<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 F O R M 10 - K

             [X]ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended MAY 31, 1999


                                       OR

           [ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

      For the transition period from                  to

                        Commission file number 000-18815

                               OUTLOOK GROUP CORP.
             (Exact name of registrant as specified in its charter)

       WISCONSIN                                     39-1278569
       ---------                                     ----------
(State of incorporation)              (I.R.S. Employer Identification No.)

1180 AMERICAN DRIVE, NEENAH, WISCONSIN                      54956
(Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code:  (920) 722-2333

Securities registered pursuant to Section 12(b) of the Act:  NONE

Securities registered pursuant to Section 12(g) of the Act:  COMMON STOCK, $.01
PAR VALUE


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                           Yes       X                  No


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

As of August 27, 1999, 4,623,432 shares of Common Stock were outstanding, and
the aggregate market value of the Common Stock (based upon the $4.00 last sale
price on the NASDAQ Stock Market) held by non-affiliates (excludes a total of
1,267,615 shares reported as beneficially owned by directors, executive officers
and greater-than 10% shareholders -- does not constitute an admission as to
affiliate status) was approximately $13.4 million.

                       DOCUMENTS INCORPORATED BY REFERENCE

                              PART OF FORM 10-K INTO WHICH
            DOCUMENT                 PORTIONS OF DOCUMENTS ARE INCORPORATED
            --------                 --------------------------------------

     Proxy Statement for 1999 Annual                Part III
   Meeting of Shareholders



<PAGE>   2
                                                                               1


                                     PART I

ITEM 1.  BUSINESS.

GENERAL

         Outlook Group Corp. (the "Company") is a printing , packaging and
promotional direct mail company offering a variety of related services to
customers in markets including promotional contract packaging, collateral
information management and distribution, packaging materials, direct mail
components and services, and commercial printing. The Company frequently
cross-sells its services to provide a single source solution for client
projects. Founded as a Wisconsin corporation in 1977, the Company initially
concentrated on bulk mailing and commercial printing projects. Over the years,
the Company's business has expanded to include other related services.

         As a result of its performance during recent fiscal years, the Company
has considered, and continues to consider, a variety of options for building its
business and operations in order to position the Company for strengthened future
performance. As part of a strategy to focus its business on three core
competencies of packaging, printing, and direct mail, the Company divested
itself of the operations of its Outlook Foods, Inc. subsidiary ("Foods") in May
1998 and its former Barrier Films Corporation subsidiary ("Barrier") in May
1997, as it determined that those operations did not complement its other
continuing market lines. The Company also sold its Oshkosh, Wisconsin and
Wichita, Kansas facilities, which were no longer needed, to redeploy capital
resources.

         As part of its ongoing consideration of strategic alternatives, the
Company is continuing to consider divestiture strategies to the extent that the
Company believes such actions would enhance its ability to achieve successful
operations. In addition, the Company will also consider appropriate acquisitions
to strengthen continuing operations. There can be no assurances, however, that
the Company will be able to successfully implement such strategies or complete
those transactions.

         The following table sets forth the approximate amount from continuing
operations during the last three fiscal years, as well as net sales from
discontinued operations (Foods Processing):

<TABLE>
<CAPTION>
                                                                FISCAL YEAR ENDED MAY 31,
                                                --------------------------------------------------------
                                                     1999                1998                1997
                                                ---------------    ----------------     ----------------
                                                      (DOLLARS IN THOUSANDS)

<S>                                                <C>              <C>                  <C>
Continuing Operations................              $67,086            $66,951               $72,054
                                                    ======             ======                ======
Discontinued Operations:
 Food Processing.....................                -0-               15,460                16,804
                                                     ---               ------                ------
   Total.............................              $67,086            $82,411               $88,858
                                                    ======             ======                ======
</TABLE>


         The Company offers a broad array of packaging, specialty printing, and
direct mail services. The Company focuses on promotional contract packaging,
collateral information and distribution, direct mail components and services,
packaging materials (including printing), and commercial printing. The product
lines include folding cartons and paperboard packaging, overwrapping, flexible
film printing and laminating, coupons, labels, recipe cards and promotional
materials as well as traditional commercial printing of booklets, annual
reports, notepads and brochures.

         The Company has three reportable segments that are strategic business
units that offer different products and services. These business units are:
Outlook Graphics, Outlook Label Systems, and Outlook Packaging.

         Primarily through its Outlook Graphics division ("Outlook Graphics"),
the Company's pre-press staff prepares projects for printing to customer
specifications. These services include preparatory camera or computerized
plate-making, layout, typesetting and other related services. Although Outlook
Graphics does not generally perform pre-press design services, it assists
designers in translating a concept into a printed product.


<PAGE>   3
                                                                               2
         Outlook Graphics' presses generally use the off-set printing process
and can print on a wide range of media from newsprint and coated paper to heavy
board, including paperboard packaging. Outlook Graphics currently utilizes
sheet-fed full-color presses of various sizes, the most sophisticated of which
are capable of six-color printing. Certain presses have interchangeable printing
plates that allow the Company significant flexibility in meeting customer needs.

         Outlook Graphics also provides finishing services for printed items
(whether or not printed by the Company) such as precision trimming, folding and
gluing, die-cutting, binding, shrink-wrapping, collating and packaging products
for mailing and distribution. Outlook Graphics has also developed paperboard
packaging capabilities to serve its customers' needs and enhance the Company's
single source solution approach. Paperboard packaging consists of utilizing
paperboard stock to print and convert folding cartons, blister cards, pocket
folders and other point of purchase materials.

         The Company's promotional contract packaging capabilities include
packaging for many other types of items. Recent examples include promotional CD
ROMs for mailing, wrapping toys and other promotional items for insertion in
cereal boxes, overwrapping packages and packaging items for vending machines.
Custom-designed feeding and in-line overwrapping systems increase the efficiency
of its packaging operations. Outlook Graphics also maintains an environmentally
controlled work area to perform food contract packaging and to provide other
packaging services for which cleanliness and specific quality standards are
required.

         Other services provided by the Company include direct mailing and
distribution. Direct mailing involves literature overwrapping, labeling,
personalizing, inserting, sorting and shipping printed items for bulk mailing.
The Company's zip code sorting allows it to minimize customer postal charges by,
in many instances, delivering items by common carrier to a post office near the
destination. The Company is also "Alternative Procedures" qualified by the US
Postal Service, which provides it the ability to accelerate the cycle for moving
materials to the end user. Direct mailings in fiscal 1999 included promotional
CD ROM packages, catalogs, coupon packages and promotional materials.

         The collateral information management services provided by the Company
consist of storing and distributing items upon customer order. In most cases,
distribution items are materials such as forms and booklets that are printed by
the Company, often under standing orders from its customers to replenish
supplies. Custom designed data systems produce reports to assist the Company's
customers in managing their fulfillment programs. The Company has de-emphasized
distribution operations which do not involve materials printed or packaged by
the Company.

                  The Company's Outlook Label Systems, Inc. subsidiary ("Outlook
Label") complements the Company's other specialty printing operations by using
flexographic and rotary letterpress printing presses and offering manufacturing
capabilities not otherwise available from the Company, enhancing the Company's
ability to cross-sell services. Outlook Label manufactures items such as
coupons, pressure sensitive specialty labels, printed vinyl cards (such as
temporary credit cards and identification cards), continuous forms, cartons, and
sweepstakes and specialty game pieces. Its most sophisticated machinery permits
one-pass, 14-color printing and lamination of various substrates using an
in-line process.

                  The Company's Outlook Packaging, Inc. subsidiary ("Outlook
Packaging") engages in flexographic printing and laminating of flexible
packaging films and papers. In these processes, Outlook Packaging takes flexible
packaging materials (which are purchased from others) and prints, laminates
and/or slits the material to customer specifications. Customer orders may
include some or all of Outlook Packaging's services. Outlook Packaging
specializes in printing packaging materials for the food industry and is
expanding in the industrial and consumer packaging markets. Outlook Packaging
prints and laminates materials for items such as pouches, bags, vacuum packages,
packets, security devices and card and food overwraps, and provides them to
customers in convenient rolls of film.



<PAGE>   4
                                                                               3
RECENT DEVELOPMENTS

                  The Company recently completed several acquisitions of assets
and businesses as a means of enhancing utilization of its facilities and its
service offerings. In November 1997, the Company acquired selected operations of
General Converting, another flexible packaging company, which Outlook Packaging
was able to continue in its existing Oak Creek facilities. In February 1999, the
Company acquired, from the same company that had owned the assets of General
Converting, specified additional business of Plicon Corporation. In October
1998, the Company acquired selected assets of Precision Paper Converters, Inc.,
a paper sheeting company, of Sherwood, Wisconsin; the acquired assets and
operation have been integrated into Outlook Graphics. In March 1999, the Company
acquired certain assets of Kostner Graphics, a commercial printing company,
which the Company has integrated into its Outlook Graphics operations.

DISCONTINUED OPERATIONS/FOOD PROCESSING OPERATIONS

         In September 1996, the Company announced plans to divest its food
processing business, and began to account for those operations as a discontinued
operation. In May 1998, the Company entered into an agreement to sell the assets
of its Foods subsidiary to Lake Country Foods, Inc. and Lake Country Properties,
LLC, and simultaneously closed the transaction.

CUSTOMERS AND MARKETING

         Due to the project-oriented nature of the Company's business, sales to
particular customers may vary significantly from year to year, and period to
period, depending upon the number and size of their projects. The identity of
those customers also may change.

         During fiscal 1999, sales to America Online, Inc. (AOL) were 13% of the
Company's total net sales. Sales to AOL in fiscal 1998 were 1% of total net
sales from continuing operations and in fiscal 1997 were 0% of total net sales
from continuing operations. Also, during fiscal 1999, sales to Kimberly-Clark
Corporation (KC) were 12% of the Company's total net sales from continuing
operations for the period; sales to KC were 9% and 7% of the Company's total net
sales from continuing operations in fiscal 1998 and 1997, respectively. During
fiscal 1999, sales to Kraft Foods, Inc. (and affiliates) ("Kraft") accounted for
approximately 6% of the Company's total net sales from continuing operations for
the period; sales to Kraft were 10% and 14% of the Company's total net sales
from continuing operations in fiscal 1998 and 1997, respectively. This decrease
in sales to Kraft is attributable to a decrease in promotion and premium
activity on the part of Kraft; in addition, the Company sold much of its
fulfillment business during fiscal 1998 and had no fulfillment sales to Kraft
during fiscal 1999. Sales to Kraft represent sales to several Kraft divisions
and subsidiaries. The Company performs various services on behalf of these
clients, such as, printing, production of labels and contract packaging. As with
most of its customers, the Company's sales to these customers are pursuant to
cancelable purchase orders. In particular, sales to AOL depend upon the timing
of AOL marketing initiatives which can change frequently and vary significantly
from period to period. There is no assurance that these sales will continue in
the future.

         The Company expects that it will continue to experience significant
sales concentration given the relatively large size of projects undertaken for
certain customers. Furthermore, the Company's largest customers may vary from
year to year depending on the number and size of the projects completed for such
customers. The loss of business of one or more principal customers or a change
in the number or character of projects for particular customers could have a
material adverse effect on the Company's sales volume and profitability.

         Customers generally purchase the Company's services under cancelable
purchase orders rather than long-term contracts, although exceptions sometimes
occur when the Company is required to purchase substantial inventories or
special machinery to meet orders. The Company believes that operating without
long-term contracts is consistent with industry practices, although it increases
the Company's vulnerability to significant period to period changes. Because of
the project-oriented nature of the Company's business, the short-term character
of a substantial portion of its projects and the nature of the orders for the
Company's services, the Company does not believe that backlog is material or
meaningful to its business.


<PAGE>   5
                                                                               4
         The Company markets its services nationally through certain of its
executive officers and its centralized sales group which at July 31, 1999
included 37 sales and service employees and 12 manufacturer's representatives.
The sales group is intended to centralize and coordinate sales and marketing
activities among the Company's various operations. The Company generally does
not enter into employment contracts with its officers (other than its COO) and
employee sales personnel, although it has agreements with its outside
representatives.

