Form of Award Notice of Long-Term Compensation Awards granted pursuant to the Transcat, Inc. 2003 Incentive Plan

Grant of Cash Award. This Award Notice serves to notify you that the Board of Directors of Transcat, Inc., an Ohio corporation (the “Company”), has granted to you, under the Company’s 2003 Incentive Plan, as amended and restated (the “Plan”), a cash award (the “Award”), on the terms and conditions set forth in this Award Notice and the Plan, of the Time Amount and Performance Amount (collectively, the “Amounts”) set forth above. You are eligible for this award because you have met your Company stock ownership guidelines. Amounts will vest (become non-forfeitable) as set forth in Sections 2 and 3 and will be payable in the form of cash as set forth in Section 4, all in accordance with the terms of this Award Notice, the Plan, and any rules and procedures adopted by the Committee. The Plan is incorporated herein by reference and made a part of this Award Notice. Capitalized terms not defined herein have the respective meanings set forth in the Plan.

Vesting.
 

The Performance Amount subject to the Award will vest on the Vesting Date based on successful completion of all of the following: 
 

Subject to Section 3 below, you are employed with the Company through the Vesting Date;
 

The percentage of the Performance Amount that will vest, if any, is determined based on the Company’s performance against the performance measure set forth below over the three-year period ending on the Vesting Date, as validated by the Company’s external auditors. The applicable performance measure for the Award and the Performance Amount that vests for the specified levels of performance are as follows:

Effects of Certain Events.

General. Subject to Sections 3(b) through 3(e) of this Award Notice, in the event that your employment with the Company is terminated prior to the Vesting Date, all Amounts that are not vested as of the date of such termination are automatically forfeited.
 

Effect of Death, Disability or Retirement on the Time Amount. In the event of your death or termination of employment due to Disability or Retirement prior to the Vesting Date, then the Award shall continue and the vested Time Amount, if any, shall be distributed on a pro-rata basis on the date that other active participants receive such distributions under their Award Notice for this program. The pro-rata portion shall be determined by multiplying the Time Amount by a fraction, the numerator of which is the number of completed months during the three-year period ending on the Vesting Date which you were employed by the Company, and the denominator of which is the number of months in the period beginning on the Date of Grant and ending on the Vesting Date. For purposes of this Award Notice, “Disability” has the meaning given to such term under the Plan and “Retirement” means your termination of employment on or after the date that you have attained age 55 and have completed five or more years of service with the Company.

Effect of Death or Disability on the Performance Amount. In the event of your death or termination of employment due to Disability prior to the Vesting Date, then the Award shall continue and the vested Performance Amount, if any, from such performance, shall be distributed on a pro-rata basis on the date that other active participants receive such distributions under their Award Notice for this program, based on actual performance, based on the following:

Effect of Retirement on the Performance Amount. If you terminate employment prior to the Vesting Date due to Retirement, then the Award shall continue and the vested Performance Amount, if any, shall be distributed on a pro-rata basis on the date that other active participants receive such distributions under their Award Notice for this program, based on actual performance, based on the following:

If you terminate employment in the first 15 months of the performance period you will forfeit all of the Performance Amount.

If you terminate employment within the 16th through the 27th month of the performance period you will receive a pro-rated portion of the Performance Amount subject to the Award that becomes vested under Section 2(b) above.

If you terminate employment after 27 months of the performance period have elapsed you will receive the full portion of the Performance Amount that becomes vested under Section 2(b) above.