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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C., 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year Ended August 31, 1996 Commission File Number: 1-9852

CHASE CORPORATION
(Exact name of registrant as specified in its charter)

Massachusetts 11-1797126
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification No.)

50 Braintree Hill Park, Braintree, Massachusetts 02184
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (617) 848-2810

Securities registered pursuant to section 12(b) of the Act:

Common Stock, $.10 par value American Stock Exchange
(Title of class) Name of each exchange on which
registered

Securities registered pursuant to section 12(g) of the Act:

Common Stock, $.10 par value
(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

Yes X No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K ( 229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [ x ]

As of October 31, 1996, the Company had outstanding 3,809,630 shares of common
stock, $.10 par value, which is its only class of common stock; and the
aggregate market value of the voting stock held by non-affiliates of the
registrant was $27,381,000.

DOCUMENT INCORPORATED BY REFERENCE

The registrant's definitive proxy statement (the "Definitive Proxy Statement")
to be filed in connection with the Annual Meeting of Shareholders to be held on
January 21, 1997, is incorporated by this reference into items 10-13 hereof.













PART I

Item 1. Business.

General Development and Industry Segment.
Chase Corporation (the "Company") is primarily engaged in the manufacture
of protective coatings and tape products. The Company implemented a strategy
of focusing its direction towards its core businesses which resulted in the
divesting of its elastomeric materials division and the discontinuance of the
fuel technology products and services division during fiscal 1991. During
1992, a facility that manufactures tape and related products in Webster,
Massachusetts became operational. In April 1992, the Company acquired
certain tape product lines and associated assets for cash from The Stewart
Group, Ltd. This division, Chase Canada, maintains manufacturing operations
in Winnipeg, Manitoba, Canada. Effective May 25, 1994, the Company purchased
the electrical cable insulation tape product lines and certain associated
assets from Haartz Mason, Inc. and these products were folded into the Chase
& Sons division. On June 5, 1995, the Company formed a joint venture with the
Stewart Group, Ltd. which was called The Stewart Group, Inc. This venture
produces a variety of dielectric strength members from composite materials
and sold into the fiber optic cable market. The original investment was
increased on February 1, 1996. The additional investment enabled the venture
to purchase equipment and a license in order to broaden its opportunities.
The Company now owns 42% of this venture. On June 29, 1995, certain assets of
Fluid Polymers, Inc. of Las Vegas, Nevada were acquired and then relocated to
the Royston facility. On June 11, 1996, the Company acquired a 20% interest
in Wireless, Inc. a provider of telecommunications services. In a
continuance of a strategy of selective investments, on August 27, 1996
announced the purchase of a 20% interest in D. C. Scientific, which provides
circuit board assembly services to electronic goods manufacturers, and a 32%
interest in webpa.com, an internet software developer. There have no been any
other material changes or developments since September 1, 1996.

As of October 31, 1996, the Company employed approximately 139 people.

Products and Markets.
The Company's principal products are protective coatings and tape products
that are sold by Company salespeople and manufacturers' representatives. These
products consist of: (i)insulating and conducting materials for the manufacture
of electrical and telephone wire and cable, and electrical splicing,
terminating and repair tapes which are marketed to wire and cable
manufacturers and public utilities; (ii)protective pipe coating tapes and
other protectants for valves, regulators, casings, joints, metals, concrete,
and wood that are sold to oil companies, gas utilities, and pipeline
companies; (iii)protectants for highway bridge deck metal surfaces sold to
municipal transportation authorities; (iv)thermo-electric insulation for
transformers, motors, and other electrical equipment that are sold to
original equipment manufacturers; and (v)moisture protective coatings that
are sold to the electronics industry. There are no material seasonal aspects
to the Company's business and the Company has introduced no new products or
segments requiring an investment of a material amount of the Company's assets.

Backlog, Customers and Competition.
As of October 31, 1996, the backlog of orders believed to be firm was
about $1,654,000, all of which is expected to be filled in fiscal year 1997.
As of October 31, 1995 the backlog was approximately $1,409,000. The backlog
is not seasonal. The Company does not do business with any customer the loss
of which would have a material adverse effect on the Company and no material
portion of the Company's business is subject to renegotiation or termination
of profits or contracts at the election of the government.
Many companies manufacture or sell protective coatings and tape
products similar to those of the Company, some of which companies are larger
and have greater financial resources than the Company. Competition is
principally based on technical performance, service reliability, quality and
price.

Raw Materials.
The Company obtains raw materials from a wide variety of suppliers with
alternative sources of all essential materials available within reasonable
lead time.


Patents, Trademarks, Licenses, Franchises and Concessions.
Other than HumiSeal , a trademark for moisture protective coatings sold
to the electronics industry, and Chase BLH2OCK , a trademark for water blocking
compound sold to the wire and cable industry, there are no material trademarks,
licenses, franchises, or concessions. The Company holds various patents, but
believes that at this time they are not material to the success of the business.

Working Capital and Research and Development.
There are no special practices followed by the Company relating to working
capital. Approximately $502,000, $511,000 and $594,000 was spent for Company-
sponsored research and development during the fiscal years 1996, 1995 and 1994,
respectively.

Environmental Disclosures.
The Company is aware of potential claims concerning a site in Bruin,
Pennsylvania where an affiliate of the Company had sponsored research into
experimental oil and coal-based fuels in the early 1980's. In August 1991, a
spill of the affiliate's stored material occurred at the Bruin site, apparently
due to vandalism of the storage tanks. Upon learning of the spill, the Company
provided notice of the release to appropriate authorities and undertook to
remedy the spill. The remedy was completed in October 1992 under plans
approved by the Pennsylvania Department of Environmental Protection
("Pennsylvania DEP"). The Company believes that this work terminated its
liabilities for the spill, but Pennsylvania DEP has not provided a final
release.

The Bruin site had been used for many years for a variety of oil refining
operations by unrelated parties. The site has significant contamination from
those unrelated activities. Since the spill of the material remedied by the
Company, the U.S. Environmental Protection Agency has conducted an
investigation of the site, conducted emergency clean-up activities at the
site focused on materials other than the affiliate's material and spill, and
turned responsibility for the site back to Pennsylvania DEP. To date, EPA has
not made any claim against the Company.

During 1993 to 1995, Pennsylvania DEP has conducted an investigation of
the site, has completed a surface cleanup, and has proposed a permanent remedy.
Pennsylvania DEP has notified the Company that it may be a person responsible
under Pennsylvania law to contribute to the costs of those activities. During
1995, Pennsylvania DEP suggested that the Company contribute an amount toward
the costs of the investigation and the surface cleanup in an attempt to
settle with the Company. On July 18, 1996, the Pennsylvania DEP sent a
settlement proposal to Chase requesting a payment of $335,000 to resolve all
of Chase's potential liabilities to the State of Pennsylvania at the Bruin
site. While the amount proposed is not deemed material, the Company still
believes that the work previously performed to remedy the spill terminated
its liabilities and therefore declined the proposal.

The Company remains in communication with Pennsylvania DEP, and expects
that it will eventually determine that the Company resolved any potential
liability at the site by its response to the 1991 spill.

See also Legal Proceedings Caption.

Financial Information about Foreign and Domestic Operations and Export Sales.
Export sales from continuing domestic operations to unaffiliated third
parties were $3,594,000, $2,764,000 and $2,486,000 for the years ended August
31, 1996, 1995 and 1994, respectively. The Company does not anticipate any
material change to export sales during fiscal 1996. The Company's products
are sold world-wide with no foreign geographic area accounting for more than
10% of revenues. The Company's Canadian operations accounted for 6.3% of
consolidated sales and 8.3% of its assets.

The Company has very limited currency exposure since all invoices, except
those from the Canadian operation to Canadian customers, are denominated in US
dollars. The Company maintains minimal cash balances in Canada and, other than
the currency conversion effects on the fixed assets in Canada, which are
deferred and recorded directly in equity per FAS52, there are no significant
assets held in foreign currencies. The Company does not engage in hedging
activities. Foreign currency transaction gains or losses have not been
material.