RAW MATERIALS

         In the Company's graphic services operations, raw materials necessary
to the Company include paper stocks, inks and plastic films, all of which are
readily available from numerous suppliers. The cost of raw materials represented
approximately 43% of the Company's cost of goods sold from continuing operations
during fiscal 1999, as compared to 47% in fiscal 1998. The Company has not
experienced difficulties in obtaining materials for its continuing operations in
the past and does not consider itself dependent on any particular supplier for
raw materials, or for the Company's equipment needs.

COMPETITION

         The market for the services provided by the Company is highly
competitive, primarily on the basis of price, quality, production capability,
capacity for prompt delivery and continuing relationships.

         The Company's principal competitors, and the scope of the areas in
which the Company competes, vary based upon the services offered. With respect
to specialty printing services, its competitors are numerous and range in size
from very large multi-national companies with substantially greater resources
than the Company to many smaller local companies. Numerous competitors also
exist for other services. While there are fewer competitors offering converting
and packaging services, competition is very strong. The Company believes that
relatively few competitors offer the wide range of services provided by the
Company. Because of the substantial capital requirements for graphic services
equipment, larger companies with greater capital resources may have an advantage
in financing state-of-the-art equipment. The Company does not believe foreign
competition is significant at this time.

YEAR 2000 COMPLIANCE

         The Company has taken, and is continuing to take, actions intended to
assure that its computer systems and other equipment are capable of functioning
in, and processing for periods for the Year 2000 and beyond. The Company has
implemented a program intended to address, on a timely basis, "Year 2000
Compliance" (the need for computer applications and other systems used by the
Company to function in and after the Year 2000 and to recognize and properly
perform date sensitive functions involving dates after December 31, 1999). See
"Year 2000 Compliance" in the Company's Management's Discussion and Analysis" at
Item 7 of this report.

ENVIRONMENTAL MATTERS

         The Company and the industry in which it operates are subject to
environmental laws and regulations concerning emissions into the air, discharges
into waterways and the generation, handling and disposal of waste materials.
These laws and regulations are constantly evolving, and it is impossible to
predict accurately the effect they may have upon the capital expenditures,
earnings and competitive position of the Company in the future. The Company's
past expenditures relating to environmental compliance have not had a material
effect on the Company. Growth in the Company's production capacity with a
resultant increase in discharges and emissions could require significant capital
expenditures for environmental control facilities in the future.

EMPLOYEES

         At July 31, 1999, the Company had 604 full-time employees. The Company
contracts for and/or hires temporary employees to increase the number of
personnel in certain operations as project commitments require. The Company
considers its relationship with its employees to be good. Wages and employee
benefits in continuing

<PAGE>   6
                                                                               5
operations represented approximately 31% and 28% of the Company's cost of goods
sold in continuing operations during fiscal 1999 and 1998, respectively.




ITEM 2.        PROPERTIES.

         The Company's offices and main production and distribution facilities
are located in the Town of Menasha, Wisconsin in a facility owned by the
Company. The 345,000 square foot facility (of which approximately 25,000 square
feet are used for offices) was built in stages from 1980 to 1992. The Company
also owns approximately five acres of land adjacent to this facility to provide
for future expansion, if needed.

         The Company owns an 83,000 square foot facility in Neenah, Wisconsin in
which Outlook Label's office and production facilities are located. This
facility provides capacity for future expansion of Outlook Label as well as for
other operations of the Company, if needed.

         The Company owns an 81,000 square foot facility in Oak Creek, Wisconsin
in which Outlook Packaging's office and production facilities are located. The
building was constructed in 1990, and was purchased by the Company in 1993. The
Company also owns approximately four acres of land adjacent to this facility.

         The Company leases an approximately 75,000 square foot facility in
Neenah, Wisconsin that is currently used for certain mailing operations and
warehouse space. The lease for this facility expires on March 30, 2002. The
Company must provide six months notice of its intention to vacate or the lease
continues on a year-to-year basis. The Company also leases an approximately
37,500 square foot facility in Neenah, Wisconsin for its sheeting operations and
other warehouse space. The lease is for a ten year term, with one five year
option to renew.

         In addition to land and buildings, the Company maintains significant
complex and specialized equipment to perform its various graphic services. The
equipment includes presses, machinery dedicated to converting and packaging, and
other machinery described above in Item 1. Certain of the equipment is leased by
the Company; see Note G of Notes to Consolidated Financial Statements elsewhere
in this report for a description of equipment lease transactions. The Company is
dependent upon the functioning of such machinery and equipment, and its ability
to acquire and maintain appropriate equipment. Among other factors, the Company
may be affected by equipment malfunctions, training and operational needs
relating to the equipment, which may delay its utilization, maintenance
requirements, and technological or mechanical obsolescence. Because of the
substantial capital requirements for graphic services equipment in particular,
larger companies with greater capital resources may have an advantage in
financing state-of-the-art equipment.


         The Company believes that all of its facilities are in good condition
and suited for their present purpose. The Company believes that the property and
equipment currently utilized by it is sufficient for its currently anticipated
needs but that expansion of the Company's business or offering new services
could require the Company to obtain additional equipment or facilities. The
Company regularly evaluates its facility and equipment needs and would sell, or
terminate leases to, facilities or equipment if appropriate.

         Substantially all of the Company's assets are pledged as collateral
under financing agreements. See Note C of Notes to Consolidated Financial
Statements, which is incorporated herein by reference, for a description of
financing secured by mortgages on the properties and equipment owned by the
Company and its subsidiaries.





<PAGE>   7
                                                                               6


ITEM 3.  LEGAL PROCEEDINGS.

         The Company has been named as a defendant in an action captioned
Barrier Films Ltd.--New York ["Barrier-NY"] versus Outlook Group, Inc., and
Joseph Baksha, filed in the Supreme Court of the State of New York (Suffolk
County), Index No. 99-08965, on April 29, 1999. The Company removed the case to
the U.S. District Court for the Eastern District of New York, Civil No.
99-CV-3057 (LDW), on June 1, 1999.

         This suit alleges various causes of action which arise out of the
acquisition of Barrier Films Corporation ("BFC") by Barrier-NY from the Company
in May 1997. Barrier's complaint, as amended, has multiple counts, with
overlapping claims that can be summarized as: (a) various allegations and causes
of action arising from the alleged failure of the Company to comply with closing
obligations relating to consents by former BFC officers under their employment
agreements; (b) alleged tortuous interference with Barrier-NY's customer
relationship with a customer of BFC prior to the transaction; (c) various claims
that the Company failed to comply with its obligations under a related Rebate
and Supply Agreement; (d) allegations that the Company either misappropriated or
disclosed certain confidential BFC information, and (e) a request for a judgment
declaring the 1997 promissory note executed by Barrier-NY in the BFC acquisition
unenforceable, null and void. Because the complaint presents overlapping claims,
and requests multiple awards of damages for the same underlying facts,
determining the actual amount at issue is uncertain; however, all of the claims
made total $27.65 million, plus elimination of the note, plus requests for costs
and punitive damages, without any attempt to adjust the claims for multiple
requests resulting from overlapping causes of action.

         The Company has answered denying liability and has a counterclaim for
more than $2.6 million, plus costs and other damages, as a result of
Barrier-NY's failure to make payments due the Company under the 1997 promissory
note and under the Purchase and Sale Agreement in connection with the sale of
BFC. The litigation is at a very early stage. No discovery yet has been taken.
However, the Company believes that Barrier-NY's claims are without merit, and
intends to defend the matter, and to pursue its counterclaim, vigorously and
aggressively.

         Other than the foregoing, in the opinion of management, the
Company is not a defendant in any legal proceedings other than routine
litigation that is not material to its business.

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

         No matters were submitted to a vote of security holders during the
fourth quarter of fiscal 1999.


EXECUTIVE OFFICERS OF THE REGISTRANT.

         Certain information as to each of the executive officers of the Company
is set forth in the following table. Officers are elected annually by the Board
of Directors.

<TABLE>
<CAPTION>

                NAME                          AGE                          POSITION(S)
                ----                          ---                          -----------


<S>                                           <C>      <C>
      Richard C. Fischer................      60       Chairman of the Board and Chief Executive Officer; Director

      Joseph J. Baksha..................      47       President and Chief Operating Officer; Director

      Jeffry H. Collier ................      46       Executive Vice President; Vice President and General
                                                       Manager of Outlook Graphics; Director

      Paul M. Drewek....................      53       Chief Financial Officer
-----------------------
</TABLE>

<PAGE>   8
                                                                               7
         Richard C. Fischer has served as Chairman of the Board and Chief
Executive Officer of the Company since December 1997; he has been a director of
the Company since 1995. Mr. Fischer has been an investment banker with B.C.
Ziegler & Co. since 1999, previously having been an investment banker with
Fischer and Associates LLC from 1995 to 1999, and previously with Robert W.
Baird & Co., Incorporated.

         Joseph J. Baksha has served as President and Chief Operating Officer
since December 1996, after having served as Vice President of the Company and
President of Outlook Packaging since June 1996. Previously, Mr. Baksha served as
Executive Vice President and Chief Operating Officer of Washburn International
(a manufacturer and distributor of musical instruments) from 1994 to 1996, and
previously as Executive Vice President and Chief Operating Officer of Alusuisse
Flexible Packaging (a flexible packaging company).

         Jeffry H. Collier has served as Executive Vice President of the Company
since 1994, President of the Outlook Graphics division since 1996 and a Vice
President of the Company since 1990. Previously, Mr. Collier was employed by the
Company as its plant manager and General Manager of Outlook Label.

         Paul M. Drewek became the Company's Chief Financial Officer in May
1998. Mr. Drewek acted as principal of Drewek & Associates (accounting and
management consulting) from 1997 to 1998. Previously, Mr. Drewek served as Chief
Financial Officer of Allied Computer Group Companies, Inc. (a computer systems
integrator and consulting company) from 1995 to 1997, and prior thereto as Vice
President - Finance and Administration and Treasurer-CFO of Joiner Associates
Incorporated (a consulting and publishing company specializing in total quality
management). Mr. Drewek also is deemed the Company's principal accounting
officer.

                                    * * * * *

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

         The discussions in this report on Form 10-K, and in the documents
incorporated herein by reference, and oral presentations made by or on behalf of
the Company contain or may contain various forward-looking statements
(particularly those referring to expectations as to possible strategic
alternatives, future business and/or operations, in the future tense, or using
terms such as "believe", "anticipate," "expect" or "intend") that involve risks
and uncertainties. The Company's actual future results could differ materially
from those discussed, due to the factors which are noted in connection with the
statements and other factors. The factors that could cause or contribute to such
differences include, but are not limited to, those further described in Items 1
and 2 above in this report and in the "Management's Discussion and Analysis"
(particularly in "Results of Operations--Fiscal 1999 Compared to Fiscal 1998")
in Item 7 hereof.


<PAGE>   9
                                                                              8

                                     PART II

ITEM 5.        MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
               MATTERS.

         The Company's common stock is quoted on the NASDAQ Stock Market. The
following table sets forth high and low sales prices as reported on NASDAQ by
quarter for the indicated fiscal years.

                  FISCAL 1999                        High               Low
                  -----------                        ----               ---
                           Fourth quarter            $4.13             $1.88
                           Third quarter              4.63              3.63
                           Second quarter             4.44              3.13
                           First quarter              6.00              3.50



                  FISCAL 1998                        High               Low
                  -----------                        ----               ---



                           Fourth quarter            $6.25             $5.50
                           Third quarter              7.44              5.75
                           Second quarter             7.75              4.50
                           First quarter              8.00              4.31


         The Company has not paid any cash dividends since its inception. The
Company presently intends to employ its earnings in the continued development
and expansion of its business and does not expect to pay any cash dividends in
the foreseeable future. For a description of contractual dividend restrictions,
see Note C of Notes to the Consolidated Financial Statements and the discussion
in Management's Discussion and Analysis.

         As of August 9, 1999, the Company had approximately 497 registered
shareholders of record.






<PAGE>   10
                                                                               9


ITEM 6.          SELECTED FINANCIAL DATA.

         The following selected financial data of the Company have been derived
from the Company's audited consolidated financial statements and should be read
in conjunction with the consolidated financial statements, related notes and
Management's Discussion and Analysis contained in this report. Information for
years prior to 1999 has been restated to reflect the Company's subsidiary,
Outlook Foods, Inc., as a discontinued operation; see Note L to the Consolidated
Financial Statements.

