Document:

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                                                                   Exhibit 10.38

                    TRANSITION AGREEMENT, RELEASE AND WAIVER

         THIS TRANSITION AGREEMENT, RELEASE AND WAIVER ("Agreement") is executed
this 7th day of January, 2004, by and between MICHAEL CORKRAN, an individual
residing at 12805 Keystone Lane Lane, Chardon, Ohio 44024, referred to in this
Agreement as "Corkran", and HAWK CORPORATION, a Delaware corporation whose
principal address is 200 Public Square, Suite 30-5000, Cleveland, Ohio 44114,
referred to in this Agreement as "Hawk."

                                R E C I T A L S :

         Corkran was originally employed by Hawk as President of its Powder
Metal Group in August of 2001. He is currently employed as President of Hawk
Precision Components Group, Inc. ("HPCG").

         Corkran now desires to phase out of his employment with Hawk and its
affiliated companies, and Hawk is willing to accommodate that desire, upon the
terms and conditions hereinafter set forth. Accordingly, Corkran and Hawk agree
as follows:

         1.       CONTINUING EMPLOYMENT, TERMINATION OF EMPLOYMENT RELATIONSHIP;
CONSULTING.

                  (a)      Corkran shall remain in his current position until
the effective date of the installation of a new President of HPCG, which the
parties now contemplate to take place on or about January 1, 2004.

                  (b)      During the period from January 1, 2004 through March
31, 2004, Corkran will serve as an advisor to the President of HPCG on a full
time basis, at his present rate of pay and fringe benefits. Line authority will
be vested in the new President, and Corkran's time will be devoted to assisting
in and supporting the transition of the group to new leadership. Corkran's time
will also be spent working on such other projects as may be assigned by the
chairman of Hawk, so long as such assignments are consistent with Corkran's
position as a former group president. Specific areas of focus will include, but
will not necessarily be limited to; sales support and the smooth transition of
third party relationships such as with Hoganas, Hoeganaes, Hydropulsor, and SMS
Meer to the new President.

                  (c)      Corkran agrees that (i) he will not accept any full
time employment (other than the employment described in this Agreement) until
March 31, 2004, and (ii) after that date, if he does accept other employment
Corkran will provide Hawk with at least thirty (30) days prior notice before he
leaves Hawk and begins other full time employment. In the event Corkran does
accept other full time employment, his compensation from Hawk will cease
immediately.

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                  (d)      If Corkran has not accepted other fulltime
employment, during the period from April 1, 2004 through June 30, 2004, Corkran
will continue to serve as an employee of Hawk, as an advisor to the president of
HPCG, and reporting to that president. Corkran will be compensated by a salary
equal to seventy five percent (75%) of his current rate of base compensation.

                  (e)      Through June 30, 2004, Corkran will continue to
receive fringe benefits such as health insurance, car allowance, etc., but he
will not be entitled to receive any additional stock options or incentive
compensation. On June 30, 2004, Corkran's tenure as an employee of Hawk and its
affiliates shall formerly end, and June 30, 2004 is sometimes referred to in
this Agreement as the "Termination Date."

                  (f)      Beginning on July 1, 2004, Corkran will become a
consultant of Hawk, on an as needed basis. He will be compensated for consulting
services at the rate of $2,000 per day.

         2.       HEALTH INSURANCE. Hawk will continue to provide health
insurance coverage to Corkran, through the end of June, 2004 (the "Coverage
Period"), on the same basis as such coverage is provided to employees of Hawk in
general, but in no event shall Hawk be required to provide greater coverage than
that which was in effect immediately prior to the date hereof. Corkran must make
any required employee contributions or co-payments in a timely fashion in order
to maintain this coverage. At the end of the Coverage Period, Corkran shall have
such rights of conversion and/or continuation as may be provided by the terms of
the applicable health insurance contract and as may be required under applicable
law.

