.2 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, [removed: 2017,] [added: 2018,] File No. [removed: 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459017015560/pkg-ex102_301.htm)] [added: 1-15399).*](https://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex102_54.htm)] |

| 10.10 | | [removed: [Performance Based Equity Award Pool] [added: [Form of Total Shareholder Return Performance Unit Agreement] for [removed: Executive Officers relating to awards made in June 2017.] [added: executive officer awards.] (Incorporated by reference to Exhibit 10.3 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, [removed: 2017,] [added: 2018,] File No. [removed: 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459017015560/pkg-ex103_302.htm)] [added: 1-15399).*](https://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex103_53.htm)] |

| [removed: 10.11] [added: 10.8] | | [Trade Vendor Purchasing Agreement, dated December 6, 2019, between Boise White Paper, L.L.C. and Office Depot, Inc. (Incorporated by reference to Exhibit 10.11 to PCA's Annual Report on Form 10-K for the year ended December 31, 2019, File No. [removed: 1-15399)](http://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex1011_301.htm)] [added: 1-15399)](https://www.sec.gov/Archives/edgar/data/75677/000156459020006774/pkg-ex1011_301.htm)] |

| 21.1 | | [Subsidiaries of the [removed: Registrant.](https://www.sec.gov/Archives/edgar/data/75677/000156459021008051/pkg-ex211_8.htm)†] [added: Registrant.†](https://www.sec.gov/Archives/edgar/data/75677/000095017022001913/pkg-ex21_1.htm)] |

| 23.1 | | [Consent of KPMG [removed: LLP.](https://www.sec.gov/Archives/edgar/data/75677/000156459021008051/pkg-ex231_6.htm)†] [added: LLP.†](https://www.sec.gov/Archives/edgar/data/75677/000095017022001913/pkg-ex23_1.htm)] |

| 24.1 | | [Powers of [removed: Attorney.](https://www.sec.gov/Archives/edgar/data/75677/000156459021008051/pkg-ex241_10.htm)†] [added: Attorney.†](https://www.sec.gov/Archives/edgar/data/75677/000095017022001913/pkg-ex24_1.htm)] |

| 31.1 | | [Certification of Chief Executive Officer, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/75677/000156459021008051/pkg-ex311_13.htm)†] [added: 2002.†](https://www.sec.gov/Archives/edgar/data/75677/000095017022001913/pkg-ex31_1.htm)] |

| 31.2 | | [Certification of Chief Financial Officer, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/75677/000156459021008051/pkg-ex312_7.htm)†] [added: 2002.†](https://www.sec.gov/Archives/edgar/data/75677/000095017022001913/pkg-ex31_2.htm)] |

(a)

(1)

(2)

(3)

SIGNATURES

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| 10.12 | | [Form of Return on Invested Capital Performance Unit Agreement for executive officer awards made in and after June 2018. (Incorporated by reference to Exhibit 10.2 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, 2018, File No. 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex102_54.htm) |

| 10.13 | | [Form of Total Shareholder Return Performance Unit Agreement for executive officer awards made in and after June 2018. (Incorporated by reference to Exhibit 10.3 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, 2018, File No. 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex103_53.htm) |

| 10.14 | | [Form of Restricted Stock Agreement for executive officer awards made in and after June 2018. (Incorporated by reference to Exhibit 10.1 to PCA’s Quarterly Report on Form 10-Q for the period ended June 30, 2018, File No. 1-15399).*](http://www.sec.gov/Archives/edgar/data/75677/000156459018020254/pkg-ex101_55.htm) |

SIGNATURES