GRACO INC — Director's Dealing 2005

Feb 16, 2005

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: GRACO INC (GGG)
CIK: 0000042888
Period of Report: 2005-02-14

Reporting Person: SHEAHAN MARK W (VICE PRESIDENT AND TREASURER)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2005-02-14	Common Stock	M	4218	$6.37	Acquired	15405	Direct
2005-02-14	Common Stock	M	4218	$9.09	Acquired	19623	Direct
2005-02-14	Common Stock	M	2813	$11.71	Acquired	22436	Direct
2005-02-14	Common Stock	M	2813	$12.38	Acquired	25249	Direct
2005-02-14	Common Stock	S	8000	$38.2	Disposed	17249	Direct
2005-02-14	Common Stock	S	4300	$38.19	Disposed	12949	Direct
2005-02-14	Common Stock	S	100	$38.18	Disposed	12849	Direct
2005-02-14	Common Stock	S	962	$38.17	Disposed	11887	Direct
2005-02-14	Common Stock	S	700	$38.16	Disposed	11187	Direct
2004-06-30	Common Stock	J	0.66	$31.05	Acquired	347.1285	Indirect
2004-09-30	Common Stock	J	0.507	$33.5	Acquired	347.6355	Indirect
2004-12-31	Common Stock	J	0.2274	$37.35	Acquired	347.8629	Indirect

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2005-02-14	Non-Qualified Stock Option (right to buy)	$6.37	M	4218	Disposed	2009-02-22	Common Stock (4218)	Direct
2005-02-14	Non-Qualified Stock Option (right to buy)	$9.09	M	4218	Disposed	2010-02-23	Common Stock (4218)	Direct
2005-02-14	Non-Qualified Stock Option (right to buy)	$11.71	M	2813	Disposed	2011-02-23	Common Stock (2813)	Direct
2005-02-14	Non-Qualified Stock Option (right to buy)	$12.38	M	2813	Disposed	2011-04-19	Common Stock (2813)	Direct

Holdings (Non-Derivative)

Security	Shares	Ownership
Common Stock	964	Indirect

Footnotes

F1: Dividends paid pursuant to the Graco Employee Stock Ownership Plan, exempt under Rule 16b-3(c).

F2: Employee stock option granted pursuant to the Graco Inc. Long-Term Stock Incentive Plan in a transaction exempt under Rule 16b-3. The stock option becomes exercisable in four equal annual installments, commencing two years after the date of the grant.

F3: Employee stock option granted pursuant to the Graco Inc. Long-Term Stock Incentive Plan in a transaction exempt under Rule 16b-3. The stock option becomes exercisable in four equal annual installments, commencing one year after the date of the grant.