         3.       RELEASE AND WAIVER. With respect to any and all events arising
out of or related to the employment relationship between Corkran and Hawk, HPCG
and any entity affiliated with Hawk or HPCG (such entities being referred to
collectively hereinafter as "Employer"), occurring on or before the date of this
Agreement:

                  (a)      Corkran hereby releases and forever discharges
Employer from any and all claims, demands and causes of action; this includes,
among other things, claims based on the legal theories of wrongful or unjust
termination, breach of contract (express or implied, including without
limitation a certain letter agreement dated on or about August 7, 2001),
promissory estoppel, negligent or intentional (tortious) conduct, negligent or
intentional infliction of emotional distress, defamation, breach of any implied
covenant of good faith and fair dealing, and any and all forms of employment
discrimination, and including claims for attorneys' fees, expenses and costs
related to any of the foregoing;

                  (b)      Corkran hereby releases and forever discharges
Employer from any and all claims, demands and causes of action, and waives any
rights he may have, under Title VII of the Civil Rights Act of 1964, under 42
U.S.C. Section 1981, under the Age Discrimination in Employment Act ("ADEA"),
under the Americans With Disabilities Act, under the Family and Medical Leave
Act of 1993, under the Civil Rights Attorney's Fees Awards Act of 1976, under
Chapter 4112 of the Ohio Revised Code, or under any other federal, state or
local statute prohibiting discrimination in employment, or to request that a
lawsuit be instituted pursuant to 29 U.S.C. Section 206(d); and

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                  (c)      Corkran agrees not to institute a lawsuit with
respect to any matters released or any rights waived in this Agreement.

                  (d)      Nothing contained in this Agreement is intended to
constitute a release or waiver of any claim arising out of or related to a
party's breach of any of his/its obligations pursuant to the terms of this
Agreement.

         4.       CONFIDENTIALITY OF AGREEMENT. Each party agrees that the
existence of this Agreement and its terms and conditions are confidential and
are to be held in strict confidence by the parties and their counsel; provided,
however, that (i) the parties shall be entitled to disclose such terms to their
respective attorneys and accountants, (ii) Corkran may disclose such terms to
his spouse, so long as she also agrees to hold such information confidential,
(iii) Hawk may disclose such terms to those executive level employees who have a
reasonable need to know, in connection with the performance of their job duties,
so long as each such employee also agrees to hold such information confidential
and (iv) disclosure shall be permitted if required by legal process, but not
before the third business day after such party has both received notice of such
process and has delivered a copy thereof to the other party hereto. No party
will voluntarily reveal or engage in any action which it knows or should know
will result in the revelation of any information to any third party concerning
the existence of this Agreement, the contents of this Agreement, or the basis
upon which the claims of the parties have been settled and compromised; the
party may indicate only that all matters have been settled. Notwithstanding the
foregoing, Hawk shall be entitled to make any disclosure concerning this
Agreement and its terms and conditions that it believes to be required under
laws or regulations applicable to reporting by publicly-held companies.

         5.       COVENANTS OF NON-COMPETITION AND NON-SOLICITATION.

                  (a)      Corkran agrees that, during the two (2) year period
beginning on the date of this Agreement (the "Restricted Period"), Corkran shall
not, directly or indirectly, either within any state of the United States of
America in which Employer has done business or with respect to any customer
serviced or solicited by Employer during Corkran's employment, compete with
Employer in any aspect of "the Company's Business" as hereinafter defined, on
behalf of himself or any other person, firm, business, corporation or other
entity (each such person, firm, business or other entity being referred to
hereinafter as a "Person"), including, without limitation, that Corkran shall
not (i) engage in the Company's Business for his own account; (ii) enter the
employ of, or render any services to, any Person engaged in the Company's
Business; (iii) become interested in any Person engaged in the Company's
Business as an owner, partner, shareholder, officer, director, licensor,
licensee, employee, agent, employee, trustee, or in any other relationship or
capacity; provided, however, that Corkran may own, directly or indirectly,
solely as an investment, securities of any corporation which are traded on any
national securities exchange if he (A) is not a controlling person of, or a
member of a group which controls, such corporation, or (B) does not, directly or
indirectly, own 1% more of any class of securities of such corporation; or (iv)
request or instigate any account or customer of Employer to withdraw, diminish,
curtail or cancel any of its business with Employer. In the event of Corkran's
breach of any provision of this paragraph, the running of the Restricted Period
shall be automatically tolled (i.e., no part of the Restricted Period shall
expire) from and after the date of the first such breach. The Company Business
shall

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mean the business of manufacturing, distributing or selling (i) any products
made of powder metal or using a metal injection molding process, or (ii)
friction products, in each case in which Employer was engaged at any time during
Corkran's employment with Employer, or the conducting of research and
development directed toward any aspect of such businesses.

