LETTER AGREEMENT
EXHIBIT
10.3
This
letter agreement (this “Agreement”)
is
dated as of February 1, 2007, by and between Hawk Corporation, a Delaware
corporation (“Selling
Shareholder”),
and
PCG Holdings Group Inc., a Delaware corporation (“Buyer”).
Reference
is hereby made to the Stock Purchase Agreement by and between Buyer and Selling
Shareholder, dated as of December 21, 2006 (as such agreement may be amended
or
otherwise modified from time to time, the “Purchase
Agreement”).
Capitalized
terms used but not defined herein shall have the meanings ascribed to such
terms
in the Purchase Agreement.
In
consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement hereby agree as
follows:
| 1. |
Pursuant
to Section 2.7(a) of the Purchase Agreement, each of Selling Shareholder
and Buyer acknowledges and agrees that (i) ten percent (10%) of the
Purchase Price shall be allocated to the covenants granted to Buyer
pursuant to the Noncompetition Agreement and (ii) $3,400,000 shall
be
allocated to the operations of the Acquired Company in
China.
|
| 2. |
The
document that was attached to the Purchase Agreement as Exhibit 2.3(a)
on
the date of execution of the Purchase Agreement shall be of no further
force or effect and shall be replaced in its entirety with the document
included under Annex
I
attached hereto.
|
|
3.
|
Pursuant
to Section 5.4 of the Purchase Agreement, Schedule
3.26
shall be supplemented and replaced in its entirety with the Disclosure
Schedule Supplement included under Annex
II
attached hereto.
|
|
4.
|
The
terms and provisions of Sections 12.4,
12.6,
12.7,
12.8,
12.11,
12.12,
12.13,
12.14
and 12.15
of
the Purchase Agreement are expressly incorporated by reference
into this
Agreement.
|
|
5.
|
The
effective time of the Closing is 12:01 a.m. on February 1,
2007
|
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the parties have executed and delivered this Agreement as
of
the date first written above.
Buyer:
PCG
HOLDINGS GROUP INC.
By: /s/
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇.
▇▇▇▇▇▇
Title: President
Selling
Shareholder:
HAWK
CORPORATION
By: /s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇
▇.
▇▇▇▇▇▇▇▇▇▇
Title: Vice
President - CFO