<TABLE>
<CAPTION>

FISCAL YEAR ENDED MAY 31,
(in thousands, except share and per share amounts)                        1999        1998        1997(1)       1996        1995(1)
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>          <C>          <C>            <C>           <C>
EARNINGS STATEMENT DATA:
Net Sales                                                              $ 67,086     $ 66,951     $ 72,054     $ 79,305     $ 91,620
Cost of goods sold                                                       54,242       54,545       61,168       74,683       77,046
-----------------------------------------------------------------------------------------------------------------------------------
Gross profit                                                             12,844       12,406       10,886        4,622       14,574
Selling, general and administrative expenses                             10,554       10,454        9,904       13,347       13,303
-----------------------------------------------------------------------------------------------------------------------------------
Operating profit (loss)                                                   2,290        1,952          982       (8,725)       1,271
Other income (expense):
     Interest expense                                                      (627)      (1,968)      (2,778)      (2,506)      (1,930)
     Other income                                                           609        1,409          746        1,609          959
     Gain on sale of subsidiary                                              --           --          556           --           --
-----------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) from continuing operations
     before income taxes                                                  2,272        1,393         (494)      (9,622)         300
Income tax expense (benefit)                                                877          640           58       (3,659)         118
-----------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) from continuing operations                                1,395          753         (552)      (5,963)         182
Discontinued Operations:
     Earnings (loss) from discontinued
       operations before income taxes                                        --         (916)      (1,492)         658        1,829
     Income tax expense (benefit)                                            --            4         (574)         253          726
-----------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) from discontinued operations                                 --         (920)        (918)         405        1,103
-----------------------------------------------------------------------------------------------------------------------------------
Net earnings (loss)                                                    $  1,395     $   (167)    $ (1,470)    $ (5,558)    $  1,285
-----------------------------------------------------------------------------------------------------------------------------------
Net earnings (loss) per common share - Basic

Continuing operations                                                  $    .30     $    .16     $   (.12)    $  (1.28)    $    .04

Discontinued operations                                                      --         (.20)        (.20)         .09          .22
-----------------------------------------------------------------------------------------------------------------------------------
     Total                                                             $    .30     $   (.04)    $   (.32)    $  (1.19)    $    .26

-----------------------------------------------------------------------------------------------------------------------------------
Net earnings (loss) per common share - Diluted

Continuing operations                                                  $    .30     $    .16     $   (.12)    $  (1.26)    $    .04

Discontinued operations                                                      --         (.20)        (.20)         .09          .22
-----------------------------------------------------------------------------------------------------------------------------------
     Total                                                             $    .30     $   (.04)    $   (.32)    $  (1.17)    $    .26

-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>   11
                                                                              10
<TABLE>

<S>                                                       <C>           <C>          <C>            <C>           <C>
Weighted average number of common shares
     outstanding - Basic                                  4,667,132     4,662,460    4,649,382      4,661,882     4,884,607
                 - Diluted                                4,667,542     4,692,522    4,700,551      4,715,887     4,986,491

----------------------------------------------------------------------------------------------------------------------------

BALANCE SHEET DATA (AT FISCAL YEAR END):
Working capital                                             $14,008      $ 14,185     $ 11,368  $      23,700      $ 24,260
----------------------------------------------------------------------------------------------------------------------------
Total assets                                                 51,766        53,457       67,620         77,853        83,373
----------------------------------------------------------------------------------------------------------------------------
Long-term debt, less current maturities                       4,753         7,061       16,156         30,859        24,991
----------------------------------------------------------------------------------------------------------------------------
Shareholders' equity                                         34,678        33,383       33,471         34,941        41,386
----------------------------------------------------------------------------------------------------------------------------
</TABLE>


(1)      Includes the results of operations of the company's subsidiary, Barrier
         Films Corp. ("Barrier"), from February 11, 1995 until May 15, 1997.



ITEM 7.          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS.

         The following section presents a discussion and analysis of the
Company's results and operations during the past three fiscal years, and its
financial condition at fiscal year end. Statements that are not historical facts
(such as statements in future tense or using terms such as "believe" "expect" or
"anticipate") are forward-looking statements that involve risks and
uncertainties. The Company's actual future results could materially differ from
those discussed. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed in the following sections,
particularly under "General Factors" in "Results of Operations - Fiscal 1999
Compared to Fiscal 1998".

         In September 1996, the Company announced that it intended to divest its
food processing operations. As a consequence, beginning in November 1996, the
Company began accounting for the food processing business as a discontinued
operation. Information prior to that time has been restated to reflect this
change in accounting, unless specifically indicated otherwise. The food
processing operation was sold in May 1998.

RESULTS OF OPERATIONS

         The following table shows, for the fiscal years indicated, certain
items from the Company's consolidated statements of operations expressed as a
percentage of net sales.
<PAGE>   12
                                                                              11
<TABLE>
<CAPTION>

YEAR ENDED MAY 31,                                                     Percentage of Net Sales

                                                         1999                   1998            1997

<S>                                                      <C>                    <C>            <C>
Net sales                                                100.0%                 100.0%          100.0%
Cost of goods sold                                        80.9                   81.5            84.9
                                                        -----------------------------------------------
Gross profit                                              19.1                   18.5            15.1
Selling, general and
   administrative expenses                                15.7                   15.6            13.7
                                                         ----------------------------------------------
Operating profit (loss)                                    3.4                    2.9             1.4
Other income (expense):
   Interest expense                                        (.9)                  (2.9)           (3.9)
   Interest and other income                                .9                    2.1             1.0
   Gain on sale of subsidiary                               --                     --              .8
                                                        -----------------------------------------------

Earnings (loss) from continuing operations
   before income taxes                                     3.4                    2.1             (.7)
Income tax expense                                         1.3                    1.0              .1
                                                        -----------------------------------------------
Earnings (loss) from continuing operations                 2.1                    1.1             (.8)
                                                        -----------------------------------------------
Discontinued operations:
   Earnings (loss) from discontinued
   operations before income taxes                           --                   (1.4)           (2.1)
   Income tax expense (benefit)                             --                     --             (.8)
                                                        -----------------------------------------------
Earnings (loss) from discontinued operations                --                   (1.4)           (1.3)
                                                        -----------------------------------------------

Net earnings (loss)                                        2.1%                  (0.3)%          (2.0)%
                                                        -----------------------------------------------
</TABLE>

FISCAL 1999 COMPARED TO FISCAL 1998

            The Company's net sales from continuing operations were $67.1
million for fiscal 1999, up slightly from fiscal 1998 sales of $67.0 million.
The Graphics business segment had a net increase in sales of $5.7 million, the
Label segment and Packaging segments had net decreases of $1.0 million and $4.6
million, respectively. In the Graphics segment, the Company had gains of $1.0
million in contract packaging, $6.7 million in direct mail business and $1.2
million in collateral management markets; the Company had decreases of $7.0
million in sales in packaging and $1.8 million in specialty printing markets.
Approximately $4.3 million of the decrease in the Packaging segment was in the
snack food markets and approximately $0.4 million of the decrease was in the
produce markets. The acquisition made in the commercial print market did not
have a substantial impact on fiscal 1999 operations because the transaction
closed during the fourth quarter of the Company's fiscal year.

           Gross profit as a percentage of net sales improved to 19.1% in fiscal
1999 from 18.5% in fiscal 1998. Gross profit increased $0.4 million from 1998 to
$12.8 million. This improvement is primarily the result of the Company's
continued efforts to increase sales with relatively less material costs as a
percentage of sales. These increases were in the contract packaging and direct
mail businesses. The Company also benefited from its continuing program to more
efficiently use materials and personnel. Surplus equipment that had previously
been used for the sports and collectible picture card market were put to
alternative use or were sold. Inventory writeoffs were approximately $250,000 in
fiscal 1999 and $500,000 in fiscal 1998. Management is continuing its programs
to further reduce inventory to desired levels and does not currently believe
that additional material costs will be incurred on the reductions. However,
actual results are dependent on the ability of the Company to find buyers for
slower moving materials or to use materials in the normal course of business.

           Selling, general and administrative expenses increased slightly in
fiscal 1999 and represent 15.7% of net sales as compared to 15.6% in fiscal
1998. In fiscal 1999, the Company had increases of $80,000 in wages, $100,000 in
health and medical insurance costs, $150,000 in broker commission expense, and
$260,000 in other administrative expenses, of which the majority of the increase
represented recruiting and contract labor expense. In fiscal 1999, bad debt
expense decreased $450,000 and depreciation decreased $100,000 from fiscal year
1998.

             Interest expense decreased $1.3 million from 1998 due to the
decrease in total debt. Interest expense as a percent of net sales decreased to
0.9% in fiscal 1999 versus 2.9% in fiscal 1998
<PAGE>   13
                                                                              12

         Other income decreased $800,000 from 1998 to 0.9% of sales in fiscal
1999 as compared to 2.1% of sales in fiscal 1998. The $600,000 of other income
in fiscal 1999 is primarily composed of interest income from notes receivable of
approximately $450,000 and recycling revenue of approximately $180,000. Fiscal
1998 other income included $1.2 million of gain on the sales of fixed assets
including the land, building and equipment related to fulfillment operations
previously located in Oshkosh, Wisconsin.

         Fiscal 1999 pretax earnings from continuing operations of $2.3 million
represent a $900,000 increase from the fiscal 1998 level of $1.4 million. Pretax
earnings from continuing operations was 3.4% of net sales in fiscal 1999 as
compared to 2.1% of net sales in fiscal 1998. In fiscal 1999, the Company
recorded a tax provision of $877,000 or 1.3% of net sales as compared to the
fiscal 1998 tax provision of $640,000 or 1.0% of net sales.

         Outlook Foods, accounted for as a discontinued operation, was sold as
of May 1, 1998 and did not affect 1999 results. In fiscal 1998, a loss of
approximately $860,000 was realized as a result of this sale transaction. Up to
May 1, 1998 the Foods operations generated $15.5 million of sales and $60,000 of
pretax loss. Discontinued operations resulted in an approximately $900,000 net
loss in fiscal 1998.

         In summary, fiscal 1999 yielded net earnings of $0.30 per share, all
earnings from continuing operations. Fiscal 1998 yielded a net loss of $0.04 per
share, comprised of earnings from continuing operations of $0.16 per share, and
a net loss from discontinued operations of $0.20 per share.

FISCAL 1998 COMPARED TO FISCAL 1997

         Outlook Group net sales from continuing operations were $67.0 million
for fiscal 1998, a decrease of $5.1 million or 7% from fiscal 1997 sales of
$72.1 million. The major factor for this decline is the loss of sales from its
Barrier Films Corp. ("Barrier") subsidiary. Barrier, sold in May 1997, had net
sales of $6.6 million in fiscal 1997. The Company was able to offset the lost
revenue from this subsidiary by focusing its efforts on new markets for its core
production competencies as well as acquiring a book of business from General
Converting in its packaging operations, which accounted for $1.6 million of
sales in fiscal 1998. The Company also experienced a $2.0 million gain in its
sales of paperboard cartons. Sales decreases of approximately $3.0 million
occurred in direct mail and specialty printing services. Company sales related
to sports and other collectible picture cards remained insignificant.

         Gross profit as a percentage of net sales improved to 18.5% in fiscal
1998 from 15.1% in fiscal 1997. Gross profit increased $1.5 million over 1997 to
$12.4 million. This improvement resulted from more efficient utilization of
material and personnel reductions. Reduced material costs resulted from
continuing programs developed to more effectively utilize material and reduce
scrap. In addition, sales with relatively less material costs increased as a
percentage of sales. Surplus equipment that had previously been utilized
primarily for the sports and collectible picture card market were put to
alternative use or were sold. Inventory write-offs were approximately $500,000
in both fiscal 1998 and fiscal 1997. Management has developed a program to
further reduce inventory to desired levels and does not currently believe that
additional material costs will be incurred on the disposition. However, actual
results will be determined by the ability to attract buyers or use materials in
the normal course of business.

         Selling, general and administrative expenses increased $550,000 in
fiscal 1998 and represent 15.6% of net sales as compared to 13.7% in the prior
year. Increases are attributable to increased expenses related to an expanded
sales force and increases in professional service expenses related to
divestitures, acquisitions, and sale of operating assets. This included
approximately $200,000 of expenses related in the proposed sale of the Company.