                  (b)      Corkran agrees that, prior to the later of December
31, 2004 or one year from the date of this Agreement (the "No Hire Period"),
Corkran shall not, directly or indirectly, hire, solicit for employment or
encourage to leave the employment of Employer any person who (i) is then an
employee of Employer, (ii) had been an employee of Employer at any time during
the preceding six (6) months, and in either case (iii) was an employee of
Employer on the date of this Agreement. In the event of Corkran's breach of any
provision of this paragraph, the running of the No Hire Period shall be
automatically tolled (i.e., no part of the No Hire Period shall expire) from and
after the date of the first such breach.

                  (c)      Both parties recognize that, if Corkran breaches, or
threatens to commit a breach of, any of the provisions of paragraphs 4, 5 and 6
(the "Restrictive Covenants"), then Hawk shall have, in addition to, and not in
lieu of, any other rights and remedies available to Hawk under law or in equity,
the right to specific performance and/or injunctive relief, it being
acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to Hawk and that money damages will not provide an adequate
remedy to Hawk.

         6.       CONFIDENTIAL INFORMATION. Corkran recognizes and acknowledges
that confidential information, including, without limitation, information,
knowledge or data (i) of a technical nature such as but not limited to methods,
know-how, formulae, compositions, processes, machinery (including computer
hardware), discoveries, inventions, products, product specifications, computer
programs and similar items or research projects; (ii) of a business nature such
as but not limited to information about products, cost, purchasing or suppliers,
profits, market, sales or customers, including lists of customers, and the
financial condition of Employer; (iii) pertaining to future developments such as
but not limited to strategic planning, research and development or future
marketing or merchandising, and trade secrets of Employer; and (iv) all other
matters which Employer treats as confidential (the items described above being
referred to collectively hereinafter as "Confidential Information"), are
valuable, special and unique assets of Employer. During and after the Restricted
Period, Corkran shall keep secret and retain in strictest confidence, and shall
not use for the benefit of himself or others except in connection with the
business and affairs of Employer, any and all Confidential Information learned
by Corkran before or after the date of this Agreement, and shall not disclose
such Confidential Information to anyone outside of Employer either during or
after employment by Employer, except as required in the course of performing
duties of his employment with Employer, without the express written consent of
Employer or as required by law. Corkran further agrees to return all such
information which is in his possession or under his control to Hawk within five
(5) business days after the Termination Date, and all copies thereof (including
any Confidential Information contained on the computer described in paragraph 13
below). Information shall not be considered to be "Confidential Information" if
Corkran can show that such information was, at the time of disclosure, or
subsequently became through no act or omission of Corkran, known to the general
public, through publication or otherwise.

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         7.       CORKRAN COOPERATION. At no cost to Hawk or Corkran, Corkran
agrees to provide reasonable cooperation to Hawk regarding any pending or
subsequently filed litigation, claims or other disputed items involving Employer
that relate to matters within the knowledge or responsibility of Corkran during
his employment, other than claims brought by or on behalf of Corkran that have
not been released hereunder. Without limiting the foregoing, Corkran agrees (i)
to meet with Hawk's representatives, its counsel or other designees at mutually
convenient times and places in the Greater Cleveland area with respect to any
items within the scope of this provision, (ii) to provide truthful testimony
regarding same to any court, agency or other adjudicatory body, and (iii) to
provide Hawk with notice of contact by any adverse party. Corkran further agrees
that he will not assist any such adverse party or such adverse party's
representatives except as may be required by law.

         8.       DISPARAGING COMMUNICATIONS.

                  (a)      Corkran agrees not to make false representations of
fact, or defame, disparage, discredit or deprecate Employer, or any of its
owners or employees, or otherwise communicate with any person in a manner
tending to damage Employer or any of its owners or employees, in its/their
reputation, office, trade, business or means of earning a livelihood.

