Item 1.01. Entry into a Material Definitive Agreement

On May 31, 2012, the Federal Trade Commission ("Commission") voted to accept an Agreement Containing Consent Orders ("Consent Agreement") with Graco Inc. (the "Registrant"), Illinois Tool Works Inc. ("ITW"), and ITW Finishing LLC ("ITW Finishing"). The Registrant, ITW and ITW Finishing entered into the Consent Agreement to resolve an Administrative Complaint issued by the Commission in December 2011 charging the Registrant, ITW and ITW Finishing with violations of
Section 7 of the Clayton Act and Section 5 of the Federal Trade Commission Act ("Complaint"). The Consent Agreement contains a Proposed Decision and Order ("Proposed Order") that would require the Registrant to sell the liquid finishing operations it acquired from ITW and ITW Finishing on April 2, 2012, including those involved in the development, manufacture and sale of BinksŪ spray finishing equipment, DeVilbissŪ spray guns and accessories, RansburgŪ electrostatic equipment and accessories and BGK curing technology. The Proposed Order will be subject to public comment for thirty (30) days, until July 2, 2012, after which the Commission will decide whether to make it final.

The Registrant, ITW and ITW Finishing entered into the Consent Agreement for settlement purposes only, neither admitting that the law had been violated nor that the facts as alleged in the Complaint, other than the jurisdictional facts, were true. In the Consent Agreement, the Registrant, ITW and ITW Finishing waived, among other things, all rights to seek judicial review or otherwise challenge or contest the validity of the Proposed Order or the Order to Hold Separate and Maintain Assets issued by the Commission on March 26, 2012.

The full terms of the agreement between the FTC and the Registrant, ITW and ITW Finishing are set forth in the Consent Agreement, a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.

Item 8.01. Other Events

A copy of the press release issued by the Registrant on May 31, 2012, announcing the Commission's approval of the Proposed Order for public comment is attached as Exhibit 99.1 hereto and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

10.1 Agreement Containing Consent Orders.

99.1 Press Release dated May 31, 2012.

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