         Interest expense as a percent of net sales decreased to 2.9% in fiscal
1998 versus 3.9% in fiscal 1997. Interest expense decreased $810,000 from 1997
due to the decrease in total debt. Because a significant portion of the debt was
not repaid until the May 1998 sale of Outlook Foods, the reduction of interest
paid in fiscal 1998 was not as great relative to the total reduction of debt.
<PAGE>   14
                                                                              13

         Other income increased to $1.4 million or 2.1% of sales in fiscal 1998
as compared to 1.0% of sales in fiscal 1997. Of this amount, approximately $1.2
million represents gains on the sale of fixed assets, including the land,
building and equipment related to fulfillment operations located in Oshkosh,
Wisconsin. Continuing fulfillment operations have been moved to the Company's
Neenah facility.

         Fiscal 1998 pretax earnings from continuing operations of $1.4 million
represent a $1.9 million improvement in pretax earnings from continuing
operations compared to fiscal 1997. Pretax income from continuing operations was
2.1% of net sales in fiscal 1998 as compared to a pretax loss from continuing
operations of 0.7% in fiscal 1997. The Company recorded a tax provision of
$640,000, or 1.0% of net sales, that also included an adjustment to the deferred
tax liability accounts.

         Outlook Foods, accounted for as a discontinued operation, was sold as
of May 1, 1998. The Company had announced its intention to divest Foods in
September 1996; since that time, the Company has accounted for its food
processing operations as a discontinued operation. A loss of approximately
$860,000 was realized as a result of this transaction. Up to May 1, the Foods
operations generated $15.5 million of sales and $60,000 of pretax loss.
Discontinued operations resulted in an approximately $900,000 net loss in both
fiscal 1998 and fiscal 1997.

         In summary, fiscal 1998 yielded a net loss of $0.04 per share,
comprised of earnings from continuing operations of $0.16 per share, and a net
loss from discontinued operations of $0.20 per share. Fiscal 1997 yielded a net
loss of $0.32 per share, comprised of a net loss from continuing operations of
$0.12 per share, and a net loss from discontinued operations of $0.20 per share.

         GENERAL FACTORS

         Because of the project-oriented nature of the Company's business, the
Company's largest customers have historically tended to vary from year to year
depending on the number and size of the projects completed for these customers.
During fiscal 1999, sales to America Online, Inc. (AOL) were 13% of the
Company's total net sales. Sales to AOL in fiscal 1998 were 1% of total net
sales from continuing operations and in fiscal 1997 were 0% of total net sales
from continuing operations. Also, during fiscal 1999, sales to Kimberly-Clark
Corporation (KC) were 12% of the Company's total net sales from continuing
operations for the period; sales to KC were 9% and 7% of the Company's total net
sales from continuing operations in fiscal 1998 and 1997, respectively. During
fiscal 1999, sales to Kraft Foods, Inc. (and affiliates) ("Kraft") accounted for
approximately 6% of the Company's total net sales from continuing operations for
the period; sales to Kraft were 10% and 14% of the Company's total net sales
from continuing operations in fiscal 1998 and 1997, respectively. This decrease
in sales to Kraft is attributable to a decrease in promotion and premium
activity on the part of Kraft; in addition, the Company sold much of its
fulfillment business during fiscal 1998 and had no fulfillment sales to Kraft
during fiscal 1999. Sales to Kraft represent sales to several Kraft divisions
and subsidiaries. The Company performs various services on behalf of these
clients, such as, printing, production of labels and contract packaging. Changes
in the Company's project mix and timing of projects make predictability of the
Company's future results very difficult. In particular, sales to AOL depend upon
the timing of AOL marketing initiatives which can change frequently and vary
significantly from period to period. Additional changes in the Company's project
mix and customer base could affect future sales volume and profitability.

         The Company expects that it will continue to experience significant
sales concentration given the relatively large size of projects undertaken for
certain customers. Furthermore, the Company's largest customers may vary from
year to year depending on the number and size of the projects completed for such
customers. The loss of business of one or more principal customers or a change
in the number or character of projects for particular customers could have a
material adverse effect on the Company's sales volume and profitability.

         Customers generally purchase the Company's services under cancelable
purchase orders rather than long-term contracts, although exceptions sometimes
occur when the company is required to purchase substantial inventories or
special machinery to meet orders. The Company believes that operating without
long-term contracts is consistent with industry practices, although it increases
the Company's vulnerability to losses of business and significant
period-to-period changes.
<PAGE>   15
                                                                              14

         The Company uses complex and specialized equipment to provide its
services, and manufacture its products. Therefore, the Company is dependent upon
the functioning of such machinery, and its ability to acquire and maintain
appropriate equipment.

LIQUIDITY AND CAPITAL RESOURCES

         As shown on the Consolidated Statements of Cash Flows, fiscal 1999 cash
provided from operating activities was $6.4 million as compared to $9.2 million
in fiscal 1998. The Company's cash position was reduced by $6.0 million used for
acquiring property plant and equipment, purchasing businesses, and giving a loan
to an officer for the purchase of stock. In addition, the Company used cash to
pay down an additional $1.7 million of long-term debt.

         In addition to cash generated as a result of improved operations, the
Company's operating cash benefited by a $2.1 million reduction in accounts and
notes receivable, a $900,000 reduction in inventory, and a $200,000 reduction in
other assets. The Company's operating cash was reduced by a $1.5 million
reduction of accounts payable and a $600,000 reduction in accrued liabilities.
With respect to the reduction of accounts payable, approximately $1.6 million
related to receivables collected by the Company on behalf of the buyer of
Outlook Foods and other post-closing purchase price adjustments in fiscal 1998.
During fiscal 1999 the Company provided $0.4 million for additional reserves and
write-downs of receivables and inventory as compared to $1.2 million in fiscal
1998. The Company continues to monitor its inventory requirements and the credit
worthiness of its customers. Management continues its program to reduce
inventory to desired levels. At May 31, 1999, 21% of the company's accounts
receivable balance relates to one customer, AOL. As of August 9, 1999
substantially all of this balance had been paid.

         Cash from investing activities represents expenditures for additional
property, plant and equipment and the purchase of business from Precision
Sheeting and Kostner Graphics.

         Net cash used in financing activities was $1.3 million, of which
approximately $1.7 million represents the Company's net reduction of debt. The
balance represents an increase in a book balance cash overdraft. The Company was
able to reduce its debt as a result of cash available from improved management
of operations and working capital.

         The Company holds Notes Receivable from the Purchasers of its Barrier
operations that total approximately $2.4 million. The Company is currently in
litigation to collect those amounts, and the other party is making claims
against the Company, including the termination of the note. See Item
3-Litigation. The Company is also in the process of litigation to collect
another note that totals approximately $0.7 million. A failure of the Company to
collect these amounts, or amounts due under other notes or accounts receivable,
in excess of reserves, would adversely affect the Company's Balance Sheet and
results of operations.

         The Company maintains a credit facility with a bank, but has no
outstanding balances on the revolver. The facility provides for a maximum
revolving credit commitment of $15.0 million less $4.8 million used for standby
letters of credit. Interest on the debt outstanding during the year varied with
the Company's selection to have the debt be based upon margins over the bank
determined preference or a LIBOR rate. The Company's actual rate is dependent
upon the Company's performance against a specific ratio as measured against a
predetermined performance chart. As a result of its improved cash position, the
Company renegotiated its line of credit facility in May, 1999 and obtained less
costly loan fees and other improved terms and conditions.

         The Company anticipates capital expenditures of approximately $2.75
million in fiscal 2000, excluding any acquisition opportunities which may become
available to the Company. The Company intends to finance these expenditures
through funds obtained from operations plus its credit facilities and possible
leasing opportunities.

         In July, 1999 the Board of Directors authorized the repurchase of up to
1,000,000 shares of the Company's common stock in the open market. No timeframe
was set for completion of this program. As of August 9, 1999 the Company had
repurchased 43,700 shares for approximately $176,000.
<PAGE>   16
                                                                              15

         The Company regularly reassesses how its various operations complement
the Company as a whole and considers strategic decisions to acquire new
operations or expand, terminate or sell certain existing operations. These
reviews resulted in the transactions discussed above during recent fiscal years,
and may result in additional transactions during fiscal 2000 and beyond.

YEAR 2000 COMPLIANCE

         The Company has taken, and is continuing to take, actions intended to
assure that its computer systems and other equipment are capable of functioning
in, and processing for, periods for the Year 2000 and beyond. The Company has
implemented a program intended to address, on a timely basis, "Year 2000
Compliance" (the need for computer applications and other systems used by the
Company to function in and after the Year 2000 and to recognize and properly
perform date sensitive functions involving dates after December 31, 1999.)

         During the fourth quarter, the Company upgraded its existing production
and financial reporting systems. In addition, the Company tested additional
equipment for compliance, met with certain key customers and suppliers to
discuss potential issues, and continued to monitor whether contingency plans are
needed. Software upgrades were installed in mid-March and the systems were
tested during the fourth quarter.

         Based on the current status of the Company's compliance efforts, the
costs associated with identified Year 2000 compliance issues are not expected to
have a material effect on the results of operations or on the financial
condition of the Company. The Company has worked with its software vendors to
upgrade to software versions that are Year 2000 compliant. In addition, the
Company has reviewed, or is in process of reviewing, equipment that uses
computerized controls or imbedded processors, to help assure that such equipment
will function properly in the Year 2000 and beyond. The Company has not, to
date, identified deficiencies which it believes cannot be corrected or which
will have a material effect, either financially or operationally, on the
Company. The Company believes that the upgrades will allow it to address Year
2000 related issues of these systems on a timely basis; however, successful
implementation is subject to future events, including third party performance of
these agreements. To the extent it believes appropriate, the Company has had
such discussions as believed appropriate with suppliers of this equipment and
has confirmed Year 2000 compliance with key suppliers and customers.

         Given its present understanding of potential Year 2000 problems, the
Company believes that if compliance is not achieved, the largest problem the
Company might experience is a delay in obtaining production and financial
reporting information. Since computer software vendors have not indicated
potential problems and the Company has not experienced Year 2000 with the
software upgrades already implemented, the Company has not yet developed
specific contingency plans, but will do so later in calendar 1999 if
circumstances would require. The Company has tested the upgrades during the
fourth quarter and nothing has come to the Company's attention to indicate the
upgrades will not be compliant. In the event that any automated production
equipment cannot be upgraded to achieve Year 2000 compliance, the internal
clocks on the equipment will be set back to the year 1980. The equipment will
function properly, but utilization reports would have an incorrect date.

         At this time, the Company does not expect that the reasonably
foreseeable consequences of Year 2000 compliance will have material effects on
the Company's business, operations or financial condition. However, Year 2000
compliance has many elements and potential consequences, some of which may not
be foreseeable. Therefore, there can be no assurance that unforeseen
circumstances will not arise, or that the Company will not in the future
identify equipment or systems which are not Year 2000 compliant.


RECENTLY ISSUED FINANCIAL ACCOUNTING PRONOUNCEMENTS

         During 1998, the Financial Accounting Standards Board (FASB) issued
Statements of Financial Accounting Standards FAS 133 "Accounting for Derivative
Instruments and Hedging Activities." FAS 133 established standards for
accounting for derivatives and hedging activities. The effective application
date of this standard has been deferred by the release of FAS 137 "Accounting
for Derivative Instruments and Hedging Activities - Deferral of the Effective
Date of FASB Statement No. 133." FAS 137 defers application of FAS 133 to the
Company's 2001 fiscal year. At this time, the Company does not have any
derivatives or hedging activities that would be affected by FAS 133.

<PAGE>   17
                                                                              16

ITEM 7A.      QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

         The following discussion about the Company's risk management activities
may include forward-looking statements that involve risk and uncertainties.
Actual results could differ materially from those discussed.

         The Company has financial instruments, including notes receivable and
long-term debt, which are sensitive to changes in interest rates. However, the
Company does not use any interest-rate swaps or other types of derivative
financial instruments to limit its sensitivity to changes in interest rates
because of the relatively short-term nature of its notes receivable and
variability of interest rates on certain of its long-term debt.

         The Company does not believe there has been any material changes in the
reported market risks faced by the Company since the end of its last fiscal
year, May 31, 1998.