                  (b)      Hawk agrees not to make false representations of
fact, or defame, disparage, discredit or deprecate Corkran, or otherwise
communicate with any person in a manner tending to damage Corkran, in his
reputation, office, trade, business or means of earning a livelihood.

         9.       CORKRAN'S CONSULTING BUSINESS. The parties understand that
Corkran intends to begin a consulting business, in which he will offer his
services as a business consultant, to assist companies in the development and
implementation of strategies to do business in China (the "Corkran Consulting
Business"). In connection therewith:

                  (a)      Corkran covenants that, during the period from April
1, 2004 through June 30, 2004, he will not spend more than twenty-five percent
(25%) of his business time and effort engaging in the Corkran Consulting
Business, and that the time he spends engaging in the Corkran Consulting
Business during that period of time shall not interfere with his performance of
his obligations pursuant to paragraph 1(d) of this Agreement. Corkran further
covenants that, after June 30, 2004, his engaging in the Corkran Consulting
Business shall not interfere with his performance of his obligations pursuant to
this Agreement.

                  (b)      Hawk acknowledges that, in general, Corkran's
engaging in the Corkran Consulting Business does not constitute a violation of
the terms of paragraph 5(a) of this Agreement; provided, however, that if a
customer or client of the Corkran Consulting Business is also engaged in an
aspect of the Company Business (as defined in paragraph 5(a) of this Agreement),
a violation would be deemed to occur.

                  (c)      In the event that a customer or client of the Corkran
Consulting Business is also either using or prospectively using powder metal
parts, metal injection molded parts or friction materials, (i) if the customer
of the Corkran Consulting Business is also a customer of Hawk or its affiliates,
Corkran shall not in any way supply or advise the customer with respect to

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the acquisition or use of powdered metals, except to encourage the customer to
remain a customer of Hawk or its affiliates; and (ii) ) if the customer of the
Corkran Consulting Business is not already a customer of Hawk or its affiliates,
Corkran shall use his best efforts to cause that customer to become a customer
of Hawk or its affiliates, including, without limitation, that Corkran will
arrange an opportunity for Hawk or its affiliates to bid on that customer's
business, and to have a "last look" if possible.

         10.      STOCK OPTIONS.

                  (a)      The parties hereto are also parties to a certain
Incentive Stock Option Agreement entered into as of August 7, 2001 (the "August
2001 Option Agreement"). Corkran acknowledges that 12,000 of the options under
the August 2001 Option Agreement have vested in accordance with the terms of the
August 2001 Option Agreement and may be exercised at any time by Corkran in
accordance with the August 2001 Option Agreement. Nevertheless, Corkran hereby
agrees to forgo any and all rights he may have under the August 2001 Option
Agreement, including the rights to exercise the vested options. Therefore,
effective as of the date of this Agreement, the August 2001 Option Agreement is
hereby terminated in its entirety.

                  (b)      Hawk acknowledges that Corkran has recommended that
the total amount of options, vested and unvested, that he was originally granted
under the August 2001 Option Agreement and which he has now agreed to surrender
in accordance with paragraph 9(a) be granted to key HPCG personnel. Without any
legal or other obligation on its part, Hawk will take Corkran's recommendation
under advisement.

                  (c)      Hawk confirms to Corkran that the certain Incentive
Stock Option Agreement entered into as of October 5, 2001 (the "October 2001
Option Agreement") remains in full force and effect. Corkran at his discretion
may determine whether or not to exercise the options granted thereunder. Any
such exercise by Corkran shall be made in accordance with the terms of the
October 2001 Option Agreement.

         11.      TERMS OF OFFER; REVOCATION.

                  (a)      This Agreement has been delivered to Corkran on the
29th day of December, 2003. The offer contained herein shall remain open until
the end of the twenty-first full day after delivery.

                  (b)      After execution of this Agreement, Corkran may revoke
his agreement hereto by delivering written notice of revocation to Hawk at any
time during the period from the date of Corkran's execution through the end of
the seventh full day after such execution (the "Revocation Period").

