##### Table of Contents









SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K


ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)


OF THE SECURITIES EXCHANGE ACT OF 1934


For the fiscal year ended December 31, 2005


Commission file number 1-9335


SCHAWK, INC.


(Exact name of Registrant as specified in its charter)


|                                                                                 |  |                                         
|-------------------------------------------------------------------------------- |  | ----------------------------------------
|Delaware                                                                         |  | 66-0323724                              
|(State or other jurisdiction of
    incorporation or organization)               |  | (I.R.S. Employer
    Identification No.)
|                                                                                
|1695 River Road
    Des Plaines, Illinois(Address of principal executive office) |  | 60018(Zip Code)                         

(Registrants telephone number, including area code)


847-827-9494


Securities registered pursuant to Section 12(b) of
the Act:


|                                          |  |                                     
|----------------------------------------- |  | ------------------------------------
|Title of Each Class                       |  | Name of Exchange on Which Registered
|                                          |  |                                     
|Class A Common Stock,
    $.008 par value |  | New York Stock Exchange             

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S-K 10-K 10-K. o




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12b-2 o þ






DOCUMENTS INCORPORATED BY REFERENCE












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##### 










SCHAWK, INC


FORM 10-K
ANNUAL REPORT


TABLE OF CONTENTS


DECEMBER 31, 2005


|                                                         |  |                                                                                           |    |      |    |  |  | 
|-------------------------------------------------------- |  | ----------------------------------------------------------------------------------------- | -- | ---- | -- |  |  | 
|                                                         |  |                                                                                           |    | Page |   
|                                                         |  |                                                                                           |    |      |   
|PART I                                                  
|Item 1.                                                  |  | Business                                                                                  |    |      | 3  | 
|Item 1a.                                                 |  | Risk Factors                                                                              |    |      | 11 | 
|Item 1b.                                                 |  | Unresolved Staff Comments                                                                 |    |      | 15 | 
|Item 2.                                                  |  | Properties                                                                                |    |      | 15 | 
|Item 3.                                                  |  | Legal Proceedings                                                                         |    |      | 18 | 
|Item 4.                                                  |  | Submission of Matters to a Vote of Security
    Holders                                   |    |      | 18 | 
|                                                        
|PART II                                                 
|Item 5.                                                  |  | Market for the Registrants Common
    Stock and Related Stockholder Matters              |    |      | 18 | 
|Item 6.                                                  |  | Selected Financial Data                                                                   |    |      | 20 | 
|Item 7.                                                  |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations |    |      | 20 | 
|Item 7a.                                                 |  | Quantitative and Qualitative Disclosures
    about Market Risk                            |    |      | 29 | 
|Item 8.                                                  |  | Financial Statements and Supplementary
    Data                                           |    |      | 30 | 
|Item 9.                                                  |  | Changes in and Disagreements with
    Accountants on Accounting And Financial Disclosures |    |      | 57 | 
|Item 9a.                                                 |  | Controls and Procedures                                                                   |    |      | 57 | 
|Item 9b.                                                 |  | Other Information                                                                         |    |      | 61 | 
|                                                        
|PART III                                                
|Item 10.                                                 |  | Directors and Executive Officers of the
    Registrant                                    |    |      | 61 | 
|Item 11.                                                 |  | Executive Compensation                                                                    |    |      | 61 | 
|Item 12.                                                 |  | Security Ownership of Certain Beneficial
    Owners and Management                        |    |      | 61 | 
|Item 13.                                                 |  | Certain Relationships and Related
    Transactions                                        |    |      | 61 | 
|Item 14.                                                 |  | Principal Accountant Fees and Services                                                    |    |      | 61 | 
|                                                        
|PART IV                                                 
|Item 15.                                                 |  | Exhibits and Financial Statement
    Schedules                                            |    |      | 61 | 
|Signatures                                               |  |                                                                                           | 66 |     
|List of Subsidiaries                                    
|Consent of Independent Registered Public Accounting Firm
|Certification of Chief Executive Officer                
|Certification of Chief Financial Officer                
|Certification of CEO and CFO                            



2



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PART I







|        |         
|------- | --------
|ITEM 1. | BUSINESS

General




point-of






| |   |                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------
| |  | ability to service our clients graphic requirements
    throughout the world;                                                               
|
| |  | rapid turnaround and delivery times;                                                                                                         
|
| |  | comprehensive,
    up-to-date knowledge of
    the printing press specifications of converters and printers
    located throughout the world;
|
| |  | high quality creative design capabilities and production art
    expertise;                                                                  
|
| |  | consistent reproduction of colors across multiple packaging and
    promotional media;                                                       
|
| |  | digital imaging asset management; and                                                                                                        
|
| |  | efficient workflow management.                                                                                                               



Graphic Services Industry


Industry services. point-of




3



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Size of industry.


start-ups


Graphic services for consumer products companies. point-of




4



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point-of point-of


Factors driving increased demand for our brand image
solutions.


Services


3-D




Graphic services.


Brand strategy and creative design. start-ups


Enterprise products.


5



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tm 3-D


state-of




Competitive Strengths




The Company is a leader in a highly fragmented market.


The Company has direct client relationships. on-site on-site


The Company has a comprehensive service offering.


6



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The Company has unique global capabilities.


The Company generates strong cash flow.


Strategy






| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Capitalizing on our recently enhanced platform. The
    Company seeks to capitalize on the breadth of its services and
    its global presence. The Companys dedicated business
    development team emphasizes the ability to tailor integrated
    brand image solutions on a global scale to meet our
    clients specific needs. Our total solution approach has
    recently yielded several significant new opportunities by
    expanding service offerings to existing clients and winning
    global representation of clients previously using our services
    only in a single market. This strategy is expected to drive
    additional organic growth in the future.
|
| | Matching our services to the needs of our clients. As our
    clients continually create new products and extend and enhance
    their existing brands, the Company continues to match its brand
    image solutions to meet the needs and, where necessary, adapt
    services as their needs change and grow. The Companys
    adaptability is exemplified by our ability to scale our service
    offerings, shift employees among our locations to address surges
    in a clients promotional activity, and originate services
    from additional global locations based on changes in a
    clients global branding strategy.                                             
|
| | Pursuing acquisitions opportunistically. Where
    opportunities arise and in response to client needs, Schawk will
    continue to seek strategic acquisitions of selected businesses
    to broaden our service offerings, enhance our client base or
    build a new market presence.                                                                                                                                                                                                                                                                                                                                                                                            

Recent Acquisitions


52-year




| |   |                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | expanding our geographic reach to Europe, Australia and India,
    which benefits our existing clients as they seek to establish
    global brand consistency; and                   
|
| |  | increasing and expanding the scope of our global service
    offerings, such as creative design and high end retouching, and
    entering into new markets, such as retail and media.

7



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out-of (point-of




non-U.S.




Marketing and Distribution




Clients


on-site


8



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on-site


back-to




Competition


state-of






Research and Development


off-the tm 3-D


9



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Employees




Backlog




Seasonality and Cyclicality


speed-to


Purchasing and Raw Materials




Intellectual Property




10



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3-D,


Available Information


www.schawk.com 10-K, 10-Q, 8-K,









|         |             
|-------- | ------------
|ITEM 1a. | RISK FACTORS



| |                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Companys business is sensitive to general
    economic conditions. An economic decline or other circumstances
    that result in reductions in our clients marketing and
    advertising budgets could negatively impact the Companys
    sales volume and revenues and the ability to respond to
    competition or take advantage of business opportunities.





| |                                                                       
| | ----------------------------------------------------------------------
| | The Companys operating results fluctuate from
    quarter to quarter.





| |   |                                                                                        
| | - | ---------------------------------------------------------------------------------------
| |  | timing of the completion of particular projects or orders;                             
|
| |  | material reduction or cancellation of major projects or the loss
    of a major client;
|
| |  | timing of new business;                                                                
|
| |  | differences in order flows;                                                            
|
| |  | sensitivity to general economic conditions;                                            
|
| |  | the health of the consumer products industry;                                          
|
| |  | the relative mix of different types of work with differing
    margins;                

11



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| |   |                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------
| |  | costs relating to the expansion of operations, including costs
    to integrate current and future acquisitions;
|
| |  | changes in interest costs and tax rates; and                                                                    
|
| |  | costs associated with compliance with legal and regulatory
    requirements.                                    

period-to




| |                                                         
| | --------------------------------------------------------
| | The Company is subject to unpredictable order
    flows.

speed-to




| |                                                 
| | ------------------------------------------------
| | The Company is dependent on certain key clients.





| |                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Companys foreign operations are subject to
    currency exchange, political, investment and other risks that
    could hinder the Company from transferring funds out of a
    foreign country, delay our debt service payments, cause the
    Companys operating costs to increase and adversely affect
    its results of operations.









| |   |                                             
| | - | --------------------------------------------
| |  | political, social and economic instability; 
|
| |  | war, civil disturbance or acts of terrorism;

12



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| |   |                                                                                                                                                           
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | taking of property by nationalization or expropriation without
    fair compensation;                                                                     
|
| |  | changes in government policies and regulations;                                                                                                           
|
| |  | imposition of limitations on conversions of foreign currencies
    into dollars or remittance of dividends and other payments by
    foreign subsidiaries;
|
| |  | imposition or increase of withholding and other taxes on
    remittances and other payments by foreign subsidiaries;                                      
|
| |  | hyperinflation in certain foreign countries; and                                                                                                          
|
| |  | impositions or increase of investment and other restrictions or
    requirements by foreign governments.                                                  



| |                                                           
| | ----------------------------------------------------------
| | The Company operates in a highly competitive
    industry.







| |                                                                                                     
| | ----------------------------------------------------------------------------------------------------
| | Failure to properly manage the Companys expanding
    operations may adversely impact our business.





| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | The Company may encounter difficulties arising from future
    acquisitions or consolidation efforts.





| |   |                                                                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | difficulty in assimilating the operations and personnel of the
    acquired company with our existing operations and realizing
    anticipated synergies;
|
| |  | the loss of key employees or key clients of the acquired company;                                                                                        
|
| |  | difficulty in maintaining uniform standards, controls,
    procedures and policies; and                                                                  
|
| |  | unrecorded liabilities of acquired companies that the Company
    failed to discover during our due diligence investigations.                            



13



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| |                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------
| | The loss of key personnel could adversely affect the
    Companys current operations and its ability to achieve
    continued growth.







| |                                                                                                                                                                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Work stoppages and other labor relations matters may make
    it substantially more difficult or expensive for us to produce
    our products and services, which could result in decreased sales
    or increased costs, either of which would negatively impact our
    financial condition and results of operations.





| |                                                          
| | ---------------------------------------------------------
| | The Company is subject to restrictive debt
    covenants.





| |                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company remains susceptible to risks associated with
    technological change, including risks based on the services the
    Company provides and may seek to provide in the future as a
    result of technological changes.



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| |                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company may be subject to losses that might not be
    covered in whole or in part by existing insurance coverage.
    These uninsured losses could result in substantial liabilities
    to us that would negatively impact our financial
    condition.








|         |                          
|-------- | -------------------------
|ITEM 1b. | UNRESOLVED STAFF COMMENTS








|        |           
|------- | ----------
|ITEM 2. | PROPERTIES



|                        |  |           |        |  |        |        |         |                                     |            |                |          |                
|----------------------- |  | --------- | ------ |  | ------ | ------ | ------- | ----------------------------------- | ---------- | -------------- | -------- | ---------------
|                        |  |           |        |  |        |        |         | Lease                               |            |               
|                        |  | Square    |        |  | Owned/ |        |         |                                     | Expiration |                |         
|Location                |  | Feet      |        |  | Leased |        | Purpose |                                     | Date       |                | Division
|                        |  |           |        |  |        |        |         |                                     |            |                |         
|                        |  | (Approx.) |        |  |        |        |         |                                     |            |                |         
|Antwerp, Belgium        |  |           | 39,000 |  |        | Owned  |         | Operating Facility                  |            | N/A            |          | Schawk Belgium 
|Battle Creek, Michigan  |  |           | 8,862  |  |        | Leased |         | General Offices Operating Facility  |            | August 2007    |          | Schawk U.S.A.  
|Birmingham, U.K.        |  |           | 12,037 |  |        | Leased |         | General Offices Operating Facility  |            | June 2006      |          | Schawk U.K.    
|Bristol, U.K.           |  |           | 9,200  |  |        | Leased |         | Vacant                              |            | September 2014 |          | Schawk U.K.    
|Carlstadt, New Jersey   |  |           | 45,999 |  |        | Leased |         | General Offices Operating Facility  |            | February 2011  |          | Schawk U.S.A.  
|Chennai, India          |  |           | 10,682 |  |        | Leased |         | General Offices Operating Facility  |            | October 2007   |          | Schawk Asia    
|Cherry Hill, New Jersey |  |           | 10,000 |  |        | Leased |         | General Offices, Operating Facility |            | January 2007   |          | Schawk U.S.A.  
|Chicago, Illinois       |  |           | 45,000 |  |        | Leased |         | Vacant                              |            | September 2009 |          | N/A            
|Chicago, Illinois       |  |           | 66,069 |  |        | Leased |         | General Offices Operating Facility  |            | June 2006      |          | Ambrosi        
|Chicago, Illinois       |  |           | 42,000 |  |        | Leased |         | General Offices Operating Facility  |            | June 2019      |          | Schawk U.S.A.  
|Chicago, Illinois       |  |           | 87,000 |  |        | Owned  |         | General Offices Operating Facility  |            | N/A            |          | Ambrosi        
|Chicago, Illinois       |  |           | 11,900 |  |        | Leased |         | General Offices                     |            | April 2010     |          | General Offices