ITEM 8.       FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

         The financial statements (including the notes thereto and the
accountants' report thereon) required by this item are set forth on pages F-1
and following of this Report, and are incorporated herein by reference. See also
"Index to Financial Statements and Financial Statement Schedules" following Item
14 herein. Supplementary data is not required to be presented, as the Company
does not meet the criteria for mandatory filing.

ITEM 9.       CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
              AND FINANCIAL DISCLOSURE.

         Not applicable.



OTHER

         In general, the Company believes that the effects of inflation on the
Company have not been material in recent years.





<PAGE>   18
                                                                              17


         PART III

ITEM 10.      DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

         Information in response to this item is incorporated herein by
reference to "Election of Directors" and to "Section 16(a) Beneficial Ownership
Reporting Compliance" in the Company's Proxy Statement to be filed pursuant to
Regulation 14A for its Annual Meeting of Shareholders to be held on or about
October 21, 1999 ("1999 Annual Meeting Proxy Statement") and "Executive Officers
of the Registrant" in Part I hereof.

ITEM 11.      EXECUTIVE COMPENSATION.

         Incorporated by reference to "Election of Directors -- Directors' Fees"
and "Executive Compensation" in the 1999 Annual Meeting Proxy Statement.

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

         Information in response to this item is incorporated herein by
reference to "Security Ownership of Certain Beneficial Owners and Management" in
the 1999 Annual Meeting Proxy Statement.

ITEM 13.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         Information in response to this item is incorporated by reference to
"Certain Transactions" in the 1999 Annual Meeting Proxy Statement.


                                     PART IV

ITEM 14.      EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

     (a)      DOCUMENTS FILED:

              1 and 2. Financial Statements and Financial Statement
                       Schedules. See the following "Index to Financial
                       Statements and Financial Statement Schedules," which
                       is incorporated herein by reference.

              3.       Exhibits.  See Exhibit Index included as last part of
                       this report, which is incorporated herein by reference.

      (b)      REPORTS ON FORM 8-K:

               None filed during the fourth quarter of fiscal 1999.




<PAGE>   19
                                                                              18

         INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

         The following consolidated financial statements of the Company and
subsidiaries are included in this Form 10-K Annual Report:

<TABLE>
<CAPTION>

                                                                                                  PAGE NUMBER

<S>                                                                                               <C>
         Report of Independent Certified Public Accountants.............................              19

         Consolidated Balance Sheets as of May 31, 1999 and 1998........................              20

         Consolidated Statements of Operations for the years ended May 31, 1999, 1998
                  and 1997 .............................................................              21

         Consolidated Statements of Shareholders' Equity for the years ended
                  May 31, 1999, 1998 and 1997...........................................              22

         Consolidated Statements of Cash Flows for the years ended May 31, 1999,
                  1998 and 1997.........................................................              23

         Notes to Consolidated Financial Statements.....................................              24
</TABLE>


         The following financial statement schedule of the Company, and the
accountants' report thereon, appear on the indicated pages in this Form 10-K
Annual Report:

<TABLE>
<CAPTION>

                                                                                              PAGE NUMBER IN 10-K
                                                                                              -------------------
<S>                                                                                           <C>
         Report of Independent Certified Public Accountants on
                  Financial Statement Schedule..........................................             35

         Schedule II -- Valuation and Qualifying Accounts...............................             36
</TABLE>



<PAGE>   20
[PRICEWATERHOUSECOOPERS LETTERHEAD]                                           19

                       REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Shareholders
 Outlook Group Corp. and Subsidiaries
Neenah, Wisconsin


In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, shareholders' equity and cash flows
present fairly, in all material respects, the financial position of Outlook
Group Corp. and subsidiaries at May 31, 1999 and 1998, and the results of their
operations and their cash flows for each of the three years in the period ended
May 31, 1999, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for the
opinion expressed above.

/s/ PRICEWATERHOUSECOOPERS LLP

Milwaukee, Wisconsin
June 30, 1999, except for the information
 presented in footnote G for which the date
 is August 3, 1999
<PAGE>   21
                                                                              20

<TABLE>
<CAPTION>
                                              OUTLOOK GROUP CORP.
                                          Consolidated Balance Sheets
                                                                                          May 31,
                                                                           -------------------------------------
                                ASSETS                                           1999                 1998
                                                                                 ----                 ----
======================================================================
                                                                           ( in thousands except share and
                                                                                 per share amounts)
<S>                                                                            <C>                  <C>
 Current Assets
    Cash and cash equivalents                                                  $ 1,940              $ 2,825
     Accounts receivable, less allowance for                                    10,713               11,427
        doubtful accounts of $771, and $1,575, respectively
    Notes receivable-current portion                                             2,805                1,726
    Inventories                                                                  4,899                5,707
    Deferred income taxes                                                          203                  406
    Income taxes refundable                                                        876                  901
    Other                                                                          738                  433
                                                                               -------              -------
        Total current assets                                                    22,174               23,425
  Notes receivable-long term, less allowance for
      doubtful accounts of $477 in both years                                    1,633                3,042
  Property, plant, and equipment
      Land                                                                         589                  589
      Building and improvements                                                 11,290               11,132
      Machinery and equipment                                                   40,973               36,739
                                                                               -------              -------
                                                                                52,852               48,460
    Less: accumulated depreciation                                             (26,488)             (23,293)
                                                                               -------              -------
                                                                                26,364               25,167
  Other assets                                                                   1,596                1,823
                                                                               -------              -------
        Total assets                                                           $51,767              $53,457
                                                                               =======              =======
                 LIABILITIES AND SHAREHOLDERS' EQUITY
======================================================================
 Current Liabilities
    Current maturities of long-term debt                                       $ 2,308              $ 1,658
    Accounts payable                                                             3,222                4,703
    Book overdraft                                                                 337                    -
    Accrued liabilities:
         Salaries and wages                                                      1,509                1,472
         Other                                                                     790                1,407
                                                                               -------              -------
            Total current liabilities                                            8,166                9,240
  Long-term debt, less current maturities                                        4,753                7,061
  Deferred income taxes                                                          4,170                3,773
  Shareholders' equity
    Cumulative preferred stock, $.01 par value - authorized
      1,000,000 shares; none issued                                                  -                    -
    Common stock, $.01 par value - authorized 15,000,000 shares;
      5,117,132 shares issued and outstanding in both years                         51                   51
    Additional paid-in capital                                                  18,494               18,494
    Retained earnings                                                           20,682               19,287
    Officer loans                                                                 (100)                   -
                                                                               -------              -------
                                                                                39,127               37,832
    Less 450,000 shares of treasury stock at cost, both years                   (4,449)              (4,449)

                                                                               -------              -------
      Total shareholders' equity                                                34,678               33,383
                                                                               -------              -------
      Total liabilities and shareholders' equity                               $51,767              $53,457
                                                                               =======              =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

<PAGE>   22
                                                                              21

                              OUTLOOK GROUP CORP.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                                     YEARS ENDED MAY 31,
                                                          -----------------------------------------------
                                                                1999             1998             1997
                                                           (IN THOUSANDS EXCEPT SHARE AND PER SHARE
                                                                           AMOUNTS)
<S>                                                        <C>              <C>               <C>
Net sales                                                  $   67,086       $   66,951        $   72,054
Cost of goods sold                                             54,242           54,545            61,168
                                                           ----------       ----------        ----------
    Gross profit                                               12,844           12,406            10,886
 Selling, general, and
 administrative expenses                                       10,554           10,454             9,904
                                                           ----------       ----------        ----------
   Operating profit                                             2,290            1,952               982
Other income (expense):
Interest expense                                                 (627)          (1,968)           (2,778)
Gain on sale of subsidiary                                          -                -               556
Interest and other income                                         609            1,409               746
                                                           ----------       ----------        ----------
Earnings (loss) from
   continuing operations before
   income taxes                                                 2,272            1,393              (494)
Income tax expense                                                877              640                58
                                                           ----------       ----------        ----------
     Earnings (loss) from continuing operations                 1,395              753              (552)
Discontinued Operations:
 Loss from
    discontinued operations before
    income taxes                                                    -              (57)           (1,492)
 Loss on sale of
    discontinued operations before
    income taxes                                                    -             (859)                -
 Income tax expense (benefit)                                       -                4              (574)
                                                           ----------       ----------        ----------
 Loss from
   discontinued operations                                         -              (920)             (918)
                                                           ----------       ----------        ----------
     Net earnings (loss)                                   $    1,395       $     (167)       $   (1,470)
                                                           ==========       ==========        ==========
 Net earnings (loss) per share - Basic:
     Continuing                                            $     0.30       $     0.16        $    (0.12)
     Discontinued                                                   -            (0.20)            (0.20)
                                                           ----------       ----------        ----------
         Total                                             $     0.30       $    (0.04)       $    (0.32)
                                                           ==========       ==========        ==========
Net earnings (loss) per share - Diluted:
     Continuing                                            $     0.30       $     0.16        $    (0.12)
     Discontinued                                                   -            (0.20)            (0.20)
                                                           ----------       ----------        ----------
         Total                                             $     0.30       $    (0.04)       $    (0.32)
                                                           ==========       ==========        ==========
 Weighted average number of shares outstanding
     Basic                                                  4,667,132        4,662,460         4,649,382
                                                           ==========       ==========        ==========
     Diluted                                                4,667,542        4,692,522         4,700,551
                                                           ==========       ==========        ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.

<PAGE>   23
                                                                              22

                              OUTLOOK GROUP CORP.
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                                        YEARS ENDED MAY 31
                                  ------------------------------------------------------------------------------------------------

                                           COMMON STOCK       ADDITIONAL                            TREASURY STOCK
                                       ----------------------  PAID-IN    RETAINED  OFFICER     -----------------------
                                         SHARES      AMOUNT    CAPITAL    EARNINGS   LOAN       SHARES       AMOUNT        TOTAL
                                       ---------------------------------------------------------------------------------------------
                                                         (IN THOUSANDS EXCEPT SHARE AMOUNTED)
<S>                                     <C>        <C>       <C>           <C>       <C>       <C>        <C>            <C>
Balance at June 1, 1996                 5,099,382    $   51   $  18,415   $  20,924  $    -      450,000    $  (4,449)    $  34,941
   Net loss for 1997                           -        -           -        (1,470)      -         -             -          (1,470)
                                        ---------    -------  ---------   ---------  --------    -------    ---------     ---------
Balance at May 31, 1997                 5,099,382        51      18,415      19,454       -      450,000       (4,449)       33,471
  Exercise of employee stock options       17,750       -            79         -         -          -            -              79
  Net loss for 1998                           -         -           -          (167)      -          -            -           1,395
                                        ---------    -------  ---------   ---------  --------    -------    ---------     ---------
Balance at May 31, 1998                 5,117,132        51      18,494      19,287       -      450,000       (4,449)       33,383
  Net earnings for 1999                       -         -           -         1,395       -          -            -           1,395
  Officer loan                                -         -           -           -        (100)       -            -            (100)
                                        ---------    -------  ---------   ---------  --------    -------    ---------     ---------
Balance at May 31, 1999                 5,117,132    $   51   $  18,494   $  20,682  $   (100)   450,000    $  (4,449)    $  34,678
                                        =========    =======  =========   =========  ========    =======    =========     =========
</TABLE>
The accompanying notes are an integral part of these financial statements.