         12.      COUNSEL. Hawk advises and encourages Corkran to consult with
an attorney prior to signing this Agreement.

         13.      COMPUTER. At the Termination Date, so long as Corkran has not
breached this Agreement, the computer which Hawk has supplied to Corkran for his
use during his employment

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shall be transferred to Corkran, in consideration of the promises of Corkran
contained in this Agreement. No further action by any party shall be required to
effect the transfer of that computer to Corkran; provided, however, that as a
condition precedent to such transfer, all Confidential Information of Hawk and
its affiliates which may be contained on that computer shall be permanently
deleted from its memory, shall not be retained by Corkran in any form or format,
and Corkran shall provide Hawk with such access to that computer as Hawk may
reasonably deem necessary or appropriate to verify compliance with this
provision.

         14.      NO LIABILITY. Nothing contained in this Agreement is intended
to constitute an admission by Employer of liability of any nature whatsoever to
Corkran, and Employer expressly denies any such liability.

         15.      GOVERNING LAW; JURISDICTION. This Agreement shall be governed
by and shall be interpreted in accordance with the laws of the State of Ohio,
and the parties hereby confer jurisdiction upon the courts of any jurisdiction
within the State of Ohio to determine any dispute arising out of or related to
this Agreement, or the breach hereof.

         16.      COSTS OF ACTION. In the event that any party to this Agreement
brings any action or proceeding in connection with this Agreement, the
prevailing party in such action shall be entitled to recover, as part of such
action or proceeding, its costs therein including reasonable attorneys' fees.

         17.      COUNTERPARTS. This Agreement may be executed by the parties in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. The execution of
counterparts shall not be deemed to constitute delivery of this Agreement by a
party until both of the parties have executed and delivered their respective
counterparts.

         18.      HEADINGS. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.

         19.      SEVERABILITY. It is the intention of the parties that the
terms and provisions of this Agreement be construed to be separable and
severable. If any term or provision of this Agreement shall be held void,
invalid, unenforceable or in conflict with any applicable law, all of the other
terms and provisions of this Agreement shall remain valid and fully enforceable.

         20.      ENTIRE AGREEMENT; AMENDMENTS. This Agreement embodies the
entire agreement between the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and understandings, oral or written,
with respect thereof. This Agreement may not be changed orally, but may be
amended, superseded, cancelled, renewed or extended, and the terms hereof may be
waived, only by an instrument in writing signed by each of the parties, or, in
the case of a waiver, signed by the party against whom enforcement of such
waiver is being sought.

         21.      ACKNOWLEDGEMENT. Corkran acknowledges that he has carefully
read all of the terms of this Agreement, that such terms have been fully
explained to him and that he understands

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the consequences of each and every term, that he has had sufficient time and an
opportunity to consult with his own legal advisor prior to signing this
Agreement, and that he specifically understands that by signing this Agreement
he is giving up any and all rights he may have against Hawk under the laws and
legal theories referred to above with respect to events occurring on or before
this date.

         THIS TRANSITION AGREEMENT, RELEASE AND WAIVER signed at Cleveland, Ohio
on the date set forth in the first paragraph above.

                                         /s/ Michael Corkran
                                         ---------------------------------------
                                         MICHAEL CORKRAN

                                         HAWK CORPORATION

                                         By: /s/ Ronald E. Weinberg
                                             -----------------------------------
                                         Its: Chairman

                                       8<PAGE>
                                                                   Exhibit 10.39

                                   SALES PLAN
                                   ----------

         Sales Plan, dated January 9, 2004 (the "Sales Plan"), between the
Harbert Foundation, an Ohio limited partnership ("Seller") and Northern Trust
Securities, Inc. ("Northern").

         RECITALS

         WHEREAS, Seller desires to establish this Sales Plan to sell
unregistered shares of Class A common stock, par value $0.01 of Hawk
Corporation, a Delaware corporation (the "Issuer"), acquired prior to the
initial public offering of the Issuer (the "Stock"); and

         WHEREAS, Seller desires to sell a total of 70,000 shares of Stock (the
"Total Plan Shares"); and

         WHEREAS, Seller desires to engage Northern to effect sales of shares of
Stock in accordance with the Sales Plan;

         NOW, THEREFORE, Seller and Northern hereby agree as follows:

