GRACO INC — Director's Dealing 2008

Feb 14, 2008

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: GRACO INC (GGG)
CIK: 0000042888
Period of Report: 2008-02-13

Reporting Person: Chambers Caroline M (Vice President and Controller)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2008-02-13	Common Stock	M	375	$8.76	Acquired	1829.235	Direct
2008-02-13	Common Stock	S	375	$36.57	Disposed	1454.235	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2008-02-13	Non-Qualified Stock Option (right to buy)	$8.76	M	375	Disposed	2008-02-18	Common Stock (375)	Direct

Footnotes

F1: The amount of securities owned includes shares of Graco Common Stock acquired under the Graco Inc. Automatic Dividend Reinvestment Plan, exempt under Rule 16a-11.

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.