Item 1A. Executive Officers of the Registrant.

The following table sets forth information concerning the Company's
executive officers. Each officer is selected by the Company's Board of
Directors and holds office until his successor is elected and qualified.

Name Age Offices Held and Business Experience during Past
Five Years.
Peter R. Chase 48 Chief Executive Officer of the Company since
September 1993 and President of the Company since
April 1992; Chief Operating Officer of the Company
since September 1988.


Everett Chadwick,Jr. 55 Treasurer of the Company since September 1993 and
Chief Financial Officer since September 1992;
Director of Finance of the Company from April 1991
to August 1993 and Controller of the Company from
September 1988 to August 1993.



Item 2. Properties.

The Company leases its principal executive office, which is located in
Braintree, Massachusetts and contains approximately 4,300 square feet. The
Company also rents a modern one-story building of approximately 5,000 square
feet in Woodside, New York, which is used by the conformal coatings division.

A division of the Company engaged in the manufacture and sale of
electrical protective coatings and tape products uses offices and plants
owned by the Company that are located on seven acres in Randolph,
Massachusetts and consist of a three-story building containing about 10,500
square feet and ten one-story buildings, aggregating about 67,000 square feet.
This division also currently leases about 25,000 square feet of manufacturing
space in a new building in Webster, Massachusetts. This plant manufactures
tape and related products for the electronic, telecommunication and high
technology industries.

Another division of the Company uses offices and a plant, owned by the
Company, that are located on three acres in Pittsburgh, Pennsylvania and
consist of thirteen buildings, three of which are used for offices, one of
which is rented as a residence and the rest of which are used as
manufacturing and warehouse facilities. These facilities, excluding the
residence, contain about 44,000 square feet and are used in the manufacture
and sale of protective coatings and tape products.

The Canadian division of the Company is engaged in the process of
laminating and slitting film, foils and papers primarily for the wire and cable
industry. This division leases about 14,000 square feet of manufacturing space
in a modern building in Winnipeg, Manitoba, Canada.

The above facilities range in age from new to about 100 years. They
generally are in good condition and, in the opinion of management, adequate and
suitable for present operations. The Company also owns equipment and machinery
that is in good repair and, in the opinion of management, adequate and suitable
for present operations. The Company could significantly add to its capacity by
increasing shift operations. Availability of machine hours through additional
shifts would provide expansion of current product volume without significant
additional capital investment.


Item 3. Legal Proceedings.

The Company has been named as a third party defendant in eighteen personal
injury lawsuits filed in state court in Jackson County, Mississippi. These
lawsuits, each of which has multiple plaintiffs and defendants, arose out of
alleged asbestos exposure by the plaintiffs as a result of their work at the
Ingalls Shipyard. The Company was sued as a third-party defendant by USX
Corporation, General Cable Corporation and G.K. Technologies, Inc., each of
whom is a primary defendant in these actions. USX, General Cable and G.K.
are alleged to have supplied wire and cable products containing asbestos to
the shipyard. The third-party complaints allege that tape products
containing asbestos were manufactured by the Company, sold to USX, General
Cable and G.K., and then incorporated in their wire and cable products sold
for use in the ships. USX, General Cable and G.K. are seeking
indemnification from the Company for damages that may be assessed against
them and expenses including legal fees.

The third-party claims against the Company, along with all other third-
party and crossclaims, were severed from the trial of the primary actions. USX,
General Cable and G.K. were each dismissed by the plaintiffs prior to the
commencement of trial of nine of the primary actions, which took place in the
summer of 1993. It is not known how much, if anything, each paid to settle
these claims. To date, no effort has been made by USX, General Cable or G.K.
to pursue the third-party claims against the Company arising out of the
resolution of any of the cases tried in the summer of 1993. Some of the
remaining primary actions remain pending, but it is not now known when those
cases will be tried, whether the plaintiffs will proceed against any of the
wire and cable manufacturers, including USX, General Cable or G.K., and
whether any of these defendants will, in turn, pursue their claims against
the Company.

The Company's liability insurer has assumed defense of these claims
subject to reservation of its rights as to coverage for any underlying
liability assessed.

In July 1994, the Company received a notice letter from General Cable and
G.K. that they have been sued in fourteen additional asbestos personal injury
lawsuits, ten of which are pending in Mississippi, two in Pennsylvania and two
in Texas. Each of these cases involves multiple plaintiffs and defendants.
This notice letter is an effort to bind the Company to the factual
determination made in these cases, if General Cable or G.K. brings an action
against the Company for indemnification arising out of these cases. No such
action for indemnification has yet been brought and the Company is not now a
party in any of these fourteen additional cases. The Company's liability
insurer has been informed that the Company has been notified of these
potential claims.

The Company is investigating the defenses available to it in connection
with all these matters and its rights against its supplier. Although the
Company cannot predict whether any of these claims will be pursued,
management believes that such claims will not have any material financial
impact on the Company.

See also Environmental Disclosures Caption.

Item 4. Submission of Matters to a Vote of Security Holders.

There were no matters submitted to a vote of the Company's security
holders during the fourth quarter of the Company's last fiscal year.

PART II


Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters.

The Company's common stock is traded on the American Stock Exchange
(symbol CCF). The approximate number of record holders of the Company's
common stock on October 31, 1996 was 918.

The quarterly high and low sales prices for the Company's common stock
over the last two years were as follows:


Year ended August 31, 1996 Year ended August 31, 1995
Sales Price Sales Price


Quarter Ended Low High Low High
November 30 5 1/4 4 5/16 3 13/16 2 7/8

February 28 5 5/8 4 1/16 4 1/8 3 1/2

May 31 5 3/8 4 1/4 3 9/16 3 1/4

August 31 7 5 1/4 4 3/4 3 1/8

The Company paid cash dividends of fifteen cents ($0.15) per share on
November 30, 1996 and ten cents ($0.10) per share on November 30, 1995 to
shareholders of record of the Company's common stock on October 31, 1996 and
October 31, 1995, respectively.



Item 6. Selected Financial Data.



1996 1995 1994 1993 1992

Net Sales and other $34,366,029 $32,734,893 $28,654,421 $25,894,603 $23,124,157
operating revenues

Income from continuing 2,194,985 1,907,884 1,608,621 1,039,866 1,340,749
operations before
extraordinary items

Equity in earnings 82,965 19,951 --- --- ---
of unconsolidated
joint venture

Net (Loss) from --- --- --- --- (119,790)
discontinued operations

Income before cumulative 2,277,950 1,927,835 1,608,621 1,039,866 1,220,959
effect of accounting
change

Cumulative effect of --- --- --- --- 6,164
change in method of
accounting for income
taxes

Net Income 2,277,950 1,927,835 1,608,621 1,039,866 1,227,123

Total Assets 19,786,827 20,002,586 18,134,618 14,747,462 14,651,492

Long-term debt and 4,481,071 6,464,260 2,897,976 1,772,080 1,150,000
capital leases

Per Common Share:

Income per share .61 .43 .35 .24 .28
fully diluted

Cash dividends* .15 .10 .08 .06 .05


*Single annual payments declared and paid subsequent to fiscal year end.












Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.