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|                            |  |           |         |     |        |        |         |                                     |            |                |          |                 
|--------------------------- |  | --------- | ------- | --- | ------ | ------ | ------- | ----------------------------------- | ---------- | -------------- | -------- | ----------------
|                            |  |           |         |     |        |        |         | Lease                               |            |               
|                            |  | Square    |         |     | Owned/ |        |         |                                     | Expiration |                |         
|Location                    |  | Feet      |         |     | Leased |        | Purpose |                                     | Date       |                | Division
|                            |  |           |         |     |        |        |         |                                     |            |                |         
|                            |  | (Approx.) |         |     |        |        |         |                                     |            |                |         
|Cincinnati, Ohio            |  |           | 74,200  |     |        | Leased |         | General Offices, Operating Facility |            | August 2009    |          | Schawk U.S.A.   
|Cincinnati, Ohio            |  |           | 12,000  |     |        | Leased |         | General Offices Operating Facility  |            | August 2009    |          | Schawk U.S.A.   
|Costa Mesa, California      |  |           | 3,000   |     |        | Leased |         | General Offices, Operating Facility |            | May 2006       |          | Anthem U.S.A.   
|Crystal Lake, Illinois      |  |           | 78,800  |     |        | Owned  |         | General Offices Operating Facility  |            | N/A            |          | Schawk U.S.A.   
|Des Plaines, Illinois       |  |           | 18,200  |     |        | Owned  |         | Executive Offices                   |            | N/A            |          | Corporate Office
|Des Plaines, Illinois       |  |           | 55,000  |     |        | Leased |         | General Offices, Operating Facility |            | December 2010  |          | Schawk U.S.A.   
|Evanston, Illinois          |  |           | 21,200  |     |        | Leased |         | General Offices Operating Facility  |            | July 2007      |          | Schawk U.S.A.   
|Foster City, California     |  |           | 7,816   |     |        | Leased |         | Vacant                              |            | May 2008       |          | N/A             
|Franklin Park, Illinois     |  |           | 62,000  |     |        | Owned  |         | Vacant                              |            | N/A            |          | N/A             
|Hackettstown, New Jersey    |  |           | 3,000   |     |        | Leased |         | General Offices, Operating Facility |            | May 2006       |          | Anthem U.S.A.   
|Kalamazoo, Michigan         |  |           | 67,000  |     |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk U.S.A.   
|Kentwood, Michigan          |  |           | 30,400  |     |        | Leased |         | Vacant                              |            | February 2006  |          | N/A             
|Kobe, Japan                 |  |           | 800     |     |        | Leased |         | General Offices, Operating Facility |            | February 2007  |          | Anthem Asia     
|Leeds, U.K.                 |  |           | 16,200  |     |        | Leased |         | General Offices Operating Facility  |            | January 2010   |          | Schawk U.K.     
|Lincoln, Nebraska           |  |           | 10,000  |     |        | Owned  |         | Vacant                              |            | N/A            |          | N/A             
|Lithia Springs, Georgia     |  |           | 79,675  |     |        | Leased |         | General Offices Operating Facility  |            | July 2009      |          | Ambrosi         
|London, U.K.                |  |           | 42,691  | (1) |        | Leased |         | General Offices Operating Facility  |            | March 2015     |          | Schawk U.K.     
|London, U.K.                |  |           | 4,000   |     |        | Leased |         | Vacant                              |            | November 2009  |          | Schawk U.K.     
|Los Angeles, California     |  |           | 100,500 |     |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk U.S.A.   
|Manchester, U.K.            |  |           | 15,000  |     |        | Leased |         | Vacant                              |            | July 2006      |          | Schawk U.K.     
|Manchester, U.K.            |  |           | 45,200  |     |        | Leased |         | Operating Facility                  |            | September 2023 |          | Schawk U.K.     
|Minneapolis, Minnesota      |  |           | 31,000  |     |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk U.S.A.   
|Mississauga, Ontario Canada |  |           | 58,000  |     |        | Leased |         | General Offices, Operating Facility |            | December 2014  |          | Schawk Canada   
|N. Ryde, Australia          |  |           | 13,900  |     |        | Leased |         | General Offices Operating Facility  |            | May 2008       |          | Schawk Australia
|Nashua, New Hampshire       |  |           | 3,016   |     |        | Leased |         | General Offices, Operating Facility |            | November 2008  |          | Schawk U.S.A.   
|New Berlin, Wisconsin       |  |           | 43,000  |     |        | Leased |         | General Offices, Operating Facility |            | June 2008      |          | Schawk U.S.A.   
|New York, New York          |  |           | 10,000  |     |        | Leased |         | General Offices, Operating Facility |            | December 2008  |          | Schawk U.S.A.   
|New York, New York          |  |           | 52,500  |     |        | Leased |         | Subleasing                          |            | December 2012  |          | N/A             

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|                          |  |           |        |  |        |        |         |                                     |            |                |          |                
|------------------------- |  | --------- | ------ |  | ------ | ------ | ------- | ----------------------------------- | ---------- | -------------- | -------- | ---------------
|                          |  |           |        |  |        |        |         | Lease                               |            |               
|                          |  | Square    |        |  | Owned/ |        |         |                                     | Expiration |                |         
|Location                  |  | Feet      |        |  | Leased |        | Purpose |                                     | Date       |                | Division
|                          |  |           |        |  |        |        |         |                                     |            |                |         
|                          |  | (Approx.) |        |  |        |        |         |                                     |            |                |         
|New York, New York        |  |           | 10,000 |  |        | Leased |         | Vacant                              |            | December 2006  |          | N/A            
|New York, New York        |  |           | 8,000  |  |        | Leased |         | Subleasing                          |            | January 2011   |          | N/A            
|New York, New York        |  |           | 54,365 |  |        | Leased |         | General Offices, Operating Facility |            | November 2011  |          | Schawk U.S.A.  
|New York, New York        |  |           | 6,400  |  |        | Leased |         | General Offices, Operating Facility |            | January 2006   |          | Ambrosi        
|New York, New York        |  |           | 3,300  |  |        | Leased |         | General Offices, Operating Facility |            | December 2006  |          | Schawk U.S.A.  
|Newcastle, U.K.           |  |           | 17,000 |  |        | Leased |         | General Offices, Operating Facility |            | September 2015 |          | Schawk U.K.    
|Orlando, Florida          |  |           | 12,000 |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk U.S.A.  
|Penang, Malaysia          |  |           | 34,000 |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk Asia    
|Penang, Malaysia          |  |           | 1,706  |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk Asia    
|Penang, Malaysia          |  |           | 2,330  |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk Asia    
|Plano, Texas              |  |           | 12,287 |  |        | Leased |         | General Offices, Operating Facility |            | December 2011  |          | Schawk U.S.A.  
|Pontiac, Illinois         |  |           | 24,900 |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk U.S.A.  
|Queretaro, Mexico         |  |           | 18,000 |  |        | Owned  |         | General Offices, Operating Facility |            | N/A            |          | Schawk Mexico  
|Racine, Wisconsin         |  |           | 1,528  |  |        | Leased |         | General Offices, Operating Facility |            | March 2006     |          | Schawk U.S.A.  
|Redmond, Washington       |  |           | 28,000 |  |        | Leased |         | General Offices, Operating Facility |            | September 2006 |          | Schawk U.S.A.  
|Roseville, Minnesota      |  |           | 28,000 |  |        | Leased |         | General Offices, Operating Facility |            | May 2007       |          | Schawk U.S.A.  
|San Francisco, California |  |           | 18,208 |  |        | Leased |         | General Offices, Operating Facility |            | April 2010     |          | Schawk U.S.A.  
|San Francisco, California |  |           | 23,240 |  |        | Leased |         | General Offices, Operating Facility |            | May 2008       |          | Schawk U.S.A.  
|San Francisco, California |  |           | 8,100  |  |        | Leased |         | General Offices, Operating Facility |            | September 2008 |          | Anthem U.S.A.  
|Shanghai, China           |  |           | 19,400 |  |        | Leased |         | General Offices, Operating Facility |            | November 2006  |          | Schawk Asia    
|Shenzhen, China           |  |           | 7,100  |  |        | Leased |         | General Offices, Operating Facility |            | December 2008  |          | Schawk Shenzhen
|Shenzhen, China           |  |           | 11,300 |  |        | Leased |         | Operating Facility                  |            | July 2008      |          | Schawk Shenzhen
|Singapore                 |  |           | 7,500  |  |        | Leased |         | General Offices, Operating Facility |            | January 2007   |          | Schawk Asia    
|Slough, UK                |  |           | 3,000  |  |        | Leased |         | Operating Facility                  |            | January 2010   |          | Schawk U.K.    
|Smyrna, Georgia           |  |           | 25,200 |  |        | Leased |         | General Offices, Operating Facility |            | October 2008   |          | Schawk U.S.A.  

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|                           |  |           |        |  |        |        |         |                                     |            |                |          |               
|-------------------------- |  | --------- | ------ |  | ------ | ------ | ------- | ----------------------------------- | ---------- | -------------- | -------- | --------------
|                           |  |           |        |  |        |        |         | Lease                               |            |               
|                           |  | Square    |        |  | Owned/ |        |         |                                     | Expiration |                |         
|Location                   |  | Feet      |        |  | Leased |        | Purpose |                                     | Date       |                | Division
|                           |  |           |        |  |        |        |         |                                     |            |                |         
|                           |  | (Approx.) |        |  |        |        |         |                                     |            |                |         
|Stamford, Connecticut      |  |           | 20,000 |  |        | Leased |         | General Offices, Operating Facility |            | August 2007    |          | Schawk U.S.A. 
|Sterling Heights, Michigan |  |           | 26,400 |  |        | Leased |         | General Offices, Operating Facility |            | May 2008       |          | Schawk U.S.A. 
|Swindon, UK                |  |           | 39,000 |  |        | Leased |         | Subletting                          |            | September 2018 |          | Schawk U.K.   
|Toronto, Ontario, Canada   |  |           | 8,300  |  |        | Leased |         | General Offices, Operating Facility |            | January 2006   |          | Anthem Toronto
|Toronto, Ontario, Canada   |  |           | 17,500 |  |        | Leased |         | General Offices, Operating Facility |            | November 2007  |          | Schawk Toronto
|Troy, Michigan             |  |           | 34,866 |  |        | Leased |         | Vacant                              |            | December 2006  |          | N/A           
|Troy, Michigan             |  |           | 41,200 |  |        | Leased |         | Vacant                              |            | October 2006   |          | N/A           
|Tunbridge Wells, UK        |  |           | 6,400  |  |        | Leased |         | Subletting                          |            | March 2009     |          | Schawk U.K.   






|    |                                                                                                                                                                                                                                         
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The London U.K. property, with a total of 42,691 square
    feet, includes a section of approximately 18,000 square
    feet that is sublet to another tenant and another section of
    approximately 5,000 square feet that is vacant.






|        |                  
|------- | -----------------
|ITEM 3. | LEGAL PROCEEDINGS








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






PART II







|        |                                                                                                                        
|------- | -----------------------------------------------------------------------------------------------------------------------
|ITEM 5. | MARKET FOR THE REGISTRANTS COMMON STOCK, RELATED
    STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
    SECURITIES

Stock Prices






|               |  |          |               |  |          |   |               | 
|-------------- |  | -------- | ------------- |  | -------- | - | ------------- | 
|               |  | 2005     |               |  | 2004     |  
|Quarter Ended: |  | High/Low |               |  | High/Low |  
|               |  |          |               |  |          |  
|March 31       |  | $        | 21.98 - 17.70 |  |          | $ | 15.65 - 12.48 | 
|June 30        |  |          | 26.00 - 17.96 |  |          |   | 14.50 - 12.76 | 
|September 30   |  |          | 24.75 - 19.64 |  |          |   | 14.70 - 13.10 | 
|December 31    |  |          | 21.40 - 17.05 |  |          |   | 18.90 - 14.43 | 

18



---



##### Table of Contents



Dividends Declared Per Class A Common Share


|               |       |      |        |        |      |   |        |        | 
|-------------- | ----- | ---- | ------ | ------ | ---- | - | ------ | ------ | 
|Quarter Ended: |       | 2005 |        |        | 2004 |  
|               |       |      |        |        |      |  
|March 31       |       | $    | 0.0325 |        |      | $ | 0.0325 |       
|June 30        |       |      | 0.0325 |        |      |   | 0.0325 |       
|September 30   |       |      | 0.0325 |        |      |   | 0.0325 |       
|December 31    |       |      | 0.0325 |        |      |   | 0.0325 |       
|               |       |      |        |        |      |  
|               | Total |      | $      | 0.1300 |      |   | $      | 0.1300 | 
|               |       |      |        |        |      |  

Equity Compensation Plan Information




|                                                           |  |                   |       |  |                   |   |           |                     |  |  |       | 
|---------------------------------------------------------- |  | ----------------- | ----- |  | ----------------- | - | --------- | ------------------- |  |  | ----- | 
|                                                           |  | Number of         |       |  |                   |   |          
|                                                           |  | Securities to be  |       |  |                   |   | Number of |                    
|                                                           |  | Issued Upon       |       |  | Weighted-Average  |   |           | Securities          | 
|                                                           |  | Exercise of       |       |  | Exercise Price of |   |           | Remaining Available | 
|                                                           |  | Outstanding       |       |  | Outstanding       |   |           | for Future Issuance | 
|                                                           |  | Options, Warrants |       |  | Options, Warrants |   |           | Under Equity        | 
|Plan Category                                              |  | and Rights        |       |  | and Rights        |   |           | Compensation Plans  | 
|                                                           |  |                   |       |  |                   |   |           |                     | 
|Equity compensation plans approved by security holders     |  |                   | 3,333 |  |                   | $ | 11.73     |                     |  |  | 1,025 | 
|Equity compensation plans not approved by security holders |  |                   |      |  |                   |   |          |                     |  |  |      | 
|                                                           |  |                   |       |  |                   |   |           |                     | 
|TOTAL                                                      |  |                   | 3,333 |  |                   | $ | 11.73     |                     |  |  | 1,025 | 
|                                                           |  |                   |       |  |                   |   |           |                     | 

Purchases of Equity Securities by the Company






|           |  |           |     |  |            |                   |       |             |                 |  |                 |  |  |  |   | 
|---------- |  | --------- | --- |  | ---------- | ----------------- | ----- | ----------- | --------------- |  | --------------- |  |  |  | - | 
|           |  |           |     |  |            | No. Shares        |       |             |                
|           |  |           |     |  |            | Purchased as Part |       |             | Dollar Value of | 
|           |  | Total No. |     |  | Avg. Price |                   |       | of Publicly |                 |  | Shares that May | 
|           |  | Shares    |     |  | Paid per   |                   |       | Announced   |                 |  | be Purchased    | 
|Period     |  | Purchased |     |  | Share      |                   |       | Program     |                 |  | Under Program   | 
|           |  |           |     |  |            |                   |       |             |                 |  |                 | 
|January    |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|February   |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|March      |  |           | 2   |  |            | $                 | 20.98 |             |                 |  |                |  |  |  |  | 
|April      |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|May        |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|June       |  |           | 31  |  |            | $                 | 22.33 |             |                 |  |                |  |  |  |  | 
|July       |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|August     |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|September  |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|October    |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|November   |  |           |    |  |            |                   |      |             |                 |  |                |  |  |  |  | 
|December   |  |           | 131 |  |            | $                 | 18.20 |             |                 |  |                |  |  |  |  | 
|           |  |           |     |  |            |                   |       |             |                 |  |                 | 
|2005 Total |  |           | 164 |  |            | $                 | 19.01 |             |                 |  |                |  |  |  |  | 
|           |  |           |     |  |            |                   |       |             |                 |  |                 | 