<PAGE>   24
                                                                              23
                               OUTLOOK GROUP CORP.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>


                                                                                         Years Ended May 31,
                                                                       --------------------------------------------------------
                                                                         1999                   1998                   1997
                                                                         ----                   ----                   ----
                                                                                           (in thousands)
<S>                                                                    <C>                    <C>                     <C>
Cash flows from operating activities:
Net earnings (loss)                                                    $  1,395               $   (167)               $ (1,470)
      Adjustments to reconcile net earnings (loss) to
      net cash provided by operating activities:
      Depreciation and amortization                                       3,910                  4,850                   5,952
      Provision for doubtful accounts                                      (804)                   929                     639
      (Gain) loss on sale of assets                                          93                 (1,339)                   (407)
      (Gain) loss on sale of subsidiaries                                     -                    859                    (556)
      Gain on sale of facility                                                -                   (583)                      -
      Deferred income taxes                                                 600                    754                     321
 Change in assets and liabilities, net of effects of acquisitions
      and disposals of businesses:
      Accounts and notes receivable                                       2,146                   (764)                    991
      Inventories                                                           922                  1,227                   1,048
      Income taxes refundable                                                25                   (176)                  1,239
      Accounts payable                                                   (1,481)                 2,010                     575
      Accrued liabilities                                                  (580)                 1,296                    (420)
      Other                                                                 162                    261                    (966)
                                                                       --------               --------                --------
         Net cash provided by operating activities                        6,388                  9,157                   6,946
                                                                       --------               --------                --------
Cash flows from investing activities:
     Acquisition of property, plant and equipment                        (3,397)                (1,157)                 (4,275)
     Proceeds from sale of assets                                            37                  2,348                   2,604
     Purchase of businesses                                              (2,492)                (1,155)                      -
     Proceeds from sale of subsidiaries                                       -                  5,618                   2,888
     Proceeds from sale of facility                                           -                  3,650                       -
     Loan to officer                                                       (100)                     -                       -
                                                                       --------               --------                --------
        Net cash provided by (used in) investing activities              (5,952)                 9,304                   1,217
                                                                       --------               --------                --------
Cash flows from financing activities:
     Increase (decrease) in revolving credit borrowings                       -                 (3,416)                 (7,084)
     Increase (decrease) in book overdraft                                  337                 (1,605)                  1,605
     Proceeds from long-term borrowings                                       -                      -                   4,870
     Payments on long-term borrowings                                    (1,658)               (10,694)                 (7,347)
     Exercise of stock options                                                -                     79                       -
     Debt financing costs                                                     -                      -                    (505)
                                                                       --------               --------                --------
        Net cash used in financing activities                            (1,321)               (15,636)                 (8,461)
                                                                       --------               --------                --------
Net increase (decrease) in cash                                            (885)                 2,825                    (298)
Cash and cash equivalents at beginning of year                            2,825                      -                     298
                                                                       --------               --------                --------
Cash and cash equivalents at end of year                               $  1,940               $  2,825                $      -
                                                                       ========               ========                ========
</TABLE>
The accompanying notes are an integral part of the financial statements.

<PAGE>   25
                                                                              24

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A  SUMMARY OF ACCOUNTING POLICIES

     The following is a summary of Outlook Group Corp. and its wholly owned
subsidiaries ("Company") significant accounting policies consistently applied in
the preparation of the accompanying consolidated financial statements follows:

Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods. Actual results could differ from those estimates.

Principles of Consolidation

     The consolidated financial statements include all the accounts of Outlook
Group Corp. and its wholly owned subsidiaries: Outlook Label Systems, Inc.
("Outlook Label"); Outlook Foods, Inc. ("Outlook Foods") - see Note L; and
Outlook Packaging, Inc. ("Packaging").

     All intercompany accounts and transactions have been eliminated in the
preparation of the consolidated financial statements.

Revenue Recognition

     Revenue is recognized primarily when services have been completed and the
product has been shipped.

Cash and Cash Equivalents

     For purposes of reporting cash flows, cash and cash equivalents include
cash on hand, demand deposits, and short-term investments with maturities of
three months or less at time of purchase.

Accounts and Notes Receivable

     As of May 31, 1999 and 1998, 31% and 20%, respectively, of the accounts
receivable balance relates to three customers.

    Notes receivable at May 31, 1999 and 1998 were $4,438,000 and $4,768,000
respectively. The amounts recorded are net of reserves for potential
uncollectibility of $477,000 in both years. The carrying value of these notes
approximates fair value as they are interest bearing at rates which approximate
market.

Inventories

     Inventories are stated at the lower of cost or market. Cost is determined
using the first-in, first-out method.





<PAGE>   26
                                                                              25


Property, Plant and Equipment

     Property, plant and equipment is recorded at cost. Depreciation is recorded
using the straight-line method over the estimated useful lives of the assets as
follows:

         Buildings and improvements                           10-40 years
         Machinery and equipment                               5-10 years

     Depreciation expense was $3,825,000, $4,784,000, and $5,598,000 for the
years ended May 31, 1999, 1998 and 1997 respectively. Significant additions or
improvements extending the useful lives of assets are capitalized. Repairs and
maintenance are charged to earnings as incurred. Upon retirement or disposal of
assets, the applicable costs and accumulated depreciation are eliminated from
the accounts and the resulting gain or loss is included in income.

     The Company adopted Statement of Financial Accounting Standards No. 121
("FAS 121"), "Accounting for the Impairment of Long-Lived Assets and Long-Lived
Assets to be Disposed of" during fiscal 1998. Applying the criteria established
by FAS 121, the Company determined that certain assets were impaired and
recorded a reserve of $150,000 and $100,000 in 1999 and 1998 respectively.

Intangible Assets

     Intangible assets are included within Other assets and include goodwill,
which represents costs in excess of net assets of businesses acquired, loan
costs, and capital lease placement fees. These intangibles are being amortized
over periods ranging from 4 years to 25 years, using the straight-line method.
The Company continually reviews goodwill and other intangibles to assess
recoverability from estimated future results of operations and cash flows at the
aggregate business unit level.

Stock Based Compensation

     Statement of Financial Accounting Standards No. 123 ("FAS 123").
"Accounting for Stock-Based Compensation," encourages, but does not require
companies to record compensation cost for stock-based employee compensation
plans at fair value. The Company has chosen to continue to account for
stock-based compensation using the intrinsic value method prescribed in
Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees," and related Interpretations. Accordingly, compensation cost is
measured as the excess, if any of the quoted market price of the Company's stock
at the date of grant over the exercise price.

Income Taxes

    Deferred tax assets, net of any applicable valuation allowance, and deferred
tax liabilities are established for the future tax effects of temporary
differences between the bases of assets and liabilities for financial and income
tax reporting purposes, as measured by applying current tax laws.

Earnings Per Share

     The Company adopted Statement of Financial Accounting Standards No. 128
("FAS 128"), "Earnings Per Share", in 1998. FAS 128 established new standards
for computing and presenting earnings per share. The earnings per share
computations for prior periods have been restated to conform with the provisions
of FAS 128.

     Basic earnings per share is computed by dividing net earnings by the
weighted average shares outstanding during each period. Diluted earnings per
share is computed similar to basic earnings per share except that the weighted
average shares outstanding is increased to include the number of additional
shares that would have been outstanding if stock options were exercised and the
proceeds from such exercise were used to acquire shares of common stock at the
average market price during the period.

<PAGE>   27
                                                                              26

     The following is a reconciliation of the average shares outstanding used to
compute basic and diluted earnings per share. There is no earnings per share
impact for the assumed conversions of the stock options in each of the years.

<TABLE>
<CAPTION>

                                                              1999              1998             1997
                                                              ---------         ---------        ---------
<S>                                                           <C>               <C>              <C>
Basic EPS                                                     4,667,132         4,662,460        4,649,382
Effect of Dilutive Securities -
   Stock Options                                                    410            30,062           51,169
                                                              ---------         ---------        ---------
Diluted EPS                                                   4,667,542         4,692,522        4,700,551
</TABLE>

Reclassifications

     Certain reclassifications have been made in the prior years' financial
statements to conform to the current year's presentation.

Recently Issued Accounting Standards

     During 1998, the Financial Accounting Standards Board (FASB) issued
Statements of Financial Accounting Standards FAS 133 "Accounting for Derivative
Instruments and Hedging Activities." FAS 133 established standards for
accounting for derivatives and hedging activities. The effective application
date of this standard has been deferred by the release of FAS 137 "Accounting
for Derivative Instruments and Hedging Activities - Deferral of the Effective
Date of FASB Statement No. 133." FAS 137 defers application of FAS 133 to the
Company's 2001 fiscal year. At this time, the Company does not have any
derivatives or hedging activities that would be affected by FAS 133.




Note B - Inventories

     Inventories consist of the following at May 31:

<TABLE>
<CAPTION>
                                                       1999               1998
                                                       -----------------------
                                                             (in thousands)
<S>                                                    <C>              <C>
Raw materials                                          $2,305           $2,202
Work-in-process                                         1,107            1,160
Finished goods                                          1,487            2,345
                                                        -----           ------
     Total                                             $4,899           $5,707
                                                        =====            =====
</TABLE>





<PAGE>   28
                                                                              27

Note C - Long-Term Debt

      Long-term debt consists of the following at May 31:
<TABLE>
<CAPTION>
                                                                      1999           1998
                                                                  ------------   ------------
                                                                        (in thousands)
<S>                                                              <C>            <C>
Terms note payable due in quarterly principal installments
ranging from September 16, 1999 through September 16, 2000,
plus interest at a weighted average interest rate (8.25% at
May 31, 1999)                                                     $     2,261    $    3,519


Industrial development bond, due in annual principal
installments of $400,000 from February 1, 2000 through
August 1, 2004, plus interest at a floating rate determined
by a remarking agent (3.45% at May 31, 1999)                            4,000         4,000


Industrial development bond, due in annual principal
installments of $400,000 through September 1, 2000, plus
interest at a floating rate determined by a remarking
agent (3.60% at May 31, 1999)                                             800         1,200
                                                                  -----------    ----------
                                                                        7,061         8,719
Less current maturities                                                 2,308         1,658
                                                                  -----------    ----------
                                                                  $     4,753    $    7,061
                                                                  ===========    ==========
</TABLE>

      At May 31, 1999, future maturities of long-term as follows:


                                                     (in thousands)
                                                2000  $       2,308
                                                2001          1,553
                                                2002            800
                                                2003            800
                                                2004            800
                                          Thereafter            800
                                                      -------------
                                               Total  $       7,061
                                                      =============


    On May 12,1999 the Company entered into an Amended and Restated Loan and
Security Agreement (the "Agreement") with its bank, which provided revised
credit facilities. Under the Agreement, the lender provides a $15,000,000 credit
facility comprised of a revolving line of credit commitment (the "Revolver") and
Letters of Credit. Borrowings under the revolver bear interest, at the Company's
option, at a bank determined reference rate or an IBOR based rate. At May 31,
1999 the Company had no borrowings under the Revolver and had outstanding
letters of credit in the amount of $4,876,000 in support of outstanding
industrial revenue bonds.

    Substantially all of the Company's assets have been pledged as collateral on
the various debt agreements. The creditors party to the term notes and revolving
credit arrangements have a priority security interest over the remaining
creditors. The term notes, revolving credit agreements, and industrial
development bond obligations are subject to the terms of certain agreements
which contain provisions setting forth, among other things, fixed charges
restrictions, net worth and debt-to-equity requirements, and restrictions on
property and equipment additions, loans, investments, other borrowings, and
acquisitions and redemption's of the Company's stock or the issuance of stock
except for cash. Additionally, the Company may not pay cash dividends without
the prior consent of certain of its lenders. The carrying amounts of the
Company's long-term debt approximates its fair value based on rates currently
available to the Company for long-term borrowings with similar terms and
remaining maturities.





<PAGE>   29
                                                                              28

  Note D - Employee Benefit Plans

       The Company offers a 401(k) savings plan for all employees that meet
  certain eligibility requirements. Employee contributions to the plan are made
  through payroll deductions. In addition, the Company matches 40-50% of the
  first 6% of each employee's contribution. Employer matching contributions
  under the 401(k) plan for the years ended May 31, 1999, 1998, and 1997 were
  $184,000, $259,000, and $238,000, respectively.

       The company is not obligated to provide any post-retirement medical or
  life insurance benefits or any post-employment benefits to its employees.