SELECTED RELATIONSHIPS WITHIN THE CONSOLIDATED
STATEMENTS OF OPERATIONS

Years Ended August 31,
1996 1995 1994
(Dollars in thousands)


Net revenue................................ $34,366 $32,735 $28,654

Net Income................................. $ 2,278 $ 1,928 $ 1,609

Increase in net revenue from previous
year

Amount.................................. $ 1,631 $ 4,081 $ 2,760

Percentage.............................. 5% 14% 11%

Increase in net income from
previous year........................... $ 350 $ 319 $ 569


Percentage of net revenue:

Net revenue............................. 100.0% 100.0% 100.0%

Expenses:
Cost of Sales........................... 66.0 67.1 65.3

Selling, general and
administrative expenses.............. 22.1 22.2 24.1

Other expenses.......................... 1.7 1.2 1.2

Income before income taxes.............. 10.2 9.5 9.4

Provision for income taxes.............. 3.6 3.6 3.8

Net Income.............................. 6.6% 5.9% 5.6%
















Results of Operations

Total revenues for fiscal 1996 increased 5% to $34.4 million when compared
to $32.7 million in 1995. The increase was largely due to the steady growth
of sales from the Webster facility of the Chase & Sons division which utilizes
100% solids technology to produce shielding tapes for the wire and cable
market. We also received some benefit from increased revenue generated as a
result of the Fluid Polymers acquisition along with some continued
strengthening of the Company's international sales. Our more traditional
product lines were basically unchanged when compared to the prior period.

The sales increase during fiscal 1995, as compared to 1994 was largely due
to the Haartz Mason product line acquisition, an increased share of the
market for shielding tapes used in electronic data cables and improved sales
of Megolon , a product sold through a distributorship agreement. The
Humiseal division growth was related to the growing demand for its products
in non-defense applications. These were somewhat offset by lower sales from
Chase Canada as these markets remained very soft and have gone through a
state of transition and consolidation.

The dollar value of cost of products was higher in fiscal 1996 compared to
both 1995 and 1994. To a large extent, these increases were volume related.
As a percent of sales, cost of products decreased to 66.8% in 1996 from 67.9%
in 1995, an increase from 1994 which was 66.6%. During the past fiscal year,
lower raw material costs were somewhat offset by increases of some
manufacturing expenses. Direct labor remained about the same. Competitive
pressures prevent the company from recovering any price increases from
customers. Fiscal 1995 costs were higher largely because of raw material
shortages and related price increases.

Selling and administrative expenses in 1996 increased by $316,000 and
$699,000 when compared to 1995 and 1994, respectively. However, as a percent
of sales, 1996 was about the same as 1995 and was 2.1% lower than the
previous year. A significant portion of these increases relate to the costs
associated with increased levels of sales.

Bad debt expense for 1996 and 1995 was considerably lower and more normal
when compared to 1994. Fiscal 1994 provided for write-offs and reserves
established on certain accounts affected during a previously difficult
economic environment.

Interest expense increased to $595,000 in 1996 from $396,000 in 1995.
About 40% of our 1996 interest expense was related to the obligation
associated with the repurchase of shares and the buy out of a Consulting and
Non-Compete Agreement from a retired officer of the company. Interest
expense in 1995 was higher than fiscal 1994 due to higher rates of interest,
increased debt related to outside investments and the carrying cost of certain
inventory items where shortages were anticipated. Some interest expense is
offset by interest income earned from the note receivable acquired as a
result of the elastomeric material division sale. The Company continues to
benefit from low borrowing rates from its lender providing funds at its
bank's prime rate or a LIBOR - based rate, whichever is lower.

The continued solid operating performance over the past few years has been
a result of management's ability to respond quickly to business issues and
market opportunities while employing tight cost containment policies where
required. Management will continue this approach of maximizing our current
businesses and at the same time seeking out future opportunities through
selective acquisitions.

The federal tax rates for the fiscal years 1996, 1995 and 1994 are
slightly lower when compared to the applicable rates because of the export
sales through the Chase Export Corporation subsidiary.

Liquidity and Sources of Capital.
Cash flow generated from operations was $4,419,000 in 1996 as compared to
$157,000 in 1995. During 1996, the primary asset change was the reduction
to inventory. Last year's cash flow was reduced because of the decision to
increase inventory to reduce exposure to price increases and shortages,
increased receivables related to higher sales during the end of the fiscal
year and cash associated with the early buyout of the Consulting and Non-
Compete Agreement of a retired officer of the Company.

The ratio of current assets to current liabilities was 1.6 at the end of
the current fiscal year, compared to 1.8 and 1.6 at the end of the 1995 and
1994 fiscal years.

The unused available long-term credit amounted to $2,440,000 at August
1996, compared to $1,840,000 at August 1995. Effective September 11, 1996 the
Company's maximum credit availability was increased $1,000,000 to the amount
of $6,000,000. The Company will utilize this facility to help finance its
interim needs in the coming year. Current financial resources and
anticipated funds from operations are expected to be adequate to meet
requirements for funds in the year ahead.

Impact of Inflation.
Inflation has not had a significant long-term impact on earnings. In the
event of significant inflation, the Company's efforts to cover cost increases
would be hampered as a result of the competitive nature of the products.

Item 8. Financial Statements and Supplementary Data.
Financial statements and supplementary financial information required to be
filed hereunder may be located through the List of Financial Statements and
Schedules attached to this report.

Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosures.
Not applicable.


PART III


Item 10. Directors and Executive Officers of the Registrant.

Information with respect to the names, ages, positions with the Company,
terms of office, periods of service, business experience, and other
directorships of the Company's Directors and Executive Officers is
incorporated herein by reference to Item 1A of the report and to the
Definitive Proxy Statement (under the caption "Election of Directors").


Item 11. Executive Compensation.

The information required in Item 11 is contained in the Definitive Proxy
Statement (under the caption "Executive Compensation"). Such information is
incorporated herein by reference.


Item 12. Security Ownership of Certain Beneficial Owners and Management.

Information regarding the ownership of the Company's common stock by
certain beneficial owners and by management is incorporated herein by
reference to the Definitive Proxy Statement under the captions "Principal
Holders of Voting Securities" and "Election of Directors."


Item 13. Certain Relationships and Related Transactions.

Information regarding certain relationships and related transactions with
the Company's Directors and Executive Officers is incorporated herein by
reference to the Definitive Proxy Statement under the captions "Election of
Directors" and "Remuneration of Directors and Executive Officers."




PART IV

Item 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K.

See the List of Financial Statements and Schedules included in this report
for a list of the financial statements and schedules included with this
report and see the Exhibit Index included in this report for a list of the
exhibits required to be filed with this report. The Company did not file any
reports on Form 8K during the fourth quarter of its most recent fiscal year.
Copies of any of the exhibits are available to beneficial shareholders as of
the record date (December 1, 1996) without charge upon written request to the
Investor Relations Department, Chase Corporation, 50 Braintree Hill Park,
Braintree, Massachusetts 02184.


SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

CHASE CORPORATION
Date



By /s/ Peter R. Chase President and November 22, 1996
Peter R. Chase Chief Executive Officer



Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.



Capacity Date
By /s/ Peter R. Chase President, Chief November 22, 1996
Peter R. Chase Executive Officer and
Director (Principal
Executive Officer)



By /s/ Everett Chadwick, Jr. Treasurer and Chief November 22, 1996
Everett Chadwick, Jr. Financial Officer
(Principal Financial
and Accounting Officer)



By /s/ Edward L. Chase Director November 22, 1996
Edward L. Chase



By /s/ William H. Dykstra Director November 22, 1996
William H. Dykstra



By /s/ George M. Hughes Director November 22, 1996
George M. Hughes



By /s/ Ronald Levy Director November 22, 1996
Ronald Levy



By /s/ Ernest E. Siegfriedt, Jr. Director November 22, 1996
Ernest E. Siegfriedt, Jr.