19



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|        |                        
|------- | -----------------------
|ITEM 6. | SELECTED FINANCIAL DATA

|                                                                                      |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |        | 
|------------------------------------------------------------------------------------- | ------------------------------- | ---------------------------------------- | ------- | ------ | ---- | - | ------- | ------ |  | - | ------- | ------ |  | ---- | ------- | ------ |  | - | ------- | ------ | 
|                                                                                      |                                 | Year Ended December 31,                  |        
|                                                                                      |                                 |                                          |        
|                                                                                      |                                 | 2005                                     |         |        | 2004 |   |         | 2003   |  |   | 2002    |        |  | 2001 |        
|                                                                                      |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |        
|                                                                                      |                                 | (In thousands, except per share amounts) |        
|CONSOLIDATED INCOME STATEMENT INFORMATION                                             |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |       
|Net Sales                                                                             |                                 | $                                        | 614,520 |        |      | $ | 238,345 |        |  | $ | 201,031 |        |  | $    | 186,189 |        |  | $ | 189,643 |       
|Operating Income(a)                                                                   |                                 |                                          | 57,714  |        |      |   | 37,792  |        |  |   | 27,536  |        |  |      | 22,032  |        |  |   | 17,313  |       
|Income Before Income Taxes and Minority Interest                                      |                                 |                                          | 48,721  |        |      |   | 36,020  |        |  |   | 27,264  |        |  |      | 19,713  |        |  |   | 13,129  |       
|Income Taxes                                                                          |                                 |                                          | 18,249  |        |      |   | 13,342  |        |  |   | 10,280  |        |  |      | 6,203   |        |  |   | 5,320   |       
|Minority Interest in net loss of subsidiary                                           |                                 |                                          |        |        |      |   |        |        |  |   |        |        |  |      | 21      |        |  |   | 209     |       
|Net Income                                                                            |                                 |                                          | 30,472  |        |      |   | 22,678  |        |  |   | 16,984  |        |  |      | 13,531  |        |  |   | 8,018   |       
|Net Income Per Common Share                                                           |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |       
|                                                                                      | Basic                           |                                          | $       | 1.19   |      |   | $       | 1.05   |  |   | $       | 0.79   |  |      | $       | 0.63   |  |   | $       | 0.37   | 
|                                                                                      | Diluted                         |                                          |         | 1.13   |      |   |         | 1.01   |  |   |         | 0.78   |  |      |         | 0.62   |  |   |         | 0.37   | 
|Prior-year amounts have been reclassified to conform to
    current-year presentation |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |       
|CONSOLIDATED BALANCE SHEET INFORMATION                                                |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |       
|Working Capital                                                                       |                                 | $                                        | 83,796  |        |      | $ | 41,141  |        |  | $ | 30,526  |        |  | $    | 26,654  |        |  | $ | 26,796  |       
|Total Assets                                                                          |                                 |                                          | 558,818 |        |      |   | 220,763 |        |  |   | 159,691 |        |  |      | 160,470 |        |  |   | 166,125 |       
|Long-Term Debt and Capital Lease Obligations                                          |                                 |                                          | 169,579 |        |      |   | 39,964  |        |  |   | 21,021  |        |  |      | 37,232  |        |  |   | 52,131  |       
|Stockholders Equity                                                                  |                                 |                                          | 231,396 |        |      |   | 131,440 |        |  |   | 106,372 |        |  |      | 89,767  |        |  |   | 79,537  |       
|OTHER DATA                                                                            |                                 |                                          |         |        |      |   |         |        |  |   |         |        |  |      |         |        |  |   |         |       
|                                                                                      | Cash Dividends per Common Share |                                          | $       | 0.13   |      |   | $       | 0.13   |  |   | $       | 0.13   |  |      | $       | 0.13   |  |   | $       | 0.13   | 
|                                                                                      | Depreciation and Amortization   |                                          |         | 27,049 |      |   |         | 12,726 |  |   |         | 11,416 |  |      |         | 11,977 |  |   |         | 14,138 | 
|                                                                                      | Capital Expenditures            |                                          |         | 22,158 |      |   |         | 12,238 |  |   |         | 6,933  |  |      |         | 7,634  |  |   |         | 14,431 | 






|    |                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------
|(a) | The year ended December 31, 2001(prior to adoption of
    SFAS No. 142) includes goodwill amortization of $2,161.






|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|ITEM 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
    CONDITION AND RESULTS OF OPERATIONS

(Thousands of dollars, except per share amounts)




20



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EXECUTIVE-LEVEL OVERVIEW








| |   |                       
| | - | ----------------------
| |  | Planning and Messaging
|
| |  | Strategic Design      
|
| |  | Content Creation      
|
| |  | File Building         
|
| |  | Retouching            
|
| |  | Art Production        
|
| |  | Pre-Media             







21



---



##### Table of Contents







Acquisitions




Winnetts.


Seven Worldwide.






22



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##### Table of Contents







RESULTS OF OPERATIONS


YEARS ENDED DECEMBER 31, 2005 and 2004


Schawk, Inc.


Comparative Consolidated Statements of Operations


Years Ended December 31, 2005 and 2004


|                                             |  |                |         |   |      |   |         |          |  |   |         |   |  |  |       |  
|-------------------------------------------- |  | -------------- | ------- | - | ---- | - | ------- | -------- |  | - | ------- | - |  |  | ----- | -
|                                             |  |                |         |   |      |   |         | %        | 
|                                             |  | 2005           |         |   | 2004 |   |         | $ Change |  |   | Change  |  
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|                                             |  | (In thousands) |        
|Net sales                                    |  | $              | 614,520 |   |      | $ | 238,345 |          |  | $ | 376,175 |   |  |  | 157.8 | %
|Cost of sales                                |  |                | 403,064 |   |      |   | 137,017 |          |  |   | 266,047 |   |  |  | 194.2 | %
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|Gross profit                                 |  |                | 211,456 |   |      |   | 101,328 |          |  |   | 110,128 |   |  |  | 108.7 | %
|Gross margin percentage                      |  |                | 34.4    | % |      |   | 42.5    | %        |  |   |         |   |  |  |       |  
|Selling, general and administrative expenses |  |                | 146,573 |   |      |   | 63,536  |          |  |   | 83,037  |   |  |  | 130.7 | %
|Acquisition and integration expenses         |  |                | 7,169   |   |      |   |        |          |  |   | 7,169   |   |  |  | nm    |  
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|Operating income                             |  |                | 57,714  |   |      |   | 37,792  |          |  |   | 19,922  |   |  |  | 52.7  | %
|Operating margin percentage                  |  |                | 9.4     | % |      |   | 15.9    | %        |  |   |         |   |  |  |       |  
|Other income (expense)                       |  |                |         |   |      |   |         |          |  |   |         |   |  |  |       |  
|Interest and dividend income                 |  |                | 359     |   |      |   | 188     |          |  |   | 171     |   |  |  | 91.0  | %
|Interest expense                             |  |                | (9,859  | ) |      |   | (1,960  | )        |  |   | (7,899  | ) |  |  | 403.0 | %
|Other income (expense)                       |  |                | 507     |   |      |   |        |          |  |   | 507     |   |  |  | nm    |  
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|                                             |  |                | (8,993  | ) |      |   | (1,772  | )        |  |   | (7,221  | ) |  |  | 407.5 | %
|Income before income taxes                   |  |                | 48,721  |   |      |   | 36,020  |          |  |   | 12,701  |   |  |  | 35.3  | %
|Income tax provision                         |  |                | 18,249  |   |      |   | 13,342  |          |  |   | 4,907   |   |  |  | 36.8  | %
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|Effective income tax rate                    |  |                | 37.5    | % |      |   | 37.0    | %        |  |   |         |   |  |  |       |  
|                                             |  |                |         |   |      |   |         |          |  |   |         |  
|Net income                                   |  | $              | 30,472  |   |      | $ | 22,678  |          |  | $ | 7,794   |   |  |  | 34.4  | %
|                                             |  |                |         |   |      |   |         |          |  |   |         |  






Net sales


23



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##### Table of Contents



Gross margin


Operating income


Other income (expense)


Income tax provision


Net income


Basic and diluted earnings per share


RESULTS OF OPERATIONS


YEARS ENDED DECEMBER 31, 2004 and 2003


Schawk, Inc.


Comparative Consolidated Statements of Operations


Years Ended December 31, 2004 and 2003


|                                                 |  |                |         |   |      |   |         |          |  |   |        |   |  |  |      |  
|------------------------------------------------ |  | -------------- | ------- | - | ---- | - | ------- | -------- |  | - | ------ | - |  |  | ---- | -
|                                                 |  |                |         |   |      |   |         | %        | 
|                                                 |  | 2004           |         |   | 2003 |   |         | $ Change |  |   | Change |  
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|                                                 |  | (In thousands) |        
|Net sales                                        |  | $              | 238,345 |   |      | $ | 201,031 |          |  | $ | 37,314 |   |  |  | 18.6 | %
|Cost of sales                                    |  |                | 137,017 |   |      |   | 119,760 |          |  |   | 17,257 |   |  |  | 14.4 | %
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|Gross profit                                     |  |                | 101,328 |   |      |   | 81,271  |          |  |   | 20,057 |   |  |  | 24.7 | %
|Gross margin percentage                          |  |                | 42.5    | % |      |   | 40.4    | %        |  |   |        |   |  |  |      |  
|Selling, general and administrative expenses     |  |                | 63,536  |   |      |   | 53,735  |          |  |   | 9,801  |   |  |  | 18.2 | %
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|Operating income                                 |  |                | 37,792  |   |      |   | 27,536  |          |  |   | 10,256 |   |  |  | 37.2 | %
|Operating margin percentage                      |  |                | 15.9    | % |      |   | 13.7    | %        |  |   |        |   |  |  |      |  
|Other income (expense)                           |  |                |         |   |      |   |         |          |  |   |        |   |  |  |      |  
|Interest and dividend income                     |  |                | 188     |   |      |   | 72      |          |  |   | 116    |   |  |  | nm   |  
|Interest expense                                 |  |                | (1,960  | ) |      |   | (1,900  | )        |  |   | (60    | ) |  |  | 3.2  | %
|Other income (expense)                           |  |                |        |   |      |   | 1,556   |          |  |   | (1,556 | ) |  |  | nm   |  
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|                                                 |  |                | (1,772  | ) |      |   | (272    | )        |  |   | (1,500 | ) |  |  | nm   |  
|Income before income taxes and minority interest |  |                | 36,020  |   |      |   | 27,264  |          |  |   | 8,756  |   |  |  | 32.1 | %
|Income tax provision                             |  |                | 13,342  |   |      |   | 10,280  |          |  |   | 3,062  |   |  |  | 29.8 | %
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|Effective income tax rate                        |  |                | 37.0    | % |      |   | 37.7    | %        |  |   |        |   |  |  |      |  
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  
|Net income                                       |  | $              | 22,678  |   |      | $ | 16,984  |          |  | $ | 5,694  |   |  |  | 33.5 | %
|                                                 |  |                |         |   |      |   |         |          |  |   |        |  






24



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##### Table of Contents



Net sales


Gross margin


Operating income


Other income (expense)


Income tax provision


Net income


Basic and diluted earnings per share


LIQUIDITY AND CAPITAL RESOURCES




Cash provided by (used in) Operating Activities






Cash used in Investing Activities




25



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##### Table of Contents





Cash provided by Financing Activities














SEASONALITY




Off-Balance Sheet Arrangements and Contractual Obligations




26



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##### Table of Contents





|                            |  |                        |         |           |        |   |        |       |  |     |        |  |           |         |         |  |  |   |        | 
|--------------------------- |  | ---------------------- | ------- | --------- | ------ | - | ------ | ----- |  | --- | ------ |  | --------- | ------- | ------- |  |  | - | ------ | 
|                            |  | Payments Due by Period |        
|                            |  |                        |        
|                            |  |                        |         | Less Than |        |   | 1-3    |       |  | 3-5 |        |  | More Than |        
|Contractual Obligations     |  | Total                  |         |           | 1 Year |   |        | Years |  |     | Years  |  |           | 5 Years |        
|                            |  |                        |         |           |        |   |        |       |  |     |        |  |           |         |        
|Long-Term Debt Obligations  |  | $                      | 169,533 |           |        | $ | 5      |       |  | $   | 5,722  |  |           | $       | 111,662 |  |  | $ | 52,144 | 
|Capital Lease Obligations   |  |                        | 523     |           |        |   | 471    |       |  |     | 52     |  |           |         |        |  |  |   |       | 
|Operating Lease Obligations |  |                        | 87,965  |           |        |   | 19,697 |       |  |     | 26,262 |  |           |         | 18,019  |  |  |   | 23,987 | 
|Purchase Obligations        |  |                        | 746     |           |        |   | 746    |       |  |     |       |  |           |         |        |  |  |   |       | 
|Deferred Compensation       |  |                        | 1,301   |           |        |   | 34     |       |  |     | 39     |  |           |         | 11      |  |  |   | 1,217  | 
|                            |  |                        |         |           |        |   |        |       |  |     |        |  |           |         |        
|Total                       |  | $                      | 260,068 |           |        | $ | 20,953 |       |  | $   | 32,075 |  |           | $       | 129,692 |  |  | $ | 77,348 | 





Critical Accounting Policies






Accounts Receivable.


Impairment of Long-Lived Assets.


Goodwill and Other Acquired Intangible Assets.


27



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##### Table of Contents







Customer Rebates.


Stock-Based Compensation. Accounting for Stock Issued to
Employees Share-Based Payments. 10-K


Income Taxes.




Exit Reserves.


New Accounting Pronouncements


Share-Based Payment Accounting for Stock-Based
Compensation, Accounting for Stock Issued to Employees.