  Note E - Income Taxes

       The provision (benefit) for income taxes from continuing operations
  consist of the following:

<TABLE>
<CAPTION>
                                                             1999             1998              1997
                                                             ----             ----              ----
                                                                          (in thousands)
<S>                                                          <C>              <C>               <C>
  Current:
     Federal                                                 $138             $201              $(539)
     State                                                    129              138                (31)
                                                             ----             ----              -----
                                                              267              339               (570)
                                                             ----             ----              -----
  Deferred:
     Federal                                                  501              499                371
     State                                                    109             (198)               257
                                                             ----             ----              -----
                                                              610              301                628
                                                             ----             ----              -----
                                                             $877             $640              $  58
                                                             ----             ----              -----
</TABLE>

     The reconciliation of income tax from continuing operations computed at the
  statutory federal income tax rate to the Company's effective income tax rate,
  expressed as a percentage of pre-tax earnings (loss), is as follows:

<TABLE>
<CAPTION>
                                                             1999             1998              1997
                                                             ----             ----              ----
<S>                                                         <C>              <C>                <C>
Statutory federal income tax rate                            34.0%            34.0%             (34.0)%
State income taxes, net                                       6.9              6.6                3.6
Increase (decrease) in valuation allowance                     --            (14.9)              41.9
Provision for estimated additional income tax                  --             20.2                --
Other                                                        (2.3)              --                 .2
                                                             -----            ----              -----
                                                             38.6%            45.9%              11.7%
                                                             -----            ----              =====

</TABLE>
<PAGE>   30
                                                                              29
     The components of the net deferred income tax liability as of May 31, 1999
and 1998 were as follows:

<TABLE>
<CAPTION>

                                                                      1999               1998
                                                                      -----------------------
                                                                           (in thousands)
<S>                                                                    <C>              <C>
Deferred tax assets:
   Employee benefits                                                  $  184           $  247
   Inventory                                                             120              263
   Accounts receivable                                                  (130)             790
   Tax carryforwards                                                     554            1,274
   Other                                                                  39              193
                                                                      ------           ------
                                                                         767            2,767
                                                                      ------           ------

Deferred tax liabilities:
   Property plant and equipment                                        4,600            4,962
   Barrier installment sale                                              132              218
   Other                                                                   3              854
                                                                      ------           ------
                                                                       4,734            6,134
                                                                      ------           ------
Net deferred income tax liability                                     $3,967           $3,367
                                                                      ------           ------
</TABLE>

     As of May 31, 1999 the Company had $70,000 of alternative minimum tax
credit carryforwards which are available to reduce future regular federal income
tax liabilities. The Company has certain loss and tax credit carryforwards for
state income tax purposes which, net of related federal income taxes,
approximate $484,000. Those state carryforwards expire in varying amounts
through 2013.

     During 1998 the Company reversed a $207,000 valuation allowance previously
recorded against certain state carryforwards. The Company reassessed its ability
to recover these amounts in the future.

Note F - Stock Options

     In 1990, the shareholders approved the 1990 Stock Option Plan (the "1990
Plan") which provides for the granting of stocks as an incentive to officers and
certain key salaried employees. The 1990 Plan provides for the issuance of up to
200,000 shares of common stock at an exercise price which may not be less than
the market price of the common stock on the date of the grant. Options granted
prior to 1996 became exercisable six months after the date of grant. Options
granted during 1996 and 1997 became exercisable one year after the date of
grant. Options granted during 1999 became exercisable six months after grant. In
addition, during fiscal 1997, the company granted its non-employee directors
stock options for a total of 18,000 shares apart from the 1990 Plan.

     Transactions under the 1990 Plan, and non-1990 Plan option grants to
non-employee directors, during the years ended May 31, 1999, 1998, and 1997 are
summarized as follows:

<TABLE>
<CAPTION>

                                                           1999                          1998                        1997
                                                 ------------------------      -----------------------      ----------------------
                                                                Weighted                     Weighted                    Weighted
                                                                 Average                      Average                     Average
                                                                Exercise                     Exercise                    Exercise
                                                   Shares        Price           Shares       Price           Shares      Price
                                                 -----------  -----------      ----------  -----------      ----------  ----------

<S>                                                 <C>       <C>                 <C>      <C>                  <C>     <C>
Options outstanding, beginning of year              133,000   $      6.01         150,750  $      5.16          87,500  $     5.02
Granted                                              86,500          3,94            -             -            82,750        5.00
Exercised                                               -             -           (17,750)        4.44            -            -
Expired                                             (58,500)         4.47            -             -           (19,500)       4.45
                                                 ----------   -----------      ----------  -----------      ----------  ----------
Options outstanding, end of year                    161,000   $      4.46         133,000  $      6.01         150,750  $     5.16
                                                 ----------   -----------      ----------  -----------      ----------  ----------
</TABLE>




<PAGE>   31
                                                                              30


       The outstanding stock options at May 31, 1999 have a range of exercise
prices between $3.94 and $5.75 per share, a weighted average contractual life of
approximately 5 years, and a maximum term of 5 years from the date of grant. At
May 31, 1999, 161,000 options are exercisable at a weighted average exercise
price of $4.46. The weighted average fair value at date of grant for options
granted during 1999 and 1997 was $1.22 and $1.48, respectively. The fair value
of options, at date of grant, for options granted in 1999 and 1997, was
estimated using the Black-Scholes option pricing model with the following
assumptions:

<TABLE>
<CAPTION>


                                      1999            1997
<S>                                     <C>             <C>
Expected life (years)                 2               2
Risk-free interest rate               4.73%           6.08%
Expected volatility                   50.0%           62.4%
Expected dividend yield               --              --
</TABLE>

       The Company applies Accounting Principles Board Opinion No. 25, under
which no compensation cost has been recognized in the statement of operations.
Had compensation cost been determined under an alternative method suggested by
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation," the pro forma effect on the 1999, 1998 and 1997 net earnings
(loss) would have been $(95,000), ($29,000), and $(78,000), respectively. The
pro forma effect on the 1999, 1998, and 1997 earnings (loss) per share would
have been $(.02), ($(.02) diluted), $(.01) ($.01) diluted), and $(.02) ($.02)
diluted), respectively.

Note G - Commitments and Contingencies

         The Company has a number of operating lease agreements primarily
involving manufacturing equipment and warehouse space. These leases are
non-cancelable and expire on various dates through 2004.


         The following is a schedule, by fiscal year, of the rental payments due
under non-cancelable operating leases, as of May 31, 1999


          (in thousands)

      2000 $            2,271
      2001              2,326
      2002              2,234
      2003                856
      2004              1,454
Thereafter                -
           ------------------
  Total    $            9,141
           ==================

       Rent expense for the years ended May 31, 1999, 1998 and 1997 was
$2,318,000, $2,517,000, and $2,838,000 respectively.


       The Company has been named as a defendant in an action captioned Barrier
Films Ltd.--New York ["Barrier-NY"] versus Outlook Group, Inc., and Joseph
Baksha, filed in the Supreme Court of the State of New York (Suffolk County),
Index No. 99-08965, on April 29, 1999. The Company removed the case to the U.S.
District Court for the Eastern District of New York, Civil No. 99-CV-3057 (LDW),
on June 1, 1999.

       This suit alleges various causes of action which arise out of the
acquisition of Barrier Films Corporation ("BFC") by Barrier-NY from the Company
in May 1997. Barrier's complaint, as amended, has multiple counts, with
overlapping claims that can be summarized as: (a) various allegations and causes
of action arising from the alleged failure of the Company to comply with closing
obligations relating to consents by former BFC officers under their employment
agreements; (b) alleged tortuous interference with Barrier-NY's customer
relationship with a customer of BFC prior to the transaction; (c) various claims
that the Company failed to comply with its obligations under a related Rebate
and Supply Agreement; (d) allegations that the Company either misappropriated or
disclosed

<PAGE>   32
                                                                              31
certain confidential BFC information, and (e) a request for a judgment
declaring the 1997 promissory note executed by Barrier-NY in the BFC acquisition
unenforceable, null and void. Because the complaint presents overlapping claims,
and requests multiple awards of damages for the same underlying facts,
determining the actual amount at issue is uncertain; however, all of the claims
made total $27.65 million, plus elimination of the note, plus requests for costs
and punitive damages, without any attempt to adjust the claims for multiple
requests resulting from overlapping causes of action.

       In August 1999, the Company answered the claim denying liability and
filed a counterclaim for more than $2.6 million, plus costs and other damages,
as a result of Barrier-NY's failure to make payments due the Company under the
1997 promissory note and under the Purchase and Sale Agreement in connection
with the sale of BFC. At the present time, the litigation is at a very early
stage. No discovery yet has been taken. However, the Company believes that
Barrier-NY's claims are without merit, and intends to defend the matter, and to
pursue its counterclaim, vigorously and aggressively.

       Because of the early stages of this claim and counterclaim, the ultimate
resolution of this matter cannot be determined; as such, the Company has not
recorded any provision for this issue at May 31, 1999. In the event of an
unanticipated adverse final judgement in this claim, the Company's consolidated
financial position and results of operations could be materially affected.

Note H - Operating Segments and Major Customers

       The Company adopted SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information," in 1999 which changes the way the Company
reports information about its operating segments. The information for 1997 and
1998 has been restated from the prior year's presentation in order to conform to
the 1999 presentation.

       The Company has three reportable segments that are strategic business
units that offer different products and services. These business units are:
Outlook Graphics, Outlook Label Systems, and Outlook Packaging. Outlook Graphics
produces custom printed products on a wide range of media including newsprint,
coated paper, and heavy board, including paperboard packaging. Outlook Graphics
also provides finishing services, promotional contract packaging, direct
mailing, and distribution services. Outlook Label Systems manufactures items
such as coupons, pressure sensitive specialty labels, printed vinyl cards,
continuous forms, cartons, and sweepstakes and specialty game pieces.
Flexographic printing and laminating of flexible packaging films is handled by
the Outlook Packaging business unit.

       The accounting policies of the reportable segments are the same as those
described in Note A, Summary of Accounting Policies. The Company evaluates the
performance of its reportable segments based on the income from operations of
the respective business units.

       Summarized financial information for the years ended May 31, 1999, 1998
and 1997 are as follows:


<PAGE>   33
                                                                              32
<TABLE>
<CAPTION>
                                                     Label
                                     Graphics        Systems       Packaging     All other       Total
                                  ----------------------------  --------------------------- --------------

Continuing Operations
<S>                               <C>              <C>           <C>            <C>            <C>
1999

Net sales                              $ 37,519      $ 14,578       $ 15,546        $ (557)      $ 67,086
Depreciation and amortization             1,961           917          1,003            29          3,910
Interest income                             439             -              5             -            444
Interest expense                            309            73            228            17            627
Income tax expense (benefit)              1,030           505           (643)          (15)           877
Net earnings (loss)                       1,698           890         (1,140)          (53)         1,395

Total assets                           $ 31,154       $ 7,516       $ 13,097           $ -       $ 51,767
                                  ============== =============  ============= ============= ==============

1998

Net sales                              $ 31,923      $ 15,624       $ 20,242        $ (838)      $ 66,951
Depreciation and amortization             2,214         1,017          1,020            29          4,280
Interest income                             389             -             26             -            415
Interest expense                            581           345          1,042             -          1,968
Income tax expense (benefit)                (44)          331            326            27            640
Net earnings (loss)                      (1,134)        1,681           (597)          803            753

Total assets                           $ 31,404       $ 8,221       $ 13,832           $ -       $ 53,457
                                  ============== =============  ============= ============= ==============

1997

Net sales                              $ 32,943      $ 13,653       $ 20,445       $ 5,013       $ 72,054
Depreciation and amortization             2,542         1,109          1,017           337          5,005
Interest income                             218             -              -             -            218
Interest expense                            739           422          1,280           337          2,778
Income tax expense (benefit)                  2           104            (48)            -             58
Net earnings (loss)                         848           628         (1,314)         (714)          (552)

Total assets                           $ 34,960       $ 8,345       $ 16,085       $ 7,870       $ 67,260
                                  ============== =============  ============= ============= ==============

</TABLE>
<PAGE>   34
                                                                              33

       During the years ended May 31, 1999, 1998, and 1997, the Company had
sales to certain customers that accounted for more than 10% of the Company's net
sales from continuing operations, as follows:


                                  1999        1998        1997
                          -------------------------------------

Kraft Foods, Inc.                   6%         10%         14%
America Online, Inc.               13%          1%          0%
Kimberly Clark                     12%          9%          7%



Note I - Supplemental Cash Flow Information

       In 1998 the Company sold its wholly owned subsidiary, Outlook Foods, and
accepted a $1,500,000 note in partial consideration for the sale.