EXHIBIT INDEX

Exhibit
Number
Description

3.1 Articles of Organization (incorporated by reference from Exhibit 3 to
the Company's annual report on Form 10-K for the fiscal year ended
August 31, 1988)

3.2 By-Laws (incorporated by reference from Exhibit 3 to the Company's
annual report on Form 10-K for the fiscal year ended August 31, 1988)

3.3 Amendment to By-Laws (adding Article IV, Section 7) (incorporated by
reference from Exhibit 3.3 to the Company's annual report on Form 10-K
for the fiscal year ended August 31, 1990)

10.1 Split Dollar Insurance Agreement dated December 2, 1983 by and between
the Company and Edward L. Chase (incorporated by reference from Exhibit
10.1 to the Company's annual report on Form 10-K for the fiscal year
ended August 31, 1990)

10.2 Split Dollar Insurance Agreement dated December 2, 1983 by and between
the Company and Francis M. Chase (incorporated by reference from Exhibit
10.2 to the Company's annual report on Form 10-K for the fiscal year
ended August 31, 1990)

10.3 Edward L. Chase Consulting and Non-Compete Agreement (incorporated by
reference from Exhibit 10.3 to the Company's annual report on Form 10-K
for the fiscal year ended August 31, 1986)

10.6 Edward L. Chase Retirement and Succession Agreement (incorporated by
reference from Exhibit 10.6 to the Company's annual report on Form 10-K
for the fiscal year ended August 31, 1988)

10.9 Edward L. Chase Right of First Refusal (incorporated by reference from
Exhibit 10.9 to the Company's annual report on Form 10-K for the fiscal
year ended August 31, 1988)

10.11 Purchase and Sale Agreement dated October 26, 1990 by and between the
Company and Avon Custom Mixing Service, Inc. (incorporated by reference
from Exhibit 2.1 to the Company's Current Report on Form 8-K dated
October 26, 1990)

10.14 Amendment dated August 7, 1990 to Edward L. Chase Retirement and
Succession Agreement (incorporated by reference from Exhibit 10.14 to
the Company's annual report on Form 10-K for the fiscal year ended
August 31, 1990)

10.17 Amendment dated April 30, 1992 to Split Dollar Insurance Agreement dated
December 2, 1983 by and between the Company and Edward L. Chase
(incorporated by reference from Exhibit 10.17 to the Company's annual
report on Form 10-K for the fiscal year ended August 31, 1992)

10.18 Amendment dated April 30, 1992 to Split Dollar Insurance Agreement dated
November 10, 1987 by and between the Company and Edward L. Chase and
Claire Chase (incorporated by reference from Exhibit 10.18 to the
Company's annual report on Form 10-K for the fiscal year ended August
31, 1992)

10.19 Amendment dated April 30, 1992 to Edward L. Chase Consulting and Non-
Compete Agreement dated January 17, 1986 (incorporated by reference from
Exhibit 10.19 to the Company's annual report on Form 10-K for the fiscal
year ended August 31, 1992)

10.20 Amendment dated August 31, 1992 to Split Dollar Insurance Agreement
dated December 2, 1983 by and between the Company and Francis M. Chase
(incorporated by reference from Exhibit 10.20 to the Company's annual
report on Form 10-K for the fiscal year ended August 31, 1992)

10.21 Amendment dated August 31, 1992 to Split Dollar Insurance Agreement
dated November 10, 1987 by and between the Company and Francis M. Chase
and Barbara Chase (incorporated by reference from Exhibit 10.21 to the
Company's annual report on Form 10-K for the fiscal year ended August
31, 1992)

10.23 Stock Redemption Agreement dated July 18, 1995 by and between the
Company and Francis M. Chase (incorporated by reference from Exhibit
99.1 to the Company's Current Report on Form 8-K dated July 18, 1995)

10.24 Amendment dated July 18, 1995 terminating the Consulting and Non-Compete
Agreement by and between the Company and Francis M. Chase.

22 Subsidiaries of the Company (incorporated by reference from Exhibit 22
to the Company's annual report on Form 10-K for the fiscal year ended
August 31, 1989)

List of Financial Statements and Schedules

Report of Independent Certified Public Accountants.................... 13

Consolidated Balance Sheets as of August 31, 1996 and
August 31, 1995................................................. 14

Consolidated Statements of Operations for each of the three
fiscal years in the period ended August 31, 1996................ 16

Consolidated Statements of Shareholders' Equity for each of
the three fiscal years in the period ended August 31, 1996...... 17

Consolidated Statements of Cash Flows for each of the three
fiscal years in the period ended August 31, 1996................ 18

Notes to Consolidated Financial Statements........................... 19

Schedules:

VIII-Valuation and Qualifying Accounts and Reserves......... 33








INDEPENDENT AUDITORS' REPORT



To the Shareholders and Board of Directors
Chase Corporation
Braintree, Massachusetts


We have audited the consolidated balance sheets of Chase Corporation and
subsidiary as of August 31, 1996 and 1995, and the related consolidated
statements of operations, shareholders' equity and cash flows for each year in
the three year period ended August 31, 1996 and the schedule VIII, Valuation
and Qualifying Accounts and Reserves. These financial statements and schedule
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements and schedule based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Chase
Corporation and subsidiary at August 31, 1996 and 1995, and the consolidated
results of their operations and cash flows for each year in the three year
period ended August 31, 1996, in conformity with generally accepted accounting
principles, and the schedule referred to above presents fairly, in all material
respects, when read in conjunction with the related financial statements, the
information therein set forth.



/s/ LIVINGSTON & HAYNES, P.C.
Wellesley Hills, Massachusetts
October 16, 1996



CHASE CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

AUGUST 31, 1996 AND 1995



ASSETS

1996 1995

CURRENT ASSETS
Cash $ 191,429 $ 108,587
Trade receivables, less allowance for doubtful
accounts of $127,500 and $95,500, at August 31,
1996 and 1995, respectively 5,770,152 5,808,641
Inventories:
Finished and in process 1,073,226 1,647,181
Raw materials 2,599,427 3,145,151
3,672,653 4,792,332

Prepaid expenses 104,862 302,191
Other current assets 167,764 100,583
Note receivable from related parties,
current portion 208,966 207,166
Deferred income taxes 148,886 179,886

TOTAL CURRENT ASSETS 10,264,712 11,499,386

PROPERTY, PLANT AND EQUIPMENT
Land and improvements 322,423 384,490
Buildings 1,758,538 2,455,077
Machinery and equipment 9,839,816 9,568,270
Construction in progress 4,639 44,346
11,925,416 12,452,183
Less allowances for depreciation 7,741,587 7,733,414
4,183,829 4,718,769

OTHER ASSETS
Excess of cost over net assets of acquired
businesses, less amortization 80,080 85,337
Patents, agreements and trademarks, less
amortization 1,237,160 1,335,822
Cash surrender value of life insurance, net of
loans of $158,049 at August 31, 1996 and 1995 1,658,288 1,397,822
Deferred income taxes 18,978 58,205
Note receivable from related parties 309,042 517,975
Investments in minority interests 2,027,735 382,270
Other 7,000 7,000
5,338,283 3,784,431

$19,786,824 $20,002,586
=========== ===========

See accompanying notes to the consolidated financial statements.




LIABILITIES AND SHAREHOLDERS' EQUITY

1996 1995

CURRENT LIABILITIES
Accounts payable $ 2,370,616 $ 2,911,293
Note payable to bank - 81,851
Accrued payroll and other compensation 837,989 803,642
Accrued pension expense - current 389,322 384,556
Other accrued expenses 1,211,729 831,418
Federal taxes payable 67,261 (42,510)
Deferred compensation 302,216 302,216
Current portion of long-term debt 1,223,178 1,208,726

TOTAL CURRENT LIABILITIES 6,402,311 6,481,192

LONG-TERM DEBT, less current portion 4,481,071 6,464,260

DEFERRED COMPENSATION 217,539 367,950

ACCRUED PENSION EXPENSE 227,968 284,832

COMMITMENTS (See Note G) - -

CONTINGENCIES (See Note L) - -

SHAREHOLDERS' EQUITY
First Serial Preferred Stock,
par value $1.00 a share:
Authorized 100,000 shares; none issued - -
Common Stock, par value $.10 a share:
Authorized 10,000,000 shares;
issued and outstanding 4,676,397 and
4,459,848 shares at August 31, 1996
and 1995, respectively 467,640 445,985
Additional paid-in capital 2,815,216 2,674,897
Treasury Stock, 1,037,693 shares of Common
Stock at August 31, 1996 and 1995 (3,990,400) (3,990,400)
Cumulative effect of currency translation (108,100) (79,030)
Retained earnings 9,273,579 7,352,900
8,457,935 6,404,352

