AMENDMENT AGREEMENT - GRACO EXECUTIVE LONG TERM INCENTIVE AGREEMENT
                            (RESTRICTED STOCK AWARD)


Amendment  Agreement,  entered  into this  22nd day of  February,  1999,  by and
between  Graco  Inc.,  a  Minnesota  corporation  (the  "Company"),  and  George
Aristides  ("Mr.  Aristides")  which  amends the  Agreement  between the parties
entitled  "Graco  Executive  Long Term  Incentive  Agreement  (Restricted  Stock
Award)", dated May 6, 1998 (the "Agreement").

WHEREAS, the Management  Organization and Compensation Committee of the Board of
Directors  and  Mr.  Aristides  have  discussed  the  transition  of  management
leadership of the Company,  and have  determined  that in  connection  with such
transition it may be  appropriate  for Mr.  Aristides to retire from the Company
before the end of 1999.

NOW, THEREFORE, the parties hereto agree as follows:

1.   Section  2(a) of the  Agreement  is amended  to change  the phrase  therein
     "March 31, 2000" to "December 27, 1999",  the effect being that the vesting
     of the shares  designated  by the Agreement to vest on March 31, 2000 shall
     vest on December 27, 1999.

2.   This Amendment  Agreement  fully  replaces,  and renders null and void, the
     amendment to the Agreement signed by the parties dated December 11, 1998.

IN WITNESS  WHEREOF,  the Company and Mr.  Aristides  have caused this Amendment
Agreement to be executed and  delivered,  all as of the day and year first above
written.



            George Aristides
            /s/George Aristides



            GRACO INC.

            By:/s/Robert M. Mattison
               -----------------------------------------------
               Robert M. Mattison
               Vice President, General Counsel and Secretary