28



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Impact of Inflation









|         |                                                               
|-------- | --------------------------------------------------------------
|ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK

Interest Rate Exposure




Foreign Exchange Exposure




29



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|        |                                            
|------- | -------------------------------------------
|ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

|                                                                                                       |  |      |    | 
|------------------------------------------------------------------------------------------------------ |  | ---- | -- | 
|Index to Financial Statements                                                                          |  | Page |   
|                                                                                                       |  |      |   
|Managements Responsibilities for
    Financial Reporting                                              |  |      | 31 | 
|Report of Independent Registered Public
    Accounting Firm                                            |  |      | 32 | 
|FINANCIAL STATEMENTS:                                                                                  |  |      |    | 
|Consolidated Balance Sheets 
    December 31, 2005 and 2004                                           |  |      | 33 | 
|Consolidated Statements of
    Operations  Years Ended December 31, 2005, 2004
    and 2003           |  |      | 34 | 
|Consolidated Statements of Cash
    Flows  Years Ended December 31, 2005, 2004 and
    2003           |  |      | 35 | 
|Consolidated Statements of
    Stockholders Equity  Years Ended
    December 31, 2005, 2004 and 2003 |  |      | 36 | 
|Notes to Consolidated Financial
    Statements                                                         |  |      | 37 | 
|FINANCIAL STATEMENT SCHEDULES:                                                                         |  |      |    | 
|SCHEDULE II  Valuation
    Reserves                                                                   |  |      | 65 | 

30



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MANAGEMENTS RESPONSIBILITIES FOR FINANCIAL
REPORTING


10-K






|                                                                                                             |  |                                                                                                                                              
|------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------
|/s/ David A. SchawkDavid A. Schawk
    President and Chief Executive Officer
    Principal Executive Officer |  | /s/ James J. PattersonJames J. Patterson
    Senior Vice President and Chief Financial Officer
    Principal Financial and Accounting Officer

31



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
















| |                  
| | -----------------
| | Ernst & Young LLP





32



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Schawk, Inc.





Consolidated Balance Sheets


|                                           |                                                                                                          |                |         |         |      |   |         |         |  
|------------------------------------------ | -------------------------------------------------------------------------------------------------------- | -------------- | ------- | ------- | ---- | - | ------- | ------- | -
|                                           |                                                                                                          | December 31    |        
|                                           |                                                                                                          |                |        
|                                           |                                                                                                          | 2005           |         |         | 2004 |  
|                                           |                                                                                                          |                |         |         |      |  
|                                           |                                                                                                          | (In thousands) |        
|ASSETS                                    
|Current assets:                            |                                                                                                          |                |         |         |      |   |         |        
|                                           | Cash and cash equivalents                                                                                |                | $       | 7,522   |      |   | $       | 7,268   |  
|                                           | Trade accounts receivable, less allowance for doubtful accounts
    of $6,323 in 2005 and $1,773 in 2004 |                |         | 131,747 |      |   |         | 56,332  |  
|                                           | Inventories                                                                                              |                |         | 29,323  |      |   |         | 10,339  |  
|                                           | Prepaid expenses and other                                                                               |                |         | 10,131  |      |   |         | 4,702   |  
|                                           | Refundable income taxes                                                                                  |                |         |        |      |   |         | 1,832   |  
|                                           | Deferred income taxes                                                                                    |                |         | 9,845   |      |   |         | 2,353   |  
|                                           |                                                                                                          |                |         |         |      |  
|Total current assets                       |                                                                                                          |                | 188,568 |         |      |   | 82,826  |        
|Property and equipment, net                |                                                                                                          |                | 78,858  |         |      |   | 46,431  |        
|Goodwill                                   |                                                                                                          |                | 233,838 |         |      |   | 71,720  |        
|Intangible assets                          |                                                                                                          |                | 50,984  |         |      |   | 12,754  |        
|Other assets                               |                                                                                                          |                | 6,570   |         |      |   | 7,032   |        
|                                           |                                                                                                          |                |         |         |      |  
|Total assets                               |                                                                                                          | $              | 558,818 |         |      | $ | 220,763 |        
|                                           |                                                                                                          |                |         |         |      |  
|                                          
|LIABILITIES AND STOCKHOLDERS EQUITY      
|Current liabilities:                       |                                                                                                          |                |         |         |      |   |         |        
|                                           | Trade accounts payable                                                                                   |                | $       | 28,502  |      |   | $       | 8,424   |  
|                                           | Accrued expenses                                                                                         |                |         | 69,449  |      |   |         | 26,578  |  
|                                           | Income taxes payable                                                                                     |                |         | 6,367   |      |   |         |        |  
|                                           | Current portion of long-term debt and capital lease obligations                                          |                |         | 454     |      |   |         | 6,683   |  
|                                           |                                                                                                          |                |         |         |      |  
|Total current liabilities                  |                                                                                                          |                | 104,772 |         |      |   | 41,685  |        
|Long-term debt                             |                                                                                                          |                | 169,528 |         |      |   | 39,500  |        
|Capital lease obligations                  |                                                                                                          |                | 51      |         |      |   | 464     |        
|Other long-term liabilities                |                                                                                                          |                | 27,383  |         |      |   | 979     |        
|Deferred income taxes                      |                                                                                                          |                | 25,688  |         |      |   | 6,695   |        
|Stockholders Equity:                      |                                                                                                          |                |         |         |      |   |         |        
|                                           | Common stock                                                                                             |                |         | 225     |      |   |         | 191     |  
|                                           | Additional paid-in capital                                                                               |                |         | 168,777 |      |   |         | 92,350  |  
|                                           | Retained earnings                                                                                        |                |         | 88,424  |      |   |         | 61,330  |  
|                                           | Accumulated comprehensive income, net                                                                    |                |         | 1,933   |      |   |         | 2,442   |  
|                                           |                                                                                                          |                |         |         |      |  
|                                           |                                                                                                          |                | 259,359 |         |      |   | 156,313 |        
|                                           | Treasury stock, at cost                                                                                  |                |         | (27,963 | )    |   |         | (24,873 | )
|                                           |                                                                                                          |                |         |         |      |  
|Total stockholders equity                 |                                                                                                          |                | 231,396 |         |      |   | 131,440 |        
|                                           |                                                                                                          |                |         |         |      |  
|Total liabilities and stockholders equity |                                                                                                          | $              | 558,818 |         |      | $ | 220,763 |        
|                                           |                                                                                                          |                |         |         |      |  



33



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Schawk, Inc.





Consolidated Statements of Operations


|                                              |  |                                          |         |   |      |   |         |      |  |   |         |  
|--------------------------------------------- |  | ---------------------------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                              |  | Years Ended December 31                  |        
|                                              |  |                                          |        
|                                              |  | 2005                                     |         |   | 2004 |   |         | 2003 | 
|                                              |  |                                          |         |   |      |   |         |      | 
|                                              |  | (In thousands, except per share amounts) |        
|Net sales                                     |  | $                                        | 614,520 |   |      | $ | 238,345 |      |  | $ | 201,031 |  
|Cost of sales                                 |  |                                          | 403,064 |   |      |   | 137,017 |      |  |   | 119,760 |  
|                                              |  |                                          |         |   |      |   |         |      | 
|Gross profit                                  |  |                                          | 211,456 |   |      |   | 101,328 |      |  |   | 81,271  |  
|Selling, general, and administrative expenses |  |                                          | 146,573 |   |      |   | 63,536  |      |  |   | 53,735  |  
|Acquisition and integration expenses          |  |                                          | 7,169   |   |      |   |        |      |  |   |        |  
|                                              |  |                                          |         |   |      |   |         |      | 
|Operating income                              |  |                                          | 57,714  |   |      |   | 37,792  |      |  |   | 27,536  |  
|Other income (expense):                       |  |                                          |         |   |      |   |         |      |  |   |         |  
|Interest and dividend income                  |  |                                          | 359     |   |      |   | 188     |      |  |   | 72      |  
|Interest expense                              |  |                                          | (9,859  | ) |      |   | (1,960  | )    |  |   | (1,900  | )
|Other                                         |  |                                          | 507     |   |      |   |        |      |  |   | 1,556   |  
|                                              |  |                                          |         |   |      |   |         |      | 
|                                              |  |                                          | (8,993  | ) |      |   | (1,772  | )    |  |   | (272    | )
|                                              |  |                                          |         |   |      |   |         |      | 
|Income before income taxes                    |  |                                          | 48,721  |   |      |   | 36,020  |      |  |   | 27,264  |  
|Income tax provision                          |  |                                          | 18,249  |   |      |   | 13,342  |      |  |   | 10,280  |  
|                                              |  |                                          |         |   |      |   |         |      | 
|Net income                                    |  | $                                        | 30,472  |   |      | $ | 22,678  |      |  | $ | 16,984  |  
|                                              |  |                                          |         |   |      |   |         |      | 
|Earnings per share:                           |  |                                          |         |   |      |   |         |      |  |   |         |  
|Basic                                         |  | $                                        | 1.19    |   |      | $ | 1.05    |      |  | $ | 0.79    |  
|Diluted                                       |  | $                                        | 1.13    |   |      | $ | 1.01    |      |  | $ | 0.78    |  
|Weighted average shares outstanding:          |  |                                          |         |   |      |   |         |      |  |   |         |  
|Basic                                         |  |                                          | 25,529  |   |      |   | 21,603  |      |  |   | 21,379  |  
|Diluted                                       |  |                                          | 26,963  |   |      |   | 22,515  |      |  |   | 21,839  |  
|Dividends per Class A common share            |  | $                                        | 0.13    |   |      | $ | 0.13    |      |  | $ | 0.13    |  



34



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Schawk, Inc.





Consolidated Statements of Cash Flows


|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |        |       |  
|--------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------- | ------------------------------------------- | -------- | ------ | ------- | - | ------- | ------ | ------- | - | ------- | ------ | ----- | -
|                                                                                  |                                                                                    | Years Ended December 31                     |         
|                                                                                  |                                                                                    |                                             |         
|                                                                                  |                                                                                    | 2005                                        |          |        | 2004    |   |         | 2003   |        
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|                                                                                  |                                                                                    | (In thousands)                              |         
|Operating activities                                                              |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |       
|Net income                                                                        |                                                                                    | $                                           | 30,472   |        |         | $ | 22,678  |        |         | $ | 16,984  |       
|Adjustments to reconcile net income to cash provided by
    operating activities: |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |       
|                                                                                  | Depreciation                                                                       |                                             |          | 22,606 |         |   |         | 11,803 |         |   |         | 11,416 |      
|                                                                                  | Amortization                                                                       |                                             |          | 4,443  |         |   |         | 923    |         |   |         |       |      
|                                                                                  | Deferred income taxes                                                              |                                             |          | 2,761  |         |   |         | (789   | )       |   |         | 917    |      
|                                                                                  | Loss (gain) realized on sale of equipment                                          |                                             |          | 295    |         |   |         | 101    |         |   |         | (635   | )    
|                                                                                  | Tax benefit from stock options exercised                                           |                                             |          | 1,657  |         |   |         |       |         |   |         |       |      
|                                                                                  | Changes in operating assets and liabilities, net of effects from
    acquisitions: |                                             |          |        |         |   |         |        |         |   |         |        |      
|                                                                                  |                                                                                    | Trade accounts receivable                   |          |        | (4,919  | ) |         |        | (14,230 | ) |         |        | 2,863 |  
|                                                                                  |                                                                                    | Inventories                                 |          |        | 947     |   |         |        | (231    | ) |         |        | 455   |  
|                                                                                  |                                                                                    | Prepaid expenses and other                  |          |        | (1,033  | ) |         |        | 431     |   |         |        | (363  | )
|                                                                                  |                                                                                    | Trade accounts payable and accrued expenses |          |        | (22,795 | ) |         |        | 4,562   |   |         |        | 448   |  
|                                                                                  |                                                                                    | Income taxes refundable/payable             |          |        | 347     |   |         |        | 1,185   |   |         |        | 131   |  
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Net cash provided by operating activities                                         |                                                                                    |                                             | 34,781   |        |         |   | 26,433  |        |         |   | 32,216  |       
|Investing activities                                                              |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |       
|Proceeds from disposal of property and equipment                                  |                                                                                    |                                             | 2,213    |        |         |   | 248     |        |         |   | 1,713   |       
|Purchases of property and equipment                                               |                                                                                    |                                             | (22,158  | )      |         |   | (12,238 | )      |         |   | (6,933  | )     
|Acquisitions, net of cash acquired                                                |                                                                                    |                                             | (205,702 | )      |         |   | (29,278 | )      |         |   | (2,170  | )     
|Contingent acquisition purchase price paid to escrow account                      |                                                                                    |                                             |         |        |         |   | (2,574  | )      |         |   |        |       
|Other                                                                             |                                                                                    |                                             | (84      | )      |         |   | (527    | )      |         |   | (160    | )     
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Net cash used in investing activities                                             |                                                                                    |                                             | (225,731 | )      |         |   | (44,369 | )      |         |   | (7,550  | )     
|Financing activities                                                              |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |       
|Proceeds from debt                                                                |                                                                                    |                                             | 151,825  |        |         |   | 33,200  |        |         |   | 19,562  |       
|Issuance of common stock                                                          |                                                                                    |                                             | 74,805   |        |         |   | 4,428   |        |         |   | 2,012   |       
|Principal payments on debt                                                        |                                                                                    |                                             | (27,841  | )      |         |   | (14,700 | )      |         |   | (39,062 | )     
|Principal payments on capital lease obligations                                   |                                                                                    |                                             | (648     | )      |         |   | (66     | )      |         |   | (255    | )     
|Cash dividends                                                                    |                                                                                    |                                             | (3,354   | )      |         |   | (2,790  | )      |         |   | (2,758  | )     
|Purchase of common stock                                                          |                                                                                    |                                             | (3,115   | )      |         |   | (603    | )      |         |   | (2,278  | )     
|Capitalized loan fees                                                             |                                                                                    |                                             | (580     | )      |         |   |        |        |         |   |        |       
|Increase in deferred compensation liability                                       |                                                                                    |                                             | 302      |        |         |   |        |        |         |   |        |       
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Net cash provided by (used in) financing activities                               |                                                                                    |                                             | 191,394  |        |         |   | 19,469  |        |         |   | (22,779 | )     
|Effect of foreign currency rate changes                                           |                                                                                    |                                             | (190     | )      |         |   | 508     |        |         |   | 1,289   |       
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Net increase in cash and cash equivalents                                         |                                                                                    |                                             | 254      |        |         |   | 2,041   |        |         |   | 3,176   |       
|Cash and cash equivalents beginning of period                                     |                                                                                    |                                             | 7,268    |        |         |   | 5,227   |        |         |   | 2,051   |       
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Cash and cash equivalents end of period                                           |                                                                                    | $                                           | 7,522    |        |         | $ | 7,268   |        |         | $ | 5,227   |       
|                                                                                  |                                                                                    |                                             |          |        |         |   |         |        |        
|Supplementary disclosure of cash flow information:                                |                                                                                    |                                             |          |        |         |   |         |        |         |   |         |       
|Dividends issued in the form of Class A common stock                              |                                                                                    | $                                           | 24       |        |         | $ | 19      |        |         | $ | 18      |       
|Cash paid for interest                                                            |                                                                                    |                                             | 7,355    |        |         |   | 1,876   |        |         |   | 1,865   |       
|Cash paid for income taxes                                                        |                                                                                    |                                             | 14,559   |        |         |   | 13,025  |        |         |   | 9,215   |       



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Schawk, Inc.