$19,786,824 $20,002,586
=========== ===========







CHASE CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



1996 1995 1994

Revenue:
Sales $33,948,292 $32,332,541 $28,090,221
Commissions and other income 349,103 345,898 524,619
Interest 68,634 56,454 39,581
34,366,029 32,734,893 28,654,421

Costs and expenses:
Costs of products and services sold 22,695,744 21,957,684 18,716,114
Selling, general and administrative
expenses 7,590,223 7,274,612 6,890,894
Bad debt expense 42,731 23,815 126,568
Interest expense 594,746 396,020 223,321
30,923,444 29,652,131 25,956,897

INCOME FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 3,442,585 3,082,762 2,697,524

Income taxes 1,247,600 1,174,878 1,088,903

INCOME FROM OPERATIONS 2,194,985 1,907,884 1,608,621

Equity in earnings of unconsolidated
joint venture 82,965 19,951 -

NET INCOME $ 2,277,950 $ 1,927,835 $ 1,608,621
=========== =========== ===========


Income from operations
per share of Common Stock
Primary $ .58 $ .43 $ .36
===== ===== =====
Fully diluted $ .58 $ .42 $ .35
===== ===== =====


Net income per share of Common Stock
Primary $ .61 $ .43 $ .36
===== ===== =====
Fully diluted $ .61 $ .43 $ .35
===== ===== =====


See accompanying notes to the consolidated financial statements.






CHASE CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996
CUMULATIVE
ADDITIONAL EFFECT OF
COMMON STOCK PAID-IN TREASURY STOCK RETAINED CURRENCY SHAREHOLDERS'
SHARES AMOUNT CAPITAL SHARES AMOUNT EARNINGS TRANSLATION EQUITY

Balance at August 31,
1993 4,258,348 $425,835 $2,408,313 - $ - $4,422,573 $ (85,458) $7,171,263
Cash dividend paid,
$0.06 per share - - - - - (255,501) - (255,501)
Currency translation
adjustment - - - - - - (31,471) (31,471)
Exercise of stock
option 104,500 10,450 147,345 - - - - 157,795
Net income - - - - - 1,608,621 - 1,608,621
Balance at August 31,
1994 4,362,848 436,285 2,555,658 - - 5,775,693 (116,929) 8,650,707
Cash dividend paid,
$0.08 per share - - - - - (350,628) - (350,628)
Currency translation
adjustment - - - - - - 37,899 37,899
Exercise of stock
options 97,000 9,700 210,770 - - - - 220,470
Purchase of Treasury
Stock - - - 1,302,693 (5,009,431) - - (5,009,431)
Sale of Treasury Stock - - (91,531) (265,000) 1,019,031 - - 927,500
Net income - - - - - 1,927,835 - 1,927,835
Balance at August 31,
1995 4,459,848 445,985 2,674,897 1,037,693 (3,990,400) 7,352,900 (79,030) 6,404,352
Cash dividend paid,
$0.10 per share - - - - - (357,271) - (357,271)
Currency translation
adjustment - - - - - - (29,070) (29,070)
Compensatory stock
issuance 150,000 15,000 56,250 - - - - 71,250
Exercise of stock
options 66,549 6,655 84,069 - - - - 90,724
Net income - - - - - 2,277,950 - 2,277,950
Balance at August 31,
1996 4,676,397 $467,640 $2,815,216 1,037,693 $(3,990,400)$9,273,579 $(108,100) $8,457,935
========= ======== ========== ========= =========== ========== ========= ==========

See accompanying notes to the consolidated financial statements.





CHASE CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996

1996 1995 1994

CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 2,277,950 $ 1,927,835 $1,608,621
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 775,571 741,869 679,138
Amortization 103,921 104,027 31,971
(Gain) on sale of assets (40,000) - (100,239)
Stock issued for compensation 56,250 - -
Increase (decrease) in provision
for losses on trade receivables 32,000 (5,000) 25,500
Tax effect of cashless option exercise 105,724 - -
Deferred federal tax 70,227 251,463 122,000
Change in assets and liabilities:
Trade receivables 6,489 (1,461,697) 178,310
Inventories 1,119,679 (1,000,449) 54,088
Prepaid expenses 197,329 (233,215) 862
Other current assets (67,181) 16,098 (73,394)
Other assets - 4,027 3,454
Accounts payable (540,677) 746,740 (49,794)
Accrued expenses 362,560 157,535 509,043
Federal taxes payable 109,771 (202,116) 119,087
Deferred compensation (150,411) (889,801) (286,220)
TOTAL ADJUSTMENTS 2,141,252 (1,770,519) 1,213,806
NET CASH FROM OPERATIONS 4,419,202 157,316 2,822,427

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds of note receivable 207,133 131,153 119,326
Proceeds of asset sales 122,649 - 4,500
Capital expenditures including patents
and agreements (323,282) (602,479) (1,697,918)
Cumulative effect of currency translati on (29,070) 37,899 (31,471)
(Increase) decrease in net cash surrender
value (260,466) 828,371 (163,769)
Investments in minority interests (1,645,465) (382,271) -
Note received from joint venture - (362,319) -
Mortgage payments received - - 2,100
(1,928,501) (349,646) (1,767,232)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in long-term debt 4,300,000 11,935,09 6,941,000
Payments of principal on debt (6,268,737) (7,714,985) (7,682,904)
Net borrowing under line-of-credit (81,851) 81,851 (41,690)
Cash dividends paid (357,271) (350,628) (255,501)
Cash received on options exercise - 220,470 157,795
Purchase of Common Shares for Treasury - (5,009,431) -
Sale of Common Shares from Treasury - 927,500 -
(2,407,859) 89,876 (881,300)
NET CHANGE IN CASH 82,842 (102,454) 173,895
CASH AT BEGINNING OF YEAR 108,587 211,041 37,146

CASH AT END OF YEAR $ 191,429 $ 108,587 $ 211,041
=========== =========== ==========
See Note M for supplemental cash flow data.

See accompanying notes to the consolidated financial statements.



CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE A - ACCOUNTING POLICIES

The principal accounting policies of Chase Corporation ("the Company")
and its subsidiary are as follows:

Basis of Presentation

The financial statements include the accounts of the Company and its
foreign sales corporation subsidiary. Investments in unconsolidated companies
which are at least 20% owned are carried at cost plus equity in undistributed
earnings since acquisition. All significant intercompany transactions and
balances have been eliminated in consolidation. The Company uses the U.S.
dollar as the functional currency for financial reporting.

Products and Markets

The Company's principal products are protective coatings and tape
products that are sold in national and international markets. These products
consist of: (i) insulating and conducting materials for the manufacture of
electrical and telephone wire and cable, and electrical splicing, terminating
and repair tapes which are marketed to wire and cable manufacturers and public
utilities; (ii) protective pipe coating tapes and other protectants for valves,
regulators, casings, joints, metals, concrete, and wood that are sold to oil
companies, gas utilities and pipeline companies; (iii) protectants for highway
bridge deck metal surfaces which are sold to municipal transportation
authorities; (iv) thermo-electric insulation for transformers, motors, and
other electrical equipment that are sold to original equipment manufacturers,
and (v) moisture protective coatings that are sold to the electronics industry.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Cash

For the purpose of the statement of cash flows, the Company considers
all highly liquid debt instruments purchased with a maturity of three months
or less to be cash equivalents.

Inventories

Inventories are stated at first-in, first-out cost, which is not in
excess of market.

Investment in Minority Interests

The Company makes investments in closely held companies. These
investments are recorded on the equity method reflecting the Company's original
investment and a proportional interest in the net operations of these companies
since no public quotations exist for these investments.






CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE A - ACCOUNTING POLICIES


Property, Plant and Equipment

These assets are reflected at cost. Provisions for depreciation of
property, plant and equipment were computed by both straight-line and
accelerated methods.