         A. IMPLEMENTATION OF THE SALES PLAN

         1. Subject to Paragraph A.7., Northern shall effect sales (each a
"sale") as provided herein. Beginning on January 1, 2004 and thereafter on the
first Friday of each subsequent quarter on which the American Stock Exchange
(Amex) is open and effectuating trades ("Trade Date"), a limit order for 5,000
shares of Stock (or, if less than 5,000 of the Total Plan Shares remain, such
remaining amount) at the market price per share on the Trade Date. If,
consistent with ordinary principles of best execution or for any other reason,
Northern cannot sell any or all of the 5,000 shares of Stock on the Trade Date,
then the amount of such shortfall shall be sold as soon as practicable on the
immediately succeeding days in which the Amex is open and trades regular way
following the Trade Date ("Business Day"); provided that in no event may the
amount of any shortfall be sold any later than the fourth Business Day following
the Trade Date. In the event that any shares of Stock are not sold within four
Business Days of the Trade Date, Northern will have no authority to sell any
such shortfall on the succeeding month's Trade Date.

         2. Seller acknowledges and agrees that Northern will handle the above
order on a best efforts basis. In the event any limit prices of orders are away
from the prevailing market prices at any time, there can be no assurance that
such orders will be executed in whole or in part. Seller agrees that all orders
may be partially executed and will not be treated as an all or none order.

         3. Seller agrees to deposit 70,000 shares of Stock into a Northern
brokerage account (the "Account"). Northern shall withdraw Stock from Seller's
Account in order to effect sales of Stock under this Sales Plan. If on any day
that sales are to be made under this Sales Plan the number of shares of Stock in
Seller's Account is less than the number of shares to be sold on such day, then
Northern shall notify Seller promptly of such deficiency, and Seller agrees to

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promptly deposit into the Account the number of shares of Stock necessary to
eliminate such deficiency.

         4. Subject to Paragraph A.10., Seller agrees not to remove or transfer
shares of Stock out of the Account. Upon notification pursuant to Paragraph
A.10., Seller shall have the right to remove the portion of the Total Plan
Shares subject to such Private Sale or Gift from Seller's Account.

         5. To the extent that any Stock remains in Seller's Account upon
termination of this Sales Plan, Northern agrees to return such Stock promptly to
the Issuer's transfer agent for relegending to the extent that such Stock would
then be subject to transfer restrictions in the hands of Seller.

         6. Northern will deduct its reasonable and customary commissions from
the proceeds of sales of Stock under this Sales Plan, together with any other
reasonable expenses incurred by Northern in connection with such sales.

         7. Subject to Paragraph E.6., this Sales Plan shall become effective on
January 9, 2004 ("Effective Date") and shall terminate on the earliest of the
date on which the Total Plan Shares have been sold, the date this Sales Plan is
terminated pursuant to Paragraph E.3., or upon notification of death of Norman
C. Harbert.

         8. Seller acknowledges and agrees that he does not have authority,
influence or control over any sales of Stock effected by Northern pursuant to
this Sales Plan, and will not attempt to exercise any authority, influence or
control over such sales. Northern agrees not to seek advice from Seller with
respect to the manner in which it effects sales under this Sales Plan. Seller
understands that Northern shall have no discretion as to the timing of the sales
of Stock.

         9. Northern will notify Seller and Issuer of all transactions pursuant
to customary trade confirmations that are provided in the normal course of
business.

         10. Seller agrees that he will notify Northern as soon as possible in
the event he consummates a private sale of any portion of the Total Plan Shares
to the Issuer (a "Private Sale") or makes a bona fide gift of any portion of the
Total Plan Shares (a "Gift"). Seller agrees that in the event that any sale of a
portion of the Total Plan Shares by Northern pursuant to this Sales Plan, when
combined with a Private Sale or a Gift, results in the sale of Stock in excess
of the Total Plan Shares, Seller shall be responsible for delivering additional
Stock to Northern to cover the excess number of shares sold.

         11. Seller understands that Northern may not be able to effect a sale
due to a market disruption or a legal, regulatory or contractual restriction
applicable to Northern, an insufficient number of shares of Stock being in the
Account or a pending sale under this Sales Plan causing Seller to exceed any
applicable volume limitations