Consolidated Statements of Stockholders Equity


Years Ended December 31, 2003, 2004 and 2005


|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |   |         |   |  |   |         |  
|------------------------------------------------------------------------ |  | -------------- | --- |  | ---------- | - | ------- | -------- |  | ----------- | ------------- | - |  | -------- | ------ | - | ------------- | - | ------- | - |  | - | ------- | -
|                                                                         |  | Class A        |     |  | Additional |   |         |          |  | Accumulated |               |   |  |          | Total  |  
|                                                                         |  | Common         |     |  | Paid-In    |   |         | Retained |  |             | Comprehensive |   |  | Treasury |        |   | Stockholders |  
|                                                                         |  | Stock          |     |  | Capital    |   |         | Earnings |  |             | Income        |   |  | Stock    |        |   | Equity        |  
|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |  
|                                                                         |  | (In thousands) |    
|Balance at December 31, 2002                                             |  | $              | 186 |  |            | $ | 85,922  |          |  | $           | 27,253        |   |  | $        | (1,558 | ) |               | $ | (22,036 | ) |  | $ | 89,767  |  
|Net income                                                               |  |                |    |  |            |   |        |          |  |             | 16,984        |   |  |          |       |   |               |   |        |   |  |   | 16,984  |  
|Sale of Class A common stock                                             |  |                | 1   |  |            |   | 1,355   |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 1,356   |  
|Purchase of Class A treasury stock                                       |  |                |    |  |            |   |        |          |  |             |              |   |  |          |       |   |               |   | (2,278  | ) |  |   | (2,278  | )
|Stock issued under employee stock purchase plan                          |  |                |    |  |            |   | 616     |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 616     |  
|Foreign currency translation adjustment                                  |  |                |    |  |            |   |        |          |  |             |              |   |  |          | 2,645  |   |               |   |        |   |  |   | 2,645   |  
|Issuance of Class A common stock under dividend
    reinvestment program |  |                |    |  |            |   |        |          |  |             | (18           | ) |  |          |       |   |               |   | 23      |   |  |   | 5       |  
|Cash dividends                                                           |  |                |    |  |            |   |        |          |  |             | (2,758        | ) |  |          |       |   |               |   |        |   |  |   | (2,758  | )
|Issuance of Class A common restricted shares to employees                |  |                |    |  |            |   | 35      |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 35      |  
|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |  
|Balance at December 31, 2003                                             |  | $              | 187 |  |            | $ | 87,928  |          |  | $           | 41,461        |   |  | $        | 1,087  |   |               | $ | (24,291 | ) |  | $ | 106,372 |  
|Net income                                                               |  |                |    |  |            |   |        |          |  |             | 22,678        |   |  |          |       |   |               |   |        |   |  |   | 22,678  |  
|Sale of Class A common stock                                             |  |                | 3   |  |            |   | 3,672   |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 3,675   |  
|Purchase of Class A treasury stock                                       |  |                |    |  |            |   |         |          |  |             |              |   |  |          |       |   |               |   | (603    | ) |  |   | (603    | )
|Stock issued under employee stock purchase plan                          |  |                | 1   |  |            |   | 750     |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 751     |  
|Foreign currency translation adjustment                                  |  |                |    |  |            |   |        |          |  |             |              |   |  |          | 1,355  |   |               |   |        |   |  |   | 1,355   |  
|Issuance of Class A common stock under dividend
    reinvestment program |  |                |    |  |            |   |        |          |  |             | (19           | ) |  |          |       |   |               |   | 21      |   |  |   | 2       |  
|Cash dividends                                                           |  |                |    |  |            |   |        |          |  |             | (2,790        | ) |  |          |       |   |               |   |        |   |  |   | (2,790  | )
|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |  
|Balance at December 31, 2004                                             |  | $              | 191 |  |            | $ | 92,350  |          |  | $           | 61,330        |   |  | $        | 2,442  |   |               | $ | (24,873 | ) |  | $ | 131,440 |  
|Net income                                                               |  |                |    |  |            |   |        |          |  |             | 30,472        |   |  |          |       |   |               |   |        |   |  |   | 30,472  |  
|Sale of Class A common stock                                             |  |                | 1   |  |            |   | 2,963   |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 2,964   |  
|Tax benefit from stock options exercised                                 |  |                |    |  |            |   | 1,657   |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 1,657   |  
|Purchase of Class A treasury stock                                       |  |                |    |  |            |   |         |          |  |             |              |   |  |          |       |   |               |   | (3,115  | ) |  |   | (3,115  | )
|Stock issued under employee stock purchase plan                          |  |                | 1   |  |            |   | 1,319   |          |  |             |              |   |  |          |       |   |               |   |        |   |  |   | 1,320   |  
|Stock issued for acquisitions                                            |  |                | 32  |  |            |   | 70,488  |          |  |             |               |   |  |          |        |   |               |   |         |   |  |   | 70,520  |  
|Foreign currency translation adjustment                                  |  |                |    |  |            |   |        |          |  |             |              |   |  |          | (509   | ) |               |   |        |   |  |   | (509    | )
|Issuance of Class A common stock under dividend
    reinvestment program |  |                |    |  |            |   |        |          |  |             | (24           | ) |  |          |       |   |               |   | 25      |   |  |   | 1       |  
|Cash dividends                                                           |  |                |    |  |            |   |        |          |  |             | (3,354        | ) |  |          |       |   |               |   |        |   |  |   | (3,354  | )
|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |  
|Balance at December 31, 2005                                             |  | $              | 225 |  |            | $ | 168,777 |          |  | $           | 88,424        |   |  | $        | 1,933  |   |               | $ | (27,963 | ) |  | $ | 231,396 |  
|                                                                         |  |                |     |  |            |   |         |          |  |             |               |   |  |          |        |   |               |  



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Schawk, Inc.





Notes to Consolidated Financial Statements


(In Thousands, Except Per Share Amounts)




|        |                                                  
|------- | -------------------------------------------------
|NOTE 1. | Basis of Presentation and Description of Business





|        |                                           
|------- | ------------------------------------------
|NOTE 2. | Summary of Significant Accounting Policies



| |                            
| | ---------------------------
| | Principles of Consolidation





| |                 
| | ----------------
| | Cash Equivalents





| |                                                         
| | --------------------------------------------------------
| | Accounts Receivable and Concentration of Credit
    Risk





| |            
| | -----------
| | Inventories

Work-in




| |                       
| | ----------------------
| | Property and Equipment





| |         
| | --------
| | Goodwill



37



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




| |                  
| | -----------------
| | Long-lived Assets





| |                    
| | -------------------
| | Revenue Recognition





| |                 
| | ----------------
| | Customer Rebates





| |                                     
| | ------------------------------------
| | Shipping and Handling Fees and Costs

Net sales jobs-in Cost of sales




| |             
| | ------------
| | Income Taxes







38



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




| |                 
| | ----------------
| | Use of Estimates





| |                             
| | ----------------------------
| | Foreign Currency Translation





| |                                    
| | -----------------------------------
| | Fair Value of Financial Instruments





| |                     
| | --------------------
| | Comprehensive Income



|                                         |  |      |        |   |      |   |        |      |  |   |        | 
|---------------------------------------- |  | ---- | ------ | - | ---- | - | ------ | ---- |  | - | ------ | 
|                                         |  | 2005 |        |   | 2004 |   |        | 2003 | 
|                                         |  |      |        |   |      |   |        |      | 
|Net income                               |  | $    | 30,472 |   |      | $ | 22,678 |      |  | $ | 16,984 | 
|Foreign currency translation adjustments |  |      | (509   | ) |      |   | 1,355  |      |  |   | 2,645  | 
|                                         |  |      |        |   |      |   |        |      | 
|Comprehensive income                     |  | $    | 29,963 |   |      | $ | 24,033 |      |  | $ | 19,629 | 
|                                         |  |      |        |   |      |   |        |      | 

39



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




| |                         
| | ------------------------
| | Stock Based Compensation



|                                                                                                                                                  |         |                        |        |      |      |   |        |      |  |   |        |      | 
|------------------------------------------------------------------------------------------------------------------------------------------------- | ------- | ---------------------- | ------ | ---- | ---- | - | ------ | ---- |  | - | ------ | ---- | 
|                                                                                                                                                  |         | Year Ended December 31 |       
|                                                                                                                                                  |         |                        |       
|                                                                                                                                                  |         | 2005                   |        |      | 2004 |   |        | 2003 | 
|                                                                                                                                                  |         |                        |        |      |      |   |        |      | 
|Net income, as reported                                                                                                                           |         | $                      | 30,472 |      |      | $ | 22,678 |      |  | $ | 16,984 |     
|Less: Total stock-based employee compensation expense determined
    under fair value based method for all awards, net of related tax
    effects |         |                        | 1,503  |      |      |   | 1,064  |      |  |   | 719    |     
|                                                                                                                                                  |         |                        |        |      |      |   |        |      | 
|Net income, pro forma                                                                                                                             |         | $                      | 28,969 |      |      | $ | 21,614 |      |  | $ | 16,265 |     
|                                                                                                                                                  |         |                        |        |      |      |   |        |      | 
|Earnings per share                                                                                                                                |         |                        |        |      |      |   |        |      |  |   |        |     
|                                                                                                                                                  | Basic   |                        | $      | 1.19 |      |   | $      | 1.05 |  |   | $      | 0.79 | 
|                                                                                                                                                  | Diluted |                        | $      | 1.13 |      |   | $      | 1.01 |  |   | $      | 0.78 | 
|Pro forma earnings per share                                                                                                                      |         |                        |        |      |      |   |        |      |  |   |        |     
|                                                                                                                                                  | Basic   |                        | $      | 1.13 |      |   | $      | 1.00 |  |   | $      | 0.76 | 
|                                                                                                                                                  | Diluted |                        | $      | 1.07 |      |   | $      | 0.96 |  |   | $      | 0.74 | 



| |                  
| | -----------------
| | Reclassifications





| |                              
| | -----------------------------
| | New Accounting Pronouncements

Share-Based Payment Accounting for Stock-Based
Compensation, Accounting for Stock Issued to Employees.




40



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)








|        |             
|------- | ------------
|NOTE 3. | Acquisitions



| |                               
| | ------------------------------
| | Seven Worldwide Holdings, Inc.







41



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                                                      |  |   |         |  
|----------------------------------------------------- |  | - | ------- | -
|Trade accounts receivable                             |  | $ | 69,885  |  
|Inventory                                             |  |   | 20,004  |  
|Other current assets                                  |  |   | 5,899   |  
|Fixed assets                                          |  |   | 38,584  |  
|Intangible assets, principally customer relationships |  |   | 42,258  |  
|Goodwill                                              |  |   | 157,199 |  
|Other assets                                          |  |   | 908     |  
|Accounts payable                                      |  |   | (19,093 | )
|Other current liabilities                             |  |   | (71,441 | )
|Income taxes payable                                  |  |   | (10,947 | )
|Deferred income taxes                                 |  |   | (5,880  | )
|Long term debt and capital lease obligations          |  |   | (50     | )
|Other liabilities                                     |  |   | (22,918 | )
|                                                      |  |   |        
|Total purchase price, net of $6,160 cash received     |  | $ | 204,408 |  
|                                                      |  |   |        







|                      |  |             |        |  |             |   |       |          |              |   |        |   |  |   |        | 
|--------------------- |  | ----------- | ------ |  | ----------- | - | ----- | -------- | ------------ | - | ------ | - |  | - | ------ | 
|                      |  | Balance     |        |  |             |   |       |          | Balance      |  
|                      |  | January 31, |        |  |             |   |       |          | December 31, |  
|                      |  | 2005        |        |  | Adjustments |   |       | Payments |              |   | 2005   |  
|                      |  |             |        |  |             |   |       |          |              |   |        |  
|Employee severance    |  | $           | 7,075  |  |             | $ | 5,092 |          |              | $ | (6,721 | ) |  | $ | 5,446  | 
|Facility closure cost |  |             | 4,715  |  |             |   | 3,969 |          |              |   | (1,114 | ) |  |   | 7,570  | 
|                      |  |             |        |  |             |   |       |          |              |   |        |  
|Total                 |  | $           | 11,790 |  |             | $ | 9,061 |          |              | $ | (7,835 | ) |  | $ | 13,016 | 
|                      |  |             |        |  |             |   |       |          |              |   |        |  



42



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                                                             |  |                   |         |  |                   |   |         | 
|------------------------------------------------------------ |  | ----------------- | ------- |  | ----------------- | - | ------- | 
|                                                             |  | Year Ended        |         |  | Year Ended        |  
|Pro forma, unaudited, in thousands, except per share amounts |  | December 31, 2005 |         |  | December 31, 2004 |  
|                                                             |  |                   |         |  |                   |  
|Total revenue                                                |  | $                 | 638,713 |  |                   | $ | 608,289 | 
|Net income                                                   |  |                   | 28,007  |  |                   |   | 20,619  | 
|Diluted earnings per share                                   |  | $                 | 1.04    |  |                   | $ | 0.76    | 



| |                      
| | ---------------------
| | Weir Holdings Limited





43



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                                       |  |   |        |  
|-------------------------------------- |  | - | ------ | -
|Trade accounts receivable              |  | $ | 7,071  |  
|Inventory                              |  |   | 1,267  |  
|Other current assets                   |  |   | 651    |  
|Deferred income tax asset              |  |   | 985    |  
|Fixed assets                           |  |   | 6,566  |  
|Customer relationship intangible asset |  |   | 8,201  |  
|Goodwill                               |  |   | 9,630  |  
|Other assets                           |  |   | 307    |  
|Current liabilities                    |  |   | (7,593 | )
|Capital leases                         |  |   | (464   | )
|Facility exit reserve                  |  |   | (3,283 | )
|                                       |  |   |       
|Net cash consideration                 |  | $ | 23,338 |  
|                                       |  |   |       







|                      |  |              |       |  |             |   |     |          |              |   |        |   |  |   |       | 
|--------------------- |  | ------------ | ----- |  | ----------- | - | --- | -------- | ------------ | - | ------ | - |  | - | ----- | 
|                      |  | Balance      |       |  |             |   |     |          | Balance      |  
|                      |  | December 31, |       |  |             |   |     |          | December 31, |  
|                      |  | 2004         |       |  | Adjustments |   |     | Payments |              |   | 2005   |  
|                      |  |              |       |  |             |   |     |          |              |   |        |  
|Employee severance    |  | $            | 1,254 |  |             | $ | 65  |          |              | $ | (902   | ) |  | $ | 417   | 
|Facility closure cost |  |              | 1,246 |  |             |   | 718 |          |              |   | (632   | ) |  |   | 1,332 | 
|                      |  |              |       |  |             |   |     |          |              |   |        |  
|Total                 |  | $            | 2,500 |  |             | $ | 783 |          |              | $ | (1,534 | ) |  | $ | 1,749 | 
|                      |  |              |       |  |             |   |     |          |              |   |        |  