Expenditures for maintenance repairs and minor renewals have been
charged to expense as incurred. Betterments and major renewals have been
capitalized. Upon retirement or other disposition of assets, related
allowances for depreciation and amortization have been eliminated from the
accounts and any resulting profit or loss reflected in consolidated net
income. The annual provisions for depreciation have been computed
principally in accordance with the following range of rates:

Buildings - 4% to 7%
Machinery and equipment - 10% to 20%


Excess of Cost Over Net Assets of Acquired Businesses

The excess of cost over the fair value of net assets of acquired
businesses is being amortized over forty years or until the disposal of the
acquired business.

Patents and Agreements

Patents and agreements are stated at cost and are being amortized over
periods of fifteen, seventeen and twenty years.


Pension Plan

The projected unit credit method is utilized for measuring net periodic
pension cost over the employee's service life.

Deferred Compensation

The net present value of the estimated payments to be made under
agreements for deferred compensation is accrued over the period of active
employment from the time of the agreement to the anticipated date of retirement.

Translation of Foreign Currency

The financial position and results of operations of the Company's
Canadian branch are measured using the Canadian dollar as the functional
currency. Revenues and expenses of the branch have been translated at average
exchange rates. Assets and liabilities have been translated at the year-end
exchange rate. Translation gains and losses are being deferred as a separate
component of shareholders' equity, unless there is a sale or liquidation of the
underlying foreign investments. The Company has no present plans for the
sale or liquidation of its foreign investment. Aggregate foreign currency
transaction gains and losses are included in determining net income ($5,952
loss for the year ended August 31, 1996).






CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE A - ACCOUNTING POLICIES (Continued)


Income Taxes

The Company has adopted the method of accounting for income taxes of
SFAS No. 109. This method compares the tax basis and financial reporting basis
of the Company's assets and liabilities and recognizes the related tax benefits
and liabilities under enacted tax law. Assets arising from future tax benefits
are recognized when it is more likely than not that the Company will have
sufficient future taxable income or has had sufficient taxable income in the
available carryback period to allow realization of the tax asset. A valuation
allowance is provided for potential limitations on the realization of future
benefits.

Income Per Share of Common Stock

Income per share is computed based upon the weighted average number of
shares outstanding, after giving effect to the number of shares purchased for
Treasury and the dilutive effect of potential stock options. The number of
shares used in the computation of primary income per share as restated was
3,759,467 at August 31, 1996, 4,474,854 at August 31, 1995 and 4,519,013 at
August 31, 1994. Fully diluted income per share was computed based upon
3,765,913 shares at August 31, 1996, 4,490,413 shares at August 31, 1995 and
4,544,623 shares at August 31, 1994.


NOTE B - NOTE RECEIVABLE

The Company has advanced $362,319 to Stewart Group, Inc. of which it is
a forty-two percent shareholder (see Note N), with an annual payment of
CAN $100,000 and interest at Royal Bank of Canada prime rate.

The Company has a note receivable from Avon Custom Mixing Service, Inc.,
the purchaser of its Avon Custom Mixing Division, secured by the assets of the
purchaser. Effective May 1993, the note provides for monthly payments of
$8,333 with interest payable at First National Bank of Boston base rate
(8.25% at August 31, 1996).



NOTE C - CASH SURRENDER VALUE OF LIFE INSURANCE

The Company recognizes cash surrender value in life insurance policies,
net of loans secured by the policies, with Aurora National Life Assurance
Company, the Manufacturers' Life Insurance Company, Sun Life Assurance
Company of Canada and Metropolitan Life Insurance of $599,393; $800,872;
$106,468; and $151,555, respectively. Subject to periodic review, the
Company intends to maintain these policies through the lives of the insureds.

CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996




NOTE D - LONG-TERM DEBT

Long-term debt consists of the following at August 31, 1996 and 1995:

1996 1995

Note payable to bank with payments of interest
only through March 1, 1998 at LIBOR plus two
percent, currently at 7.59%. A single
principal payment is due March 1, 1998 with
prepayments allowed at the Company's option.
The note is secured by all assets. $2,400,000 $3,000,000

Note payable to bank in quarterly installments
of $160,000 through July 2000 with interest
at LIBOR plus two percent, currently at
7.5%. The note is secured by all assets. 2,400,000 3,200,000

Capitalized lease obligation with monthly
payments of $15,418, including interest at
7.514% through May 1999, secured by
production equipment with a cost of $897,000
and accumulated depreciation of $134,550. 445,830 591,365

Capitalized lease obligation with monthly
payments of $2,539, including interest at
6.85% through August 1998, secured by
production equipment with a cost of $130,335
and accumulated depreciation of $32,584. 54,581 80,344

Term note payable to bank with principal
payments of $125,000 per quarter with
interest at LIBOR plus two and a quarter
percent, currently at 7.75%. The note
is secured by all assets. 375,000 750,000

Capitalized lease obligation with monthly
payments of $1,988, including interest at
7.602% through November 1997, secured by
a computer with a cost of $99,590 and
accumulated depreciation of $69,713. 26,550 47,513

Capitalized lease obligation with monthly
payments of $142, including interest at
7.44% through February 1998, secured by
computer peripheral equipment with a cost
of $7,150 and accumulated depreciation
of $5,005. 2,288 3,764
5,704,249 7,672,986
Less portion payable within one year
classified as a current liability. 1,223,178 1,208,726

$4,481,071 $6,464,260
========== ==========








CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE D - LONG-TERM DEBT (Continued)

The Company has long-term credit available up to a maximum amount of
$5,000,000 at the bank's base lending rate or, at the option of the Company, at
the effective London Interbank Offered Rate (LIBOR) for ninety days plus two
percent. The line of credit is secured by all assets and is limited to 50% of
inventory and 80% of current receivables. The Company had net borrowings of
$2,400,000 and $3,000,000 under the credit agreement at August 31, 1996 and
1995, respectively. The unused available long-term credit amounted to
$2,440,120 at August 31, 1996. Effective September 11, 1996, the Company's
maximum credit availability was increased to $6,000,000.


NOTE E - NOTE PAYABLE TO BANK

The Company has a short-term credit facility at one half percent over
prime with a Canadian bank secured by a letter of credit.


NOTE F - INCOME TAXES

A reconciliation of federal income taxes computed at applicable rates of
income from continuing operations before income taxes to the amounts provided in
the consolidated financial statements is as follows:



Year Ended August 31,
1996 1995 1994

Federal income taxes at applicable
rates $1,170,479 $1,048,139 $ 944,133

Adjustments resulting from the tax
effect of:
Increase in cash surrender value
of life insurance (120,625) (116,384) (106,783)
Benefit plans not qualified for
deduction from federal tax 121,060 108,678 98,195
Compensation deduction allowed
for stock option exercise - - (36,209)
State and local taxes net of
federal tax effect 151,314 167,239 175,625

Other (74,628) (32,794) 13,942

INCOME TAXES $1,247,600 $1,174,878 $1,088,903
========== ========== ==========




CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE F - INCOME TAXES (Continued)


Year Ended August 31,
1996 1995 1994


Current $1,283,097 $ 923,415 $ 966,903
Deferred (benefit):
Pension expense 20,819 36,345 (48,943)
Depreciation 14,427 (96,957) 44,765
Allowance for doubtful accounts (12,800) 2,000 (10,200)
Deferred compensation 59,781 338,617 149,442
Deferred state taxes - 24,000 (24,800)
Reserve (12,000) (52,542) 11,736
Total Deferred 70,227 251,463 122,000
(Benefit) of option exercises
credited to shareholders' equity (105,724) - -

$1,247,600 $1,174,878 $1,088,903
========== ========== ==========

The timing differences that give rise to the components of net tax
assets are as follows at August 31, 1996 and 1995:


1996 1995

Assets:
Reserve for bad debt $ 51,000 $ 38,200
Patents and agreements 38,761 38,761
Pension accrual 246,916 267,735
State tax accrual 20,800 20,800
Deferred compensation 207,902 267,683
565,379 633,179
Less valuation allowance 44,000 56,000
--------- --------
521,379 577,179
Liabilities:
Depreciation 353,515 339,088
--------- --------
Net Assets $ 167,864 $ 238,091
========== ==========

NOTE G - OPERATING LEASES

The following is a schedule for the next five years of future minimum
rental payments required under operating leases that have initial or remaining
noncancellable lease terms in excess of one year as of August 31, 1996:



Year Ending August 31, Buildings


1997 $215,425
1998 163,024
1999 147,191
2000 68,024
2001 68,024

$661,688
========




CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE G - OPERATING LEASES (Continued)

Total rental expense for all operating leases amounted to $353,265,
$340,068, and $348,260 for the years ended August 31, 1996, 1995 and 1994,
respectively.