       Cash paid during the year:



                         1999        1998        1997
                      ------------------------------------
                                (in thousands)
Interest                    $ 691     $ 1,805     $ 2,571
Income taxes                $ 242     $   505     $    76



Note J - Acquisitions and Dispositions

       In November 1997, the Company acquired selected operations of General
Converting, another flexible packaging company. In February 1999, the Company
acquired, from the same company that had owned the assets of General Converting,
specified additional business of Plicon Corporation. The purchase price paid for
these assets is subject to a post closing adjustment based on the results of
revenues generated from these assets for up to a period ended February 11, 2000.
The Company has not recorded a liability at May 31, 1999 relating to this
adjustment. In October 1998, the Company acquired selected assets of Precision
Paper Converters, Inc.; the acquired assets and operation have been integrated
into Outlook Graphics. In March 1999, the Company acquired certain assets of
Kostner Graphics which the Company has integrated into its Outlook Graphics
operations. The excess of the cost over the estimated fair values of the assets
acquired during the year ended May 31, 1999 are being amortized over a 10 year
life. The total purchase in fiscal 1999 and 1998 were $2.5 million and $1.2
million respective. Goodwill recorded for the fiscal year 1999 and 1998 were
$325,000 and $635,000 respectively.


Note K - Fourth Quarter Results

          Fourth quarter write-offs related to receivables and inventories
decreased the fiscal 1999 fourth quarter earnings before income tax by
approximately $335,000.


Note L - Discontinued Operations

       During the second quarter of fiscal 1997, the Company adopted a formal
plan to dispose of Outlook Foods, located in Oconomowoc, Wisconsin. Outlook
Foods is a food processing operations, involved primarily in dry-blended food
processing and packaging. On May 1, 1998, Foods was sold to lake Country Foods.
Lake Country



<PAGE>   35
                                                                              34
Foods incurred an operating loss of $60,000 through the date of disposal. Net
sales generated from Outlook Foods were $15,460,000, and $16,804,000 for the
years ended May 31, 1998 and 1997, respectively. Sales to Nestle Beverage
Company accounted for 48%, and 67% of Outlook Foods' net sales for the years
ended May 31, 1998 and 1997, respectively.












        Statement of Management Responsibility for Financial Statements

     The consolidated financial statements and accompanying information were
prepared by and are the responsibility of management. The statements were
prepared in conformity with generally accepted accounting principles and, as
such, include amounts that are based on management's best estimates and
judgments.

     The internal control systems are designed to provide reliable financial
information for the preparation of financial statements, to safeguard assets
against loss or unauthorized use and to ensure that transactions are executed
consistent with company policies and procedures. Management believes that
existing internal accounting control systems are achieving their objectives and
that they provide reasonable assurance concerning the accuracy of the financial
statements.

     Oversight of management's financial reporting and internal accounting
control responsibilities is exercised by the Board of Directors, through an
Audit Committee which consists solely of outside directors. The committee meets
periodically with financial management to ensure that it is meeting it
responsibilities and to discuss matters concerning auditing, internal accounting
control and financial reporting. The independent accountants have free access to
meet with the Audit Committee without management's presence.

<PAGE>   36
                                                                           35


[PRICEWATERHOUSECOOPERS LETTERHEAD]


       REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULES


To the Board of Directors and Shareholders
  Outlook Group Corp. and Subsidiaries
Neenah, Wisconsin

Our audits of the consolidated financial statements referred to in our report
dated June 30, 1999, except for the information presented in footnote G for
which the date is August 3, 1999 (which report and consolidated financial
statements are included in this Form 10-K) also included an audit of the
financial statement schedule listed in Item 14(a)(2) of this Form 10-K. In our
opinion, this financial statement schedule presents fairly, in all material
respects, the information set forth therein when read in conjunction with the
related consolidated financial statements.

/s/ PricewaterhouseCoopers LLP

Milwaukee, Wisconsin
June 30, 1999
<PAGE>   37
                                                                              36
                      OUTLOOK GROUP CORP. AND SUBSIDIARIES

                SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                             (Dollars in thousands)


<TABLE>
<CAPTION>
                                                       ADDITIONS
                                         BALANCE       CHARGED TO
                                        BEGINNING      COSTS AND                       BALANCE
                                         OF YEAR        EXPENSES      DEDUCTIONS     END OF YEAR
                                       ----------------------------------------------------------

<S>                                    <C>             <C>            <C>            <C>
Year Ended May 31, 1999
Allowance for doubtful accounts              1,575           276            1,080    $      771

Year Ended May 31, 1998
Allowance for doubtful accounts              1,124         1,009              558         1,575

Year Ended May 31, 1997
Allowance for doubtful accounts                896           639              411         1,124
</TABLE>
<PAGE>   38
                                                                              37

                                   SIGNATURES

         PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.


OUTLOOK GROUP CORP.


By /s/ Richard C. Fischer                                   August 30, 1999
   -------------------------------------------------
      Richard C. Fischer, Chairman


                                POWER OF ATTORNEY

         KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Richard C. Fischer, Joseph J. Baksha and
Paul M. Drewek, and each of them, his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
to this report, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents or any of them, or their substitutes, may
lawfully do or cause to be done by virtue hereof.


PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS REPORT
HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE REGISTRANT AND
IN THE CAPACITIES INDICATED, AS OF AUGUST 30, 1999.


     SIGNATURE AND TITLE                       SIGNATURE AND TITLE
     -------------------                       -------------------


        /s/ Richard C. Fischer                 /s/ Jeffry H. Collier
----------------------------------       ---------------------------------------
  Richard C. Fischer, Chairman, Chief                Jeffry H. Collier, Director
 Executive Officer and Director
      (principal executive officer)

         /s/ Paul M. Drewek                     /s/ James L. Dillon
--------------------------------------------------------------------------------
           Paul M. Drewek                            James L. Dillon, Director
    Chief Financial Officer
 (principal financial and accounting officer)

         /s/ Joseph J. Baksha                         /s/ Pat Richter
--------------------------------------------------------------------------------
   Joseph J. Baksha, President and Chief Operating         Pat Richter, Director
                Officer; Director


         /s/ Harold J. Bergman                 /s/ A. John Wiley, Jr.
--------------------------------------------------------------------------------
     Harold J. Bergman, Director                    A. John Wiley, Jr., Director




<PAGE>   39
                                                                              38


                               OUTLOOK GROUP CORP.
                                 (THE "COMPANY")

                                  EXHIBIT INDEX
                                       TO
                   ANNUAL REPORT ON FORM 10-K FOR FISCAL 1999


<TABLE>
<CAPTION>
                                                                       INCORPORATED HEREIN                FILED
EXHIBIT NO.                       EXHIBIT                                BY REFERENCE TO                 HEREWITH
-----------                       -------                                ---------------                 --------

<S>                <C>                                                 <C>                               <C>
3(i)               Restated Articles of Incorporation of the           Exhibit 3(i) to the
                   Company (effective August 3, 1990), as amended      Company's Annual Report
                   through November 1, 1994                            on Form 10-K for the fiscal
                                                                       year ended May 31, 1995
                                                                       ("1995 10-K")

3(ii)              Restated Bylaws of the Company (as adopted on       Exhibit 3(ii) to the
                   August 19, 1998)                                    Company's Annual Report on
                                                                       Form 10-K for the fiscal
                                                                       year ended May 31, 1998
                                                                       ("1998 10-K")

4.1                Articles III, IV and VI of the Restated Articles    Contained in Exhibit 3.1
                   of Incorporation of the Company                     hereto

4.2(a)             Amended and Restated Note Purchase Agreement        Exhibit 4.1 to the Company's
                   dated November 5, 1996 between the Company and      Quarterly Report on Form
                   State of Wisconsin Investment Board*                10-Q for the quarter ended
                                                                       November 29, 1996 ("11/96
                                                                       10-Q")

4.2(b)             Waiver and Amendment thereto dated August 21,       Exhibit 4.2 (b) to the
                   1997                                                Company's Annual Report
                                                                       on Form 10-K for the fiscal
                                                                       year ended May 31, 1997
                                                                       ("1997 10-K")

4.3(a)             Loan and Security Agreement dated November 5,       Exhibit 4.2 to 11/96 10-Q
                   1996 among the Company and its subsidiaries
                   and Bank America Business Credit, Inc.*
                   (superseded)


4.3(b)             Amended and Restated Loan and Security                                                 X
                   Agreement dated May 12, 1999 among the Company
                   and its subsidiaries and Bank of
                   America National Trust and Savings Association*

4.4(a)             Reimbursement Agreement dated August 1, 1994        Exhibit 4.4(a) to the
                   between Outlook Packaging, Inc. ("Packaging")       Company's Annual Report on
                   and Firstar Bank, relating to $4,000,000 City of    Form 10-K for the fiscal


</TABLE>
<PAGE>   40
                                                                              39
<TABLE>
<CAPTION>
                                                                       INCORPORATED                 FILED
EXHIBIT                       EXHIBIT                                     HEREIN                    HERE
-------                       -------                                 BY REFERENCE TO               WITH
 NO.                                                                  ---------------               ----
----
<S>                <C>                                                <C>                           <C>
                   Oak Creek Industrial Revenue Bonds*                year ended May 31, 1994
                                                                      ("1994 10-K")

4.4(b)             Related Corporate Guarantee Agreement dated        Exhibit 4.4(b) to the 1994
                   August 1, 1994 by the Company*                     10-K

4.5                Loan Agreement dated as of September 1, 1990 by    Exhibit 4.6 to the Company's
                   and between City of Neenah, Wisconsin and Olympic  Registration Statement on
                   Label Systems, Inc. (n/k/a Outlook Label Systems,  Form S-1 (No. 33-36641), as
                   Inc.) ("Outlook Label"), relating to $4,000,000    amended by Amendment No. 1
                   Industrial Development Revenue Bonds               thereto ("S-1")

10.1               1990 Stock Option Plan**                           Exhibit 10.1 to S-1

10.2(a)            Employment Agreement dated as of June 1, 1997      Exhibit 10.10 to 1997 10-K
                   between the Company and Joseph J. Baksha**

10.2(b)            Term Note dated July 22, 1998 of Mr. Baksha to     Exhibit 10.3(b) to 1998 10-K
                   the Company, as contemplated by the Employment
                   Agreement**

10.3(a)            Lease Agreement dated November 7, 1990 between     Exhibit 10.10(b) to S-1
                   the Company and a joint venture relating to the
                   lease of City of Neenah property*

10.3(b)            Lease Amendment #1 thereto dated March 31, 1992    Exhibit 10.7(b)(ii) to the
                                                                      Company's Annual Report on
                                                                      Form 10-K for the fiscal
                                                                      year ended May 31, 1992
                                                                      ("1992 10-K")

10.4               401(k) Savings Plan (as amended and restated       Exhibit 10.11 to S-1
                   effective as of January 1, 1989) including the
                   Defined Contribution Regional Prototype Plan and
                   Trust Document and the Adoption Agreement
                   thereto**

10.5               Master Lease Agreement dated March 13, 1997        Exhibit 10.6 to 1997 10-K
                   between the Company and General Electric
                   Corporation*



10.6               Letter of Credit Agreements No. One and No. Two    Exhibit 10.7 to 1997 10-K
                   dated March 13, 1997 between Outlook Group Corp.
                   and General Electric Corporation

10.7               Form of the Company's Non-Qualified Stock Option   Exhibit 10.15 to Amendment
                   Agreement (for non-employee directors)             No. 1 to 1997 10-K

10.8               Purchase and Sale Agreement dated as of April      Exhibit 2.1 to the



</TABLE>
<PAGE>   41
                                                                              40
<TABLE>
<CAPTION>
                                                                       INCORPORATED                 FILED
EXHIBIT                       EXHIBIT                                     HEREIN                    HERE
-------                       -------                                 BY REFERENCE TO               WITH
 NO.                                                                  ---------------               ----
----
<S>                <C>                                                <C>                           <C>


                   30, 1998 among Outlook Foods, Inc., the            Company's Current Report
                   Company, Lake Country Foods, Inc. and Lake         on Form 8-K dated May 5,
                   Country Properties, LLC*                           1998

21.1               List of subsidiaries of the Company                                                     X

23.1               Consent of PricewaterhouseCoopers LLP                                                   X

24.1               Powers of Attorney                                                                Signature Page
                                                                                                     to this Report


27                 Financial Data Schedule                                                                 X
------------------
</TABLE>

*        Excluding exhibits and/or schedules which are identified in the
         document. The Company agrees to furnish supplementary a copy of any
         omitted exhibit or schedule to the Commission upon request.
**       Designates compensatory plans and agreements for executive officers.