44



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)






| |                   
| | ------------------
| | Other acquisitions





|                                       |  |   |       |  
|-------------------------------------- |  | - | ----- | -
|Inventory                              |  | $ | 683   |  
|Machinery and equipment                |  |   | 150   |  
|Employee liabilities assumed           |  |   | (121  | )
|Customer relationship intangible asset |  |   | 2,300 |  
|Non-compete intangible asset           |  |   | 100   |  
|Goodwill                               |  |   | 1,817 |  
|                                       |  |   |      
|Net cash consideration                 |  | $ | 4,929 |  









|        |                           
|------- | --------------------------
|NOTE 4. | Related Party Transactions





45



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)






|        |            
|------- | -----------
|NOTE 5. | Inventories



|                   |  |              |        |   |      |   |        |  
|------------------ |  | ------------ | ------ | - | ---- | - | ------ | -
|                   |  | December 31, |       
|                   |  |              |       
|                   |  | 2005         |        |   | 2004 |  
|                   |  |              |        |   |      |  
|Raw materials      |  | $            | 4,728  |   |      | $ | 3,768  |  
|Work in process    |  |              | 25,653 |   |      |   | 7,653  |  
|                   |  |              |        |   |      |  
|                   |  |              | 30,381 |   |      |   | 11,421 |  
|Less: LIFO reserve |  |              | (1,058 | ) |      |   | (1,082 | )
|                   |  |              |        |   |      |  
|                   |  | $            | 29,323 |   |      | $ | 10,339 |  
|                   |  |              |        |   |      |  



|        |                       
|------- | ----------------------
|NOTE 6. | Property and Equipment



|                                          |  |              |         |   |      |   |         |  
|----------------------------------------- |  | ------------ | ------- | - | ---- | - | ------- | -
|                                          |  | December 31, |        
|                                          |  |              |        
|                                          |  | 2005         |         |   | 2004 |  
|                                          |  |              |         |   |      |  
|Land and improvements                     |  | $            | 11,146  |   |      | $ | 725     |  
|Buildings and improvements                |  |              | 21,594  |   |      |   | 14,815  |  
|Machinery and equipment                   |  |              | 84,197  |   |      |   | 71,112  |  
|Leasehold improvements                    |  |              | 17,372  |   |      |   | 15,716  |  
|Computer software                         |  |              | 20,193  |   |      |   | 13,731  |  
|                                          |  |              |         |   |      |  
|                                          |  |              | 154,502 |   |      |   | 116,099 |  
|Accumulated depreciation and amortization |  |              | (75,644 | ) |      |   | (69,668 | )
|                                          |  |              |         |   |      |  
|                                          |  | $            | 78,858  |   |      | $ | 46,431  |  
|                                          |  |              |         |   |      |  



|        |                               
|------- | ------------------------------
|NOTE 7. | Goodwill and Intangible Assets



|                             |  |   |         | 
|---------------------------- |  | - | ------- | 
|Balance at December 31, 2003 |  | $ | 62,936  | 
|Acquisitions                 |  |   | 8,432   | 
|Foreign currency translation |  |   | 352     | 
|                             |  |   |        
|Balance at December 31, 2004 |  |   | 71,720  | 
|Acquisitions                 |  |   | 161,934 | 
|Foreign currency translation |  |   | 184     | 
|                             |  |   |        
|Balance at December 31, 2005 |  | $ | 233,838 | 
|                             |  |   |        



46



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                         |  |              |        |   |      |   |        |  
|------------------------ |  | ------------ | ------ | - | ---- | - | ------ | -
|                         |  | December 31, |       
|                         |  |              |       
|                         |  | 2005         |        |   | 2004 |  
|                         |  |              |        |   |      |  
|Customer relationships   |  | $            | 53,490 |   |      | $ | 12,632 |  
|Digital images           |  |              | 882    |   |      |   |       |  
|Developed technologies   |  |              | 762    |   |      |   |       |  
|Non-compete agreements   |  |              | 681    |   |      |   | 681    |  
|Patents                  |  |              | 325    |   |      |   | 311    |  
|Trade names              |  |              | 157    |   |      |   |       |  
|                         |  |              |        |   |      |  
|                         |  |              | 56,297 |   |      |   | 13,624 |  
|Accumulated amortization |  |              | (5,313 | ) |      |   | (870   | )
|                         |  |              |        |   |      |  
|                         |  | $            | 50,984 |   |      | $ | 12,754 |  
|                         |  |              |        |   |      |  





|        |                 
|------- | ----------------
|NOTE 8. | Accrued Expenses



|                                       |  |              |        |  |      |   |        | 
|-------------------------------------- |  | ------------ | ------ |  | ---- | - | ------ | 
|                                       |  | December 31, |       
|                                       |  |              |       
|                                       |  | 2005         |        |  | 2004 |  
|                                       |  |              |        |  |      |  
|Accrued compensation and payroll taxes |  | $            | 30,360 |  |      | $ | 13,102 | 
|Facility exit reserve                  |  |              | 8,825  |  |      |   | 2,514  | 
|Vacant property reserve                |  |              | 5,274  |  |      |   |       | 
|Unearned revenue                       |  |              | 3,199  |  |      |   |       | 
|Accrued customer rebates               |  |              | 2,830  |  |      |   | 1,059  | 
|Accrued property taxes                 |  |              | 2,694  |  |      |   | 518    | 
|Accrued professional fees              |  |              | 2,449  |  |      |   | 2,765  | 
|Accrued interest                       |  |              | 870    |  |      |   | 178    | 
|Other                                  |  |              | 12,948 |  |      |   | 6,442  | 
|                                       |  |              |        |  |      |  
|                                       |  | $            | 69,499 |  |      | $ | 26,578 | 
|                                       |  |              |        |  |      |  

47



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|        |                            
|------- | ---------------------------
|NOTE 9. | Other Long-Term Liabilities



|                        |  |              |        |  |      |   |     | 
|----------------------- |  | ------------ | ------ |  | ---- | - | --- | 
|                        |  | December 31, |       
|                        |  |              |       
|                        |  | 2005         |        |  | 2004 |  
|                        |  |              |        |  |      |  
|Vacant property reserve |  | $            | 16,552 |  |      | $ |    | 
|Facility exit reserve   |  |              | 5,940  |  |      |   |    | 
|Other                   |  |              | 4,891  |  |      | $ | 979 | 
|                        |  |              |        |  |      |  
|                        |  | $            | 27,383 |  |      | $ | 979 | 
|                        |  |              |        |  |      |  



|         |     
|-------- | ----
|NOTE 10. | Debt



|                                         |  |              |         |   |      |   |        |  
|---------------------------------------- |  | ------------ | ------- | - | ---- | - | ------ | -
|                                         |  | December 31, |        
|                                         |  |              |        
|                                         |  | 2005         |         |   | 2004 |  
|                                         |  |              |         |   |      |  
|U.S. bank revolving credit agreement     |  | $            | 94,520  |   |      | $ | 14,500 |  
|Series A senior note payable  Tranche A |  |              | 15,000  |   |      |   | 15,000 |  
|Series A senior note payable  Tranche B |  |              | 10,000  |   |      |   | 10,000 |  
|Series B senior note payable             |  |              |        |   |      |   | 6,000  |  
|Series C senior note payable             |  |              | 10,000  |   |      |   |       |  
|Series D senior note payable             |  |              | 20,000  |   |      |   |       |  
|Series E senior note payable             |  |              | 20,000  |   |      |   |       |  
|Other                                    |  |              | 13      |   |      |   |       |  
|                                         |  |              |         |   |      |  
|                                         |  |              | 169,533 |   |      |   | 45,500 |  
|Less amounts due in one year or less     |  |              | (5      | ) |      |   | (6,000 | )
|                                         |  |              |         |   |      |  
|                                         |  | $            | 169,528 |   |      | $ | 39,500 |  
|                                         |  |              |         |   |      |  







48



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|           |  |   |         | 
|---------- |  | - | ------- | 
|2006       |  | $ | 5       | 
|2007       |  |   | 2,151   | 
|2008       |  |   | 3,571   | 
|2009       |  |   | 3,571   | 
|2010       |  |   | 108,091 | 
|Thereafter |  |   | 52,144  | 
|           |  |   |        
|           |  | $ | 169,533 | 
|           |  |   |        



|         |                     
|-------- | --------------------
|NOTE 11. | Stockholders Equity



|                                                                                                                                                                                                                                                              |                                                                                                        |              |     |        |      |   |     |        | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------ | ------------ | --- | ------ | ---- | - | --- | ------ | 
|                                                                                                                                                                                                                                                              |                                                                                                        | December 31, |    
|                                                                                                                                                                                                                                                              |                                                                                                        |              |    
|                                                                                                                                                                                                                                                              |                                                                                                        | 2005         |     |        | 2004 |  
|                                                                                                                                                                                                                                                              |                                                                                                        |              |     |        |      |  
|Common stock:                                                                                                                                                                                                                                                 |                                                                                                        |              |     |        |      |   |     |       
|Class A voting, $0.008 par value,
    40,000,000 shares authorized; 28,441,689 and
    24,025,915 shares issued at December 31, 2005 and
    2004, respectively; 26,070,747 and 21,816,879 shares
    outstanding at December 31, 2005 and 2004, respectively |                                                                                                        | $            | 225 |        |      | $ | 191 |       
|                                                                                                                                                                                                                                                              |                                                                                                        |              |     |        |      |  
|Treasury stock:                                                                                                                                                                                                                                               |                                                                                                        |              |     |        |      |   |     |       
|                                                                                                                                                                                                                                                              | 2,370,942 and 2,209,036 shares of Class A common stock
    at December 31, 2005 and 2004, respectively |              | $   | 27,963 |      |   | $   | 24,873 | 
|                                                                                                                                                                                                                                                              |                                                                                                        |              |     |        |      |  



|         |             
|-------- | ------------
|NOTE 12. | Income Taxes



|          |         |                          |        |        |      |  |        |        |   |  |        |        |  
|--------- | ------- | ------------------------ | ------ | ------ | ---- |  | ------ | ------ | - |  | ------ | ------ | -
|          |         | Years Ended December 31, |       
|          |         |                          |       
|          |         | 2005                     |        |        | 2004 |  |        | 2003   |  
|          |         |                          |        |        |      |  |        |        |  
|Current:  |         |                          |        |        |      |  |        |        |   |  |        |       
|          | Federal |                          | $      | 6,443  |      |  | $      | 11,205 |   |  | $      | 9,088  |  
|          | State   |                          |        | 2,781  |      |  |        | 186    |   |  |        | 1,057  |  
|          | Foreign |                          |        | 6,264  |      |  |        | 1,162  |   |  |        | 1,052  |  
|          |         |                          |        |        |      |  |        |        |  
|          |         |                          | 15,488 |        |      |  | 12,553 |        |   |  | 11,197 |       
|Deferred: |         |                          |        |        |      |  |        |        |   |  |        |       
|          | Federal |                          |        | 6,192  |      |  |        | 663    |   |  |        | (487   | )
|          | State   |                          |        | 83     |      |  |        | 298    |   |  |        | (57    | )
|          | Foreign |                          |        | (3,514 | )    |  |        | (172   | ) |  |        | (373   | )
|          |         |                          |        |        |      |  |        |        |  
|          |         |                          | 2,761  |        |      |  | 789    |        |   |  | (917   | )     
|          |         |                          |        |        |      |  |        |        |  
|          | Total   |                          | $      | 18,249 |      |  | $      | 13,342 |   |  | $      | 10,280 |  
|          |         |                          |        |        |      |  |        |        |  

49



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##### Table of Contents



Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                                 |                                                        |              |         |         |      |   |        |        |  
|-------------------------------- | ------------------------------------------------------ | ------------ | ------- | ------- | ---- | - | ------ | ------ | -
|                                 |                                                        | December 31, |        
|                                 |                                                        |              |        
|                                 |                                                        | 2005         |         |         | 2004 |  
|                                 |                                                        |              |         |         |      |  
|Deferred Income Tax Assets:      |                                                        |              |         |         |      |   |        |       
|                                 | Inventory                                              |              | $       | 44      |      |   | $      | 40     |  
|                                 | Accruals and reserves not currently deductible         |              |         | 5,170   |      |   |        | 1,367  |  
|                                 | Bad debt reserve                                       |              |         | 2,166   |      |   |        |       |  
|                                 | Accrued vacation                                       |              |         | 2,189   |      |   |        |       |  
|                                 | Other                                                  |              |         | 715     |      |   |        | 946    |  
|                                 | Restructuring reserves                                 |              |         | 6,078   |      |   |        |       |  
|                                 | Net Operating Losses                                   |              |         | 7,407   |      |   |        |       |  
|                                 | Income Tax Credits                                     |              |         | 3,862   |      |   |        |       |  
|                                 | Capital Losses                                         |              |         | 13,258  |      |   |        |       |  
|                                 |                                                        |              |         |         |      |  
|                                 | Deferred Income Tax Assets Before Valuation Allowances |              |         | 40,889  |      |   |        |       |  
|                                 | Valuation Allowances                                   |              |         | (20,116 | )    |   |        |       |  
|                                 |                                                        |              |         |         |      |  
|Net Deferred Income Tax Assets   |                                                        | $            | 20,773  |         |      | $ | 2,353  |       
|                                 |                                                        |              |         |         |      |  
|Deferred Income Tax Liabilities: |                                                        |              |         |         |      |   |        |       
|                                 | Prepaid Expenses                                       |              | $       | (372    | )    |   |        |       |  
|                                 | Property and equipment                                 |              |         | (5,826  | )    |   | $      | (3,282 | )
|                                 | Customer Intangibles                                   |              |         | (16,420 | )    |   |        | (1,218 | )
|                                 | Domestic Subsidiary Stock                              |              |         | (9,536  | )    |   |        |        |  
|                                 | Goodwill on Asset Acquisitions                         |              |         | (1,046  | )    |   |        |       |  
|                                 | Other                                                  |              |         | (3,416  | )    |   |        | (2,195 | )
|                                 |                                                        |              |         |         |      |  
|Deferred Income Tax Liabilities  |                                                        | $            | (36,616 | )       |      | $ | (6,695 | )     
|                                 |                                                        |              |         |         |      |  



|                                          |  |              |      |   |      |  |      |      |  |  |      |  
|----------------------------------------- |  | ------------ | ---- | - | ---- |  | ---- | ---- |  |  | ---- | -
|                                          |  | Year Ended   |     
|                                          |  | December 31, |     
|                                          |  |              |     
|                                          |  | 2005         |      |   | 2004 |  |      | 2003 | 
|                                          |  |              |      |   |      |  |      |      | 
|Income taxes at statutory rate            |  |              | 35.0 | % |      |  | 35.0 | %    |  |  | 35.0 | %
|Nondeductible expenses                    |  |              | 1.1  |   |      |  | .2   |      |  |  | (.1  | )
|State income taxes                        |  |              | 3.2  |   |      |  | 3.0  |      |  |  | 1.9  |  
|Foreign rate differential                 |  |              | (0.9 | ) |      |  | 1.2  |      |  |  | .9   |  
|Reduction of accrual for prior year taxes |  |              | (2.1 | ) |      |  |     |      |  |  |     |  
|Other                                     |  |              | 1.2  |   |      |  |     |      |  |  |     |  
|Prior year state refunds received         |  |              |     |   |      |  | (2.4 | )    |  |  |     |  
|                                          |  |              |      |   |      |  |      |      | 
|                                          |  |              | 37.5 | % |      |  | 37.0 | %    |  |  | 37.7 | %
|                                          |  |              |      |   |      |  |      |      | 