NOTE H - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

Selected unaudited quarterly financial data for 1996, 1995 and 1994, is
as follows:



Quarter
1996 First Second Third Fourth Year


Net sales $8,232,459 $7,664,955 $8,673,573 $9,377,305 $33,948,292
Gross profit $2,604,003 $2,362,980 $2,792,048 $3,493,517 $11,252,548
Net income $507,440 $374,561 $511,139 $884,810 $2,277,950

Net income per
common share $.14 $.10 $.14 $.23 $.61
==== ==== ==== ==== ====


Quarter
1995 First Second Third Fourth Year

Net sales $7,833,974 $7,289,315 $8,694,676 $8,514,576 $32,332,541
Gross profit $2,671,974 $2,265,740 $2,587,647 $2,849,496 $10,374,857
Net income $553,384 $352,651 $395,467 $626,333 $1,927,835

Net income per
common share $.12 $.08 $.09 $.14 $.43
==== ==== ==== ==== ====

Quarter
1994 First Second Third Fourth Year

Net sales $7,259,166 $6,286,423 $7,075,756 $7,468,876 $28,090,221
Gross profit $2,472,460 $2,047,550 $2,321,112 $2,532,985 $9,374,107
Net income $459,623 $295,992 $342,105 $510,901 $1,608,621

Net income per
common share $.11 $.07 $.08 $.09 $.35
==== ==== ==== ==== ====




CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE I - EXPORT SALES AND FOREIGN OPERATIONS

Export sales from continuing domestic operations to unaffiliated third
parties were $3,594,317, $2,764,170 and $2,486,448 for the years ended
August 31, 1996, 1995 and 1994, respectively. The Company's products are
sold world-wide with no foreign geographic area accounting for more than 10
percent of revenues from continuing operations. The Company's Canadian
operations accounted for 6.3 percent of consolidated sales and 8.3 percent of
assets.


NOTE J - RESEARCH AND DEVELOPMENT EXPENSE

Research and development expense amounted to approximately $501,964,
$511,355, and $593,536 for the years ended August 31, 1996, 1995 and 1994,
respectively.


NOTE K - BENEFITS

401(K) Plan

The Company has a deferred compensation plan adopted pursuant to Section
401(k) of the Internal Revenue Code of 1986. Any qualified employee who has
attained age 21 and has been employed by the Company for at least six months
may contribute a portion of their salary to the plan and the Company will
match 50% of such contribution up to an amount equal to three percent of such
employee's yearly salary.

Pension Plan

The Company has non-contributory defined benefit pension plans covering
substantially all employees. Total pension expense, including the net periodic
pension cost and the effects of settlements, was $332,458, $275,188 and
$370,383 for the years ended August 31, 1996, 1995 and 1994, respectively.
The Company has a funded, qualified plan and an unfunded supplemental
retirement plan designed to maintain benefits for all employees at the plan
formula level.



CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE K - BENEFITS (Continued)



Net pension expense components: Year Ended August 31,
1996 1995 1994

Service cost of benefits earned
during the period $196,790 $164,024 $143,626

Interest cost on projected benefit
obligations 255,690 200,022 189,163

Return on plan assets (200,988) (184,866) (114,267)

Net amortization and deferral 80,966 96,008 24,714

Net periodic pension cost before
settlement costs $332,458 $275,188 $243,236
======== ======== ========


The following table sets forth the actuarial present value of benefit
obligations and funded status:



August 31,
1996 1995 1994

Accumulated benefit obligations,
including vested benefits of
$2,138,788, $1,903,479 and
$1,663,789 at August 31, 1996,
1995 and 1994, respectively $ 2,182,250 $ 1,935,313 $ 1,691,600
=========== =========== ===========

Projected benefit obligations $(3,552,626) $(3,336,642) $(2,586,305)

Plan assets at fair value,
including prefunded amounts 2,215,085 1,778,327 1,295,959
=========== =========== ===========
Funded status (1,337,541) (1,558,315) (1,290,346)

Unrecognized net loss 461,280 612,884 544,935

Unrecognized prior service cost 286,965 311,036 27,203

Unamortized net transition assets (27,994) (34,993) (41,992)
=========== =========== ===========
(Accrued) pension expense $ (617,290) $ (669,388) $ (760,200)
=========== =========== ===========







CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996


NOTE K - BENEFITS (Continued)

The net transition assets amount is being amortized at a level rate over
15 years. The actuarial calculations were based on assumptions of a weighted
average discount rate of 8.0% and a future rate of increase in compensation
levels of 5%. The expected rate of return on plan assets is 10%. Prior
service cost arose from the amendment of the plan's benefit schedules to
comply with the Tax Reform Act of 1986 (TRA) and adoption of the unfunded
supplemental pension plan.

The pension plan recorded net losses on settlement of $127,147 during
the year ended August 31, 1994. The settlement occurred due to lump sum
retirement payments exceeding the amount of the pension obligation arising
from the service cost and interest cost components of the net periodic
pension cost.

Deferred Compensation

The Company has deferred compensation agreements with a former officer
providing for post retirement health benefits and annual payments of $200,000
for the officer through August 31, 1998.

Additionally, life insurance is provided under a split dollar life
insurance agreement whereby the Company will recover the premiums paid from the
proceeds of the policies. The Company recognizes an offset to expense for the
growth in the cash surrender value of the policies.

The Company also has an agreement with its former Chairman of the Board,
who retired August 31, 1991, that the Company will make ten annual payments of
$58,000 to him or his beneficiaries.


Stock Option Plans

1989 Non-Statutory Plan - Options to purchase 612,000 shares of Common
Stock were granted to officers, senior employees, and independent directors.
Options on 156,000 shares of Common Stock are currently outstanding. The
options are exercisable at the fair market value of the shares at the date of
grant adjusted for stock dividends. Directors' options vest ratably over a
two year period and officer and employee options vest over a four year
period. All options are fully vested. The options expire seven years from
the date of grant, one year after ceasing to be a director, or at various
times up to six months after termination as an employee. Options on 93,500
and 97,000 shares were exercised during the years ended August 31, 1996
and 1995, respectively.

1995 Stock Option Plan - Effective July 18, 1995, the Company adopted,
subject to stockholder approval, a stock award plan and an incentive plan which
permit the issuance of options and restricted stock to selected employees of
the Company. The plans reserve 600,000 shares of Common Stock for grant.

Under the terms of the 1995 stock option plan, options granted may be
either nonqualified or incentive stock options and the exercise price may not
be less than the fair market value of a share at the date of grant. The
board of directors approved issuance of 450,000 options (at $3.375, based
upon the market value at July 18, 1995). The options vest ratably over ten
years. In addition, the board of directors granted 150,000 shares of
restricted Common Stock to the Company's CEO, Mr. Peter Chase, at no cost.
Other than the restrictions which limit the sale and transfer of these
shares, Mr. Chase is entitled to all rights of a shareholder. The grant
includes provisions for a future grant of 100,000 shares. The grants vest at
the end of nine years. If Mr. Chase is not providing services to the Company
prior to vesting, the shares revert to the Company.

CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE K - BENEFITS (Continued)



Stock Option Plans (Continued)
Officers and
Directors Employees

August 31, 1994
Issued and outstanding 154,000 192,500
Exercisable 154,000 192,500
Exercise price per share $1.24 - $1.43 $1.51

August 31, 1995
Issued and outstanding 77,000 622,500
Exercisable 77,000 172,500
Exercise price per share $1.24 - $1.43 $3.50

August 31, 1996
Issued and outstanding 128,500 540,000
Exercisable 70,165 120,000
Exercise price per share $1.24 - $1.375 $1.51- $3.375

Options exercisable and exercise prices are shown after adjustment for
10% stock dividend issued June 1, 1990.




Stock option plan activity was as follows:
Officers and
Directors Employees


Outstanding August 31, 1994 154,000 192,500

Grants (1995 stock option plan) - 450,000
Exercises (77,000) (20,000)

Outstanding August 31, 1995 77,000 622,500

Grants (1995 stock option plan) 62,500 -
Exercises (11,000) (82,500)

Outstanding August 31, 1996 128,500 540,000
======= ========



CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE L - CONTINGENCIES

Environmental

The Company is aware of potential claims concerning a site in Bruin,
Pennsylvania where an affiliate of the Company had sponsored research into
experimental oil and coal-based fuels in the early 1980s. In August 1991, a
spill of the affiliate's stored material occurred at the Bruin site, apparently
due to vandalism of the storage tanks. Upon learning of the spill, the Company
provided notice of the release to appropriate authorities and undertook to
remedy the spill. The remedy was completed in October 1992 under plans
approved by the Pennsylvania Department of Environmental Protection
("Pennsylvania DEP"). The Company believes that this work terminated its
liabilities for the spill, but Pennsylvania DEP has not provided a final
release.

The Bruin site had been used for many years for a variety of oil
refining operations by unrelated parties. The site has significant
contamination from those unrelated activities. Since the spill of the
material remedied by the Company, the U.S. Environmental Protection Agency
has conducted an investigation of the site, conducted emergency clean-up
activities at the site focused on materials other than the affiliate's
material and spill, and turned responsibility for the site back to
Pennsylvania DEP. To date, EPA has not made any claim against the Company.

During 1993 to 1995, Pennsylvania DEP has conducted an investigation of
the site, has completed a surface cleanup, and has proposed a permanent
remedy. Pennsylvania DEP has notified the Company that it may be a person
responsible under Pennsylvania law to contribute to the costs of those
activities. During 1995, Pennsylvania DEP suggested that the Company
contribute an amount toward the costs of the investigation and the surface
cleanup in an attempt to settle with the Company. On July 18, 1996, the
Pennsylvania DEP sent a settlement proposal to Chase requesting a payment of
$335,000 to resolve all of Chase's potential liabilities to the State of
Pennsylvania at the Bruin site. While the amount proposed is not deemed
material, the Company still believes that the work previously performed to
remedy the spill terminated its liabilities and therefore declined the
proposal.

The Company remains in communication with Pennsylvania DEP, and expects
that it will eventually determine that the Company resolved any potential
liability at the site by its response to the 1991 spill.

Legal

The Company has been named as a third-party defendant in eighteen
personal injury lawsuits filed in state court in Jackson County, Mississippi.
These lawsuits, each of which has multiple plaintiffs and defendants, arose out
of alleged asbestos exposure by the plaintiffs as a result of their work at the
Ingalls Shipyard. The Company was sued as a third-party defendant by USX
Corporation, General Cable Corporation and G. K. Technologies, Inc., each of
whom is a primary defendant in these actions. USX, General Cable and G.K. are
alleged to have supplied wire and cable products containing asbestos to the
shipyard. The third-party complaints allege that tape products containing
asbestos were manufactured by the Company, sold to USX, General Cable and G.K.,
and then incorporated in their wire and cable products sold for use in the
ships. USX, General Cable and G.K. are seeking indemnification from the
Company for damages that may be assessed against them and expenses including
legal fees.





CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE L - CONTINGENCIES (Continued)

Legal (Continued)


The third-party claims against the Company, along with all other
third-party and crossclaims, were severed from the trial of the primary
actions. USX, General Cable and G.K. were each dismissed by the plaintiffs
prior to the commencement of trial of nine of the primary actions, which took
place in the summer of 1993. It is not known how much, if anything, each paid
to settle these claims. To date, no effort has been made by USX, General
Cable and G.K. to pursue the third-party claims against the Company arising
out of the resolution of any of the cases tried in the summer of 1993. Some
of the remaining primary actions remain pending, but it is not now known when
those cases will be tried, whether the plaintiffs will proceed against any of
the wire and cable manufacturers, including USX, General Cable or G.K., and
whether any of these defendants will, in turn, pursue their claims against the
Company.

The Company's liability insurer has assumed defense of these claims
subject to reservation of its rights as to coverage for any underlying
liability assessed.

In July 1994 the Company received a notice letter from General Cable
and G.K. that they have been sued in fourteen additional asbestos personal
injury lawsuits, ten of which are pending in Mississippi, two in Pennsylvania
and two in Texas. Each of these cases involves multiple plaintiffs and
defendants. This notice letter is an effort to bind the Company to the
factual determination made in these cases, if General Cable or G.K. brings an
action against the Company for indemnification arising out of these cases. No
such action for indemnification has yet been brought and the Company is not
now a party in any of these fourteen additional cases. The Company's
liability insurer has been informed that the Company has been notified of
these potential claims.

The Company is investigating the defenses available to it in
connection with all these matters and its rights against its supplier.
Although the Company cannot predict whether any of these claims will be
pursued, management believes that such claims will not have any material
financial impact on the Company.








CHASE CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

FOR EACH YEAR IN THE THREE YEAR PERIOD ENDED AUGUST 31, 1996



NOTE M - SUPPLEMENTAL CASH FLOW DATA



Cash paid during the year for:

1996 1995 1994


Income taxes $855,000 $730,000 $630,690
Interest $594,746 $396,020 $223,322



The Company acquired production equipment valued at $903,415 under
capitalized leases during the year ended August 31, 1994.

During the year ended August 31, 1994, the Company sold the equipment
formerly leased to Avon Custom Mixing Service, Inc. for a note receivable,
with interest at bank base rate plus two percent, of $224,023. The equipment
had a cost of $1,496,392 and accumulated depreciation of $1,368,500.


NOTE N - INVESTMENT IN MINORITY INTERESTS

The Company has formed a joint venture, The Stewart Group, Inc., with
The Stewart Group, Ltd. of Canada, to produce various products for the fiber
optical cable market. Chase Corporation owned a 42% interest in the joint
venture at August 31, 1996.

The Company has invested in minority interests in various closely
held companies. Investments at August 31, 1996, in addition to The Stewart
Group, Inc., consist of a 20% interest in DC Scientific, Inc., an electronics
assembly company, 20% interest in Wireless, Inc., a telecommunications
marketing company and a 32% interest in webpa.com, an internet software
developer.


NOTE O - SALE OF AVON REAL ESTATE

During April 1996, the Company sold the real estate formerly leased
to Avon Custom Mixing Service, Inc. for $122,649 and recorded a gain on the
sale of $40,000. The assets sold consisted of land and buildings with a cost
of $835,488 and accumulated depreciation of $760,393, with expenses related to
the sale of $7,554.








SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

CHASE CORPORATION AND SUBSIDIARY

COL. A COL. B COL. C COL. D COL. E

BALANCE AT (1) (2) BALANCE AT
BEGINNING CHARGED TO COSTS CHARGED TO END OF
DESCRIPTION OF PERIOD AND EXPENSES OTHER ACCOUNTS DEDUCTIONS PERIOD



Year ended August 31, 1996:

Allowance for doubtful
accounts $95,500 $42,731 $ - $10,731 $127,500


Year ended August 31, 1995:

Allowance for doubtful
accounts $100,500 $23,815 $ - $28,815 $95,500


Year ended August 31, 1994:

Allowance for doubtful
accounts $75,000 $126,568 $ - $101,068 $100,500




Deductions are charged to accounts receivable when specific accounts are judged to be uncollectible.