W.W. Grainger (GWW)

Summary Compensation Information

        This table provides summary information about compensation paid to or accrued for the named executive officers for services during the years ended December 31, 2005, 2004, and 2003.

(1)

Represents fixed annual salary and car allowance.

(2)

Represents amounts paid under annual cash incentive programs.

(3)

Includes $102,322 for personal use of Grainger aircraft, reflecting Grainger's total incremental cost of such use. Grainger has used a methodology that includes incremental costs such as aircraft fuel, landing and parking services, crew travel expenses, in-flight food and beverages and other expenses.

(4)

Represents values on the dates of award of restricted shares or restricted stock units of Grainger common stock. Restricted shares have the same rights, including dividend and voting rights, as other shares of Grainger common stock. Restricted stock units are eligible for dividend equivalents. As of December 31, 2005, Messrs. Keyser, Ryan, Loux, Howard, and Chen held 190,595, 46,500, 41,500, 28,350, and 32,350 restricted shares and restricted stock units, having then-current market values of $13,551,305, $3,306,150, $2,950,650, $2,015,685, and $2,300,085, respectively. Vesting of the restricted shares and restricted stock units ranges from already-vested to 2011, in all cases assuming the executive's continued employment with Grainger. Acceleration of vesting of all restricted shares and restricted stock units would occur in the event of the holder's retirement, death or disability or events defined as a "change in control" of Grainger. The restricted stock units are to be settled, at various times after vesting, by the delivery of unrestricted shares of Grainger common stock on a 1-for-1 basis.

(5)

Includes contributions accrued under Grainger's profit sharing plan, in which most Grainger employees participate, and the related supplemental profit sharing plan. Also includes, for deferred compensation plan participants, company contributions that would otherwise have been made to the supplemental profit sharing plan.

17

Summary Compensation Information

        This table provides summary information about compensation paid to or accrued for the named executive officers for services during the years ended December 31, 2004, 2003, and 2002.

(1)

Represents fixed annual salary and car allowance.

(2)

Represents amounts paid under annual cash incentive programs.

(3)

Represents values on the dates of award of restricted shares or restricted stock units of Grainger common stock. Restricted shares have the same rights, including dividend and voting rights, as other shares of Grainger common stock. Restricted stock units are eligible for dividend equivalents. As of December 31, 2004, Messrs. Keyser, Loux, Ryan, Howard, and Chen held 160,595, 35,000, 39,500, 24,000, and 28,050 restricted shares and restricted stock units, having then-current market values of $10,698,839, $2,331,700, $2,631,490, $1,598,880, and $1,868,691, respectively. Vesting of the restricted shares and restricted stock units ranges from already-vested to 2011, in all cases assuming continued employment with Grainger. Acceleration of vesting of all restricted shares and restricted stock units will occur in the event of the holder's death or disability or events defined as a "change in control" of Grainger. The restricted stock units are to be settled, at various times after vesting, by the delivery of unrestricted shares of Grainger common stock on a 1-for-1 basis.

16

(4)

Represents contributions accrued under Grainger's profit sharing plan, in which most Grainger employees participate, and the related supplemental profit sharing plan.

(5)

Includes a relocation-related tax equalization payment in the amount of $48,319.