50



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|         |  |      |        |  |      |   |        |      |  |   |        | 
|-------- |  | ---- | ------ |  | ---- | - | ------ | ---- |  | - | ------ | 
|         |  | 2005 |        |  | 2004 |   |        | 2003 | 
|         |  |      |        |  |      |   |        |      | 
|Domestic |  | $    | 41,688 |  |      | $ | 32,923 |      |  | $ | 25,404 | 
|Foreign  |  | $    | 7,032  |  |      | $ | 3,097  |      |  |   | 1,860  | 
|         |  |      |        |  |      |   |        |      | 
|Total    |  | $    | 48,720 |  |      | $ | 36,020 |      |  | $ | 27,264 | 







|         |                       
|-------- | ----------------------
|NOTE 13. | Leases and Commitments







|                                    |  |         |     |  |           |   |        | 
|----------------------------------- |  | ------- | --- |  | --------- | - | ------ | 
|                                    |  | Capital |     |  | Operating |  
|                                    |  | Leases  |     |  | Leases    |  
|                                    |  |         |     |  |           |  
|2006                                |  | $       | 471 |  |           |   | 19,697 | 
|2007                                |  |         | 52  |  |           |   | 14,587 | 
|2008                                |  |         |    |  |           |   | 11,675 | 
|2009                                |  |         |    |  |           |   | 9,773  | 
|2010                                |  |         |    |  |           |   | 8,246  | 
|Thereafter                          |  |         |    |  |           |   | 23,987 | 
|                                    |  |         |     |  |           |  
|                                    |  | $       | 523 |  |           | $ | 87,965 | 
|                                    |  |         |     |  |           |  
|Less: Amounts representing interest |  |         | 23  |  |           |   |        | 
|                                    |  |         |     |  |           |  
|                                    |  |         | 500 |  |           |   |        | 
|Less: Current portion               |  |         | 449 |  |           |   |        | 
|                                    |  |         |     |  |           |  
|                                    |  | $       | 51  |  |           |   |        | 
|                                    |  |         |     |  |           |  



51



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)






|         |                       
|-------- | ----------------------
|NOTE 14. | Employee Benefit Plans





beginning-of end-of






|         |                           
|-------- | --------------------------
|NOTE 15. | Stock/ Equity Option Plans



52



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                           |  |                    |       |   |                  |   |       | 
|-------------------------- |  | ------------------ | ----- | - | ---------------- | - | ----- | 
|                           |  | Outstanding        |       |   |                 
|                           |  | Options of Class A |       |   | Weighted Average |  
|                           |  | Common Stock       |       |   | Exercise Price   |  
|                           |  |                    |       |   |                  |  
|Balance, December 31, 2002 |  |                    | 2,542 |   |                  | $ | 9.48  | 
|Granted                    |  |                    | 530   |   |                  |   | 9.31  | 
|Exercised                  |  |                    | (177  | ) |                  |   | 8.77  | 
|                           |  |                    |       |   |                  |  
|Balance, December 31, 2003 |  |                    | 2,895 |   |                  |   | 9.49  | 
|                           |  |                    |       |   |                  |  
|Granted                    |  |                    | 576   |   |                  |   | 14.21 | 
|Exercised                  |  |                    | (360  | ) |                  |   | 10.20 | 
|Cancelled                  |  |                    | (28   | ) |                  |   | 9.47  | 
|                           |  |                    |       |   |                  |  
|Balance December 31, 2004  |  |                    | 3,083 |   |                  |   | 10.29 | 
|Granted                    |  |                    | 574   |   |                  |   | 18.79 | 
|Exercised                  |  |                    | (324  | ) |                  |   | 9.54  | 
|Cancelled                  |  |                    |      |   |                  |   |      | 
|                           |  |                    |       |   |                  |  
|Balance December 31, 2005  |  |                    | 3,333 |   |                  | $ | 11.73 | 
|                           |  |                    |       |   |                  |  



|                        |  |                     |       |                  |                     |  |          |                |  |   |             |            |  |             |       |  |  |   |       | 
|----------------------- |  | ------------------- | ----- | ---------------- | ------------------- |  | -------- | -------------- |  | - | ----------- | ---------- |  | ----------- | ----- |  |  | - | ----- | 
|                        |  | Options Outstanding |       |                  | Options Exercisable | 
|                        |  |                     |       |                  |                     | 
|                        |  |                     |       | Weighted Average |                     |  |          |                |  |   | Weighted    |           
|                        |  |                     |       | Remaining        |                     |  | Weighted |                |  |   |             | Average of | 
|                        |  | Number              |       |                  | Contractual Life    |  |          | Average        |  |   | Number      |            |  | Exercisable |      
|Range of Exercise Price |  | Outstanding         |       |                  | (Years)             |  |          | Exercise Price |  |   | Exercisable |            |  | Price       |      
|                        |  |                     |       |                  |                     |  |          |                |  |   |             |            |  |             |      
|$ 6.20 - $ 8.26         |  |                     | 410   |                  |                     |  | 2.5      |                |  | $ | 7.76        |            |  |             | 410   |  |  | $ | 7.76  | 
|8.26 -  10.33           |  |                     | 1,550 |                  |                     |  | 5.6      |                |  |   | 9.29        |            |  |             | 1,550 |  |  |   | 9.29  | 
|10.33 -  12.39          |  |                     | 199   |                  |                     |  | 3.2      |                |  |   | 11.30       |            |  |             | 199   |  |  |   | 11.30 | 
|12.39 -  14.45          |  |                     | 554   |                  |                     |  | 8.2      |                |  |   | 14.20       |            |  |             | 358   |  |  |   | 14.20 | 
|14.45 -  16.52          |  |                     | 68    |                  |                     |  | 2.7      |                |  |   | 14.92       |            |  |             | 68    |  |  |   | 14.92 | 
|16.52 -  18.58          |  |                     | 5     |                  |                     |  | 9.1      |                |  |   | 18.18       |            |  |             | 2     |  |  |   | 18.18 | 
|18.58 -  20.65          |  |                     | 547   |                  |                     |  | 9.3      |                |  |   | 18.80       |            |  |             | 177   |  |  |   | 18.80 | 
|                        |  |                     |       |                  |                     |  |          |                |  |   |             |            |  |             |      
|                        |  |                     | 3,333 |                  |                     |  |          |                |  |   |             |            |  |             | 2,764 |  |  |   |       | 
|                        |  |                     |       |                  |                     |  |          |                |  |   |             |            |  |             |      





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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|                                          |  |      |         |   |      |  |         |      |  |  |         |  
|----------------------------------------- |  | ---- | ------- | - | ---- |  | ------- | ---- |  |  | ------- | -
|                                          |  | 2005 |         |   | 2004 |  |         | 2003 | 
|                                          |  |      |         |   |      |  |         |      | 
|Expected dividend yield                   |  |      | 0.70    | % |      |  | 0.90    | %    |  |  | 1.30    | %
|Expected stock price volatility           |  |      | 19.80   | % |      |  | 16.60   | %    |  |  | 16.40   | %
|Risk-free interest rate range             |  |      | 4.0     | % |      |  | 4.0     | %    |  |  | 4.0     | %
|Weighted-average expected life of options |  |      | 7 years |   |      |  | 7 years |      |  |  | 7 years |  





|         |                   
|-------- | ------------------
|NOTE 16. | Earnings Per Share





|                                                         |  |      |        |  |      |   |        |      |  |   |        | 
|-------------------------------------------------------- |  | ---- | ------ |  | ---- | - | ------ | ---- |  | - | ------ | 
|                                                         |  | 2005 |        |  | 2004 |   |        | 2003 | 
|                                                         |  |      |        |  |      |   |        |      | 
|Net Income                                               |  | $    | 30,472 |  |      | $ | 22,678 |      |  | $ | 16,984 | 
|                                                         |  |      |        |  |      |   |        |      | 
|Weighted average shares                                  |  |      | 25,529 |  |      |   | 21,603 |      |  |   | 21,379 | 
|Effect of dilutive employee stock options                |  |      | 1,434  |  |      |   | 912    |      |  |   | 460    | 
|                                                         |  |      |        |  |      |   |        |      | 
|Adjusted weighted average shares and assumed conversions |  |      | 26,963 |  |      |   | 22,515 |      |  |   | 21,839 | 
|                                                         |  |      |        |  |      |   |        |      | 
|Basic earnings per share                                 |  | $    | 1.19   |  |      | $ | 1.05   |      |  | $ | 0.79   | 
|Diluted earnings per share                               |  | $    | 1.13   |  |      | $ | 1.01   |      |  | $ | 0.78   | 







54



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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|         |                     
|-------- | --------------------
|NOTE 17. | Geographic Reporting



|                  |  |               |         |  |        |   |        |        |  |   |         |  |  |       |        |   |  |   |         | 
|----------------- |  | ------------- | ------- |  | ------ | - | ------ | ------ |  | - | ------- |  |  | ----- | ------ | - |  | - | ------- | 
|                  |  |               |         |  |        |   |        | Other  |  |   |        
|                  |  | United States |         |  | Canada |   |        | Europe |  |   | Foreign |  |  | Total |       
|                  |  |               |         |  |        |   |        |        |  |   |         |  |  |       |       
|2005              |  |               |         |  |        |   |        |        |  |   |         |  |  |       |        |   |  |   |         | 
|Sales             |  | $             | 473,918 |  |        | $ | 35,849 |        |  | $ | 82,021  |  |  | $     | 22,732 |   |  | $ | 614,520 | 
|Long-lived assets |  |               | 300,282 |  |        |   | 18,917 |        |  |   | 44,820  |  |  |       | 6,231  |   |  |   | 370,250 | 
|Net assets        |  |               | 211,433 |  |        |   | 16,594 |        |  |   | 10,995  |  |  |       | (7,626 | ) |  |   | 231,396 | 
|2004              |  |               |         |  |        |   |        |        |  |   |         |  |  |       |        |   |  |   |         | 
|Sales             |  | $             | 190,983 |  |        | $ | 33,398 |        |  |   |        |  |  | $     | 13,964 |   |  | $ | 238,345 | 
|Long-lived assets |  |               | 87,863  |  |        |   | 19,196 |        |  | $ | 23,734  |  |  |       | 7,144  |   |  |   | 137,937 | 
|Net assets        |  |               | 121,329 |  |        |   | 12,479 |        |  |   |        |  |  |       | (2,368 | ) |  |   | 131,440 | 
|2003              |  |               |         |  |        |   |        |        |  |   |         |  |  |       |        |   |  |   |         | 
|Sales             |  | $             | 159,861 |  |        | $ | 30,648 |        |  |   |        |  |  | $     | 10,522 |   |  | $ | 201,031 | 
|Long-lived assets |  |               | 78,807  |  |        |   | 16,999 |        |  |   |        |  |  |       | 7,739  |   |  |   | 103,545 | 
|Net assets        |  |               | 98,588  |  |        |   | 10,192 |        |  |   |        |  |  |       | (2,408 | ) |  |   | 106,372 | 





|         |             
|-------- | ------------
|NOTE 18. | Other Income







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Schawk, Inc.


Notes to Consolidated Financial
Statements  (Continued)




|         |                                     
|-------- | ------------------------------------
|NOTE 19. | Quarterly Financial Data (unaudited)



|                   |         |                                          |        |      |          |   |        |          |  |   |         |      |  |           |        |      |          |   |         |          |  |   |         |      |  |   |         |      |  |   |         |      | 
|------------------ | ------- | ---------------------------------------- | ------ | ---- | -------- | - | ------ | -------- |  | - | ------- | ---- |  | --------- | ------ | ---- | -------- | - | ------- | -------- |  | - | ------- | ---- |  | - | ------- | ---- |  | - | ------- | ---- | 
|                   |         | March 31,                                |        |      | June 30, |   |        | Sept 30, |  |   | Dec 31, |      |  | March 31, |        |      | June 30, |   |         | Sept 30, |  |   | Dec 31, |     
|                   |         | 2004                                     |        |      | 2004     |   |        | 2004     |  |   | 2004    |      |  | 2005      |        |      | 2005     |   |         | 2005     |  |   | 2005    |     
|                   |         |                                          |        |      |          |   |        |          |  |   |         |      |  |           |        |      |          |   |         |          |  |   |         |     
|                   |         | (In thousands, except per share amounts) |       
|Net sales          |         | $                                        | 52,077 |      |          | $ | 64,456 |          |  | $ | 62,245  |      |  | $         | 59,567 |      |          | $ | 130,751 |          |  | $ | 158,648 |      |  | $ | 165,343 |      |  | $ | 159,778 |     
|Cost of sales      |         |                                          | 31,310 |      |          |   | 37,025 |          |  |   | 34,027  |      |  |           | 34,655 |      |          |   | 86,197  |          |  |   | 103,666 |      |  |   | 107,388 |      |  |   | 105,813 |     
|                   |         |                                          |        |      |          |   |        |          |  |   |         |      |  |           |        |      |          |   |         |          |  |   |         |     
|Gross Profit       |         |                                          | 20,767 |      |          |   | 27,431 |          |  |   | 28,218  |      |  |           | 24,912 |      |          |   | 44,554  |          |  |   | 54,982  |      |  |   | 57,955  |      |  |   | 53,965  |     
|Net income         |         | $                                        | 3,627  |      |          | $ | 6,621  |          |  | $ | 7,317   |      |  | $         | 5,113  |      |          | $ | 5,564   |          |  | $ | 7,852   |      |  | $ | 8,760   |      |  | $ | 8,296   |     
|                   |         |                                          |        |      |          |   |        |          |  |   |         |      |  |           |        |      |          |   |         |          |  |   |         |     
|Earnings per share |         |                                          |        |      |          |   |        |          |  |   |         |      |  |           |        |      |          |   |         |          |  |   |         |      |  |   |         |      |  |   |         |     
|                   | Basic   |                                          | $      | 0.17 |          |   | $      | 0.31     |  |   | $       | 0.34 |  |           | $      | 0.23 |          |   | $       | 0.23     |  |   | $       | 0.31 |  |   | $       | 0.34 |  |   | $       | 0.32 | 
|                   | Diluted |                                          |        | 0.16 |          |   |        | 0.30     |  |   |         | 0.33 |  |           |        | 0.22 |          |   |         | 0.22     |  |   |         | 0.29 |  |   |         | 0.32 |  |   |         | 0.30 | 



|         |                  
|-------- | -----------------
|NOTE 20. | Subsequent Events

30-day




56



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|        |                                                                                           
|------- | ------------------------------------------------------------------------------------------
|ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
    ACCOUNTING AND FINANCIAL DISCLOSURES.








|         |                         
|-------- | ------------------------
|ITEM 9A. | CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures


13a-15(e) 15d-15(e) 10-K. 10-K


Managements Report on Internal Control over Financial
Reporting


Company 13a-15(f) (Internal Control) (GAAP)








57



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10-K.


|                                                         |  |                                                                            
|-------------------------------------------------------- |  | ---------------------------------------------------------------------------
|/s/ David A. SchawkPresident and Chief Executive Officer |  | /s/ James J. PattersonSenior Vice President and Chief Financial
    Officer

Changes in Internal Control over Financial Reporting








Inherent Limitations on the Effectiveness of Controls






58



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Report of Independent Registered Public Accounting Firm


On Internal Control over Financial Reporting
















59



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| |                  
| | -----------------
| | Ernst & Young LLP





60



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|         |                   
|-------- | ------------------
|ITEM 9b. | OTHER INFORMATION.






PART III







|         |                                                    
|-------- | ---------------------------------------------------
|ITEM 10. | DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.








|         |                        
|-------- | -----------------------
|ITEM 11. | EXECUTIVE COMPENSATION.








|         |                                                                                                   
|-------- | --------------------------------------------------------------------------------------------------
|ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
    MANAGEMENT AND RELATED STOCKHOLDER MATTERS

10-K.







|         |                                                
|-------- | -----------------------------------------------
|ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.








|         |                                        
|-------- | ---------------------------------------
|ITEM 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES.






PART IV







|         |                                            
|-------- | -------------------------------------------
|ITEM 15. | EXHIBITS, AND FINANCIAL STATEMENT SCHEDULES

8-Financial




| |                                                                                                    
| | ---------------------------------------------------------------------------------------------------
| | Report of Independent Registered Public Accounting Firm                                            
|
| | Consolidated Balance Sheets  Years Ended
    December 31, 2005 and 2004                           
|
| | Consolidated Statements of Operations  Years Ended
    December 31, 2005, 2004, and 2003          
|
| | Consolidated Statements of Cash Flows  Years Ended
    December 31, 2005, 2004, and 2003          
|
| | Consolidated Statements of Stockholders Equity 
    Years Ended December 31, 2005, 2004, and 2003
|
| | Notes to Consolidated Financial Statements 
    December 31, 2005                                 

61



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| |                                                 
| | ------------------------------------------------
| | Schedule II  Valuation and qualifying accounts.



| |    |      |  |                                                                                                                                                                 |  |                                                                                                       
| | -- | ---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------
| |    |      |  | Incorporated Herein                                                                                                                                            
| |    |      |  | by Reference to                                                                                                                                                
| |    |      |  |                                                                                                                                                                
| | 3  | .1   |  | Certificate of Incorporation of Schawk, Inc., as amended.                                                                                                       |  | Registration Statement No. 333-39113                                                                  
|
| | 3  | .3   |  | By-Laws of Schawk, Inc., as amended.                                                                                                                            |  | Registration Statement No. 333-39113                                                                  
|
| | 4  | .1   |  | Specimen Class A Common Stock Certificate.                                                                                                                      |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .22  |  | Lease Agreement dated as of July 1, 1987, and between
    Process Color Plate, a division of Schawk, Inc. and The Clarence
    W. Schawk 1979 Childrens Trust. |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .23  |  | Lease Agreement dated as of June 1, 1989, by and between
    Schawk Graphics, Inc., a division of Schawk, Inc. and C.W.
    Properties.                         |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .26* |  | Schawk, Inc. 1991 Outside Directors Formula Stock Option
    Plan, as amended.                                                                                 |  | Appendix C to Proxy Statement for the 2001 Annual Meeting
    of Stockholders (File No. 001-09335)    
|
| | 10 | .27* |  | Form of Clarence W. Schawk Amended and Restated Employment
    Agreement between Clarence W. Schawk and Schawk, Inc.                                            |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .28* |  | Form of David A. Schawk Amended and Restated Employment
    Agreement between David A. Schawk and Schawk, Inc.                                                  |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .31  |  | Form of Registration Rights Agreement dated December 30,
    1994, by and among Schawk, Inc. and certain investors.                                             |  | Registration Statement No. 33-85152                                                                   
|
| | 10 | .35  |  | Letter of Agreement dated September 21, 1992, by and
    between Schawk, Inc. and Judith W. McCue.                                                              |  | Registration Statement No. 33-85152 1996 10-K                                                         
|
| | 10 | .37* |  | Schawk, Inc. Retirement Trust effective January 1, 1996.                                                                                                        |  | (File No. 001-09335) 1996 10-K                                                                        
|
| | 10 | .38* |  | Schawk, Inc. Retirement Plan for Imaging Employees Amended and
    Restated effective January 1, 1996.                                                          |  | (File No. 001-09335)                                                                                  
|
| | 10 | .43  |  | Stockholder Investment Program dated July 28, 1995.                                                                                                             |  | Registration Statement No. 33-61375                                                                   
|
| | 10 | .45* |  | Schawk, Inc. Employee Stock Purchase Plan effective
    January 1, 1999.                                                                                        |  | Registration Statement No. 333-68521                                                                  
|
| | 10 | .47  |  | Note Purchase Agreement dated December 23, 2003 by and
    between Schawk, Inc and Massachusetts Mutual Life Insurance
    Company                              |  | 2003 10-K
    (File No. 001-09335)                                                                    
|
| | 10 | .48  |  | Credit Agreement dated June 11, 2004 by and between Schawk
    Inc. and Bank One, N. A.                                                                         |  | Form 8-K dated June 16, 2004
    (File No. 001-09335)                                                 
|
| | 10 | .49  |  | Schawk, Inc. 2001 Equity Option Plan                                                                                                                            |  | Appendix B to Proxy Statement for the 2001 Annual Meeting
    of Stockholders
    (File No. 001-09335)

62



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##### Table of Contents



| |      |     |  |                                                                                                                                                                                                                                                                               |  |                                                                                                       
| | ---- | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------
| |      |     |  | Incorporated Herein                                                                                                                                                                                                                                                          
| |      |     |  | by Reference to                                                                                                                                                                                                                                                              
| |      |     |  |                                                                                                                                                                                                                                                                              
| | 10   | .50 |  | Schawk, Inc. 2003 Equity Option Plan                                                                                                                                                                                                                                          |  | Appendix A to Proxy Statement for the 2003 Annual Meeting
    of Stockholders
    (File No. 001-09335)
|
| | 10   | .51 |  | Stock Purchase Agreement by and among Schawk, Inc., Seven
    Worldwide, Inc., KAGT Holdings, Inc. and the Stockholders of
    KAGT Holdings, Inc. dated as of December 17, 2004.                                                                                             |  | Exhibit 2.1 to Form 8-K filed with the SEC on
    December 20, 2004
    (file no. 001-09335)          
|
| | 10   | .52 |  | Business Sale Deed by and among Schawk, Inc., Schawk UK Limited,
    Sokaris XXI, S.L., Schawk Belgium B.V.B.A. and Weir Holdings
    Limited dated December 31, 2004.                                                                                                        |  | Exhibit 2.1 to Form 8-K filed with the SEC on
    January 6, 2005 (file no. 001-09335)                
|
| | 10   | .53 |  | Amended and Restated Registration Rights Agreement, dated as of
    January 31, 2005, among Schawk, Inc. and certain principal
    stockholders of Schawk, Inc.                                                                                                               |  | Exhibit 10.1 to Form 8-K filed with the SEC on
    February 2, 2005
    (file no. 001-09335)          
|
| | 10   | .54 |  | Registration Rights Agreement, dated as of January 31,
    2005, among Schawk, Inc., certain principal stockholders of
    Schawk, Inc. and certain stockholders of KAGT Holdings, Inc.                                                                                       |  | Exhibit 10.2 to Form 8-K filed with the SEC on
    February 2, 2005
    (file no. 001-09335)          
|
| | 10   | .55 |  | Governance Rights Agreement, dated as of January 31, 2005,
    among Schawk, Inc., certain principal stockholders of Schawk,
    Inc. and certain stockholders of KAGT Holdings, Inc.                                                                                         |  | Exhibit 10.3 to Form 8-K filed with the SEC on
    February 2, 2005
    (file no. 001-09335)          
|
| | 10   | .56 |  | Credit Agreement, dated as of January 28, 2005, among
    Schawk, Inc., certain subsidiaries of Schawk, Inc. from time to
    time party thereto, certain financial institutions from time to
    time party thereto as lenders, and JPMorgan Chase Bank, N.A., as
    agent. |  | Exhibit 10.4 to Form 8-K filed with the SEC on
    February 2, 2005
    (file no. 001-09335)          
|
| | 10   | .57 |  | Note Purchase and Private Shelf Agreement, dated as of
    January 28, 2005, among Schawk, Inc., Prudential Investment
    Management, Inc., The Prudential Insurance Company of America,
    and RGA Reinsurance Company.                                                    |  | Exhibit 10.5 to Form 8-K filed with the SEC on
    February 2, 2005
    (file no. 001-09335)          
|
| | 10   | .58 |  | First Amendment to Note Purchase Agreement, dated as of
    January 28, 2005, among Schawk, Inc. and the institutional
    purchasers party thereto.                                                                                                                          |  | Exhibit 10.6 to Form 8-K filed with the SEC on
    February 2, 2005 (file no. 001-09335)              
|
| | 10   | .59 |  | Description of executive compensation arrangements                                                                                                                                                                                                                            |  | Form 8-K filed with the SEC on June 6, 2005
    (file no. 001-09335)                                  
|
| | 21** |     |  | List of Subsidiaries.                                                                                                                                                                                                                                                         |  |                                                                                                       
|
| | 23** |     |  | Consent of Independent Registered Public Accounting Firm                                                                                                                                                                                                                      |  |                                                                                                       

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| |      |      |  |                                                                                                                                                                       |                                                                   |                                                                           |  | 
| | ---- | ---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ------------------------------------------------------------------------- |  | 
| |      |      |  | Incorporated Herein                                                                                                                                                  
| |      |      |  | by Reference to                                                                                                                                                      
| |      |      |  |                                                                                                                                                                      
| | 31   | .1** |  |                                                                                                                                                                       | Certification of Chief Executive Officer pursuant to Rule  13a-14 | (a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended |  | 
|
| | 31   | .2** |  |                                                                                                                                                                       | Certification of Chief Financial Officer pursuant to Rule  13a-14 | (a) and rule 15d-14(a) of the Securities Exchange Act of 1934, as amended |  | 
|
| | 32** |      |  | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |                                                                   |                                                                          






|  |                                                                                                                     
|- | --------------------------------------------------------------------------------------------------------------------
|* | Represents management contract or compensation plan or
    arrangement required to be filed pursuant to Item 14 (c).



|   |                         
|-- | ------------------------
|** | Document filed herewith.

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Schawk, Inc.


SCHEDULE II  VALUATION AND QUALIFYING
ACCOUNTS


ALLOWANCE FOR DOUBTFUL ACCOUNTS


|                                  |  |                         |       |   |      |   |       |      |  |   |       | 
|--------------------------------- |  | ----------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | 
|                                  |  | Year Ended December 31, |      
|                                  |  |                         |      
|                                  |  | 2005                    |       |   | 2004 |   |       | 2003 | 
|                                  |  |                         |       |   |      |   |       |      | 
|                                  |  | (In thousands)          |      
|Balance beginning of year         |  | $                       | 1,773 |   |      | $ | 1,595 |      |  | $ | 1,269 | 
|Acquisitions                      |  |                         | 6,101 |   |      |   |      |      |  |   |      | 
|Provision (reversal of provision) |  |                         | (446  | ) |      |   | 752   |      |  |   | 613   | 
|Deductions(1)                     |  |                         | 970   |   |      |   | 574   |      |  |   | 287   | 
|Foreign currency adjustment       |  |                         | (135  | ) |      |   |      |      |  |   |      | 
|                                  |  |                         |       |   |      |   |       |      | 
|Balance end of year               |  | $                       | 6,323 |   |      | $ | 1,773 |      |  | $ | 1,595 | 






|    |                                                       
|--- | ------------------------------------------------------
|(1) | Uncollectible accounts written off, net of recoveries.

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SIGNATURES






| |             
| | ------------
| | Schawk, Inc.



| |     |                       
| | --- | ----------------------
| | By: | /s/ Clarence W. Schawk

| | 
| | 
| | 



| |                      
| | ---------------------
| | Clarence W. Schawk   
| | Chairman of the Board



|                                               |  |                                                                                                                          |  | 
|---------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------ |  | 
|                                              
|/s/ Clarence W. SchawkClarence W. Schawk       |  | Chairman of the Board and Director                                                                                      
|                                              
|/s/ David A. SchawkDavid A. Schawk             |  | President, Chief Executive Officer, and Director (Principle
    Executive Officer)                                      
|                                              
|/s/ A. Alex Sarkisian Esq.A. Alex Sarkisian    |  | Executive Vice President,
    Chief Operating Officer and Director                                                      
|                                              
|/s/ James J. PattersonJames J. Patterson       |  | Senior Vice President and Chief Financial Officer (Principle
    Financial Officer and
    Principle Accounting Officer)
|                                              
|/s/ John T. McEnroe, Esq.John T. McEnroe, Esq. |  | Director and Assistant Secretary                                                                                        
|                                              
|/s/ Leonard S. CaroniaLeonard S. Caronia       |  | Director                                                                                                                
|                                              
|/s/ Judith W. McCue, Esq.Judith W. McCue, Esq. |  | Director                                                                                                                
|                                              
|/s/ Hollis W. RademacherHollis W. Rademacher   |  | Director                                                                                                                
|                                              
|/s/ Christopher LacovaraChristopher Lacovara   |  | Director                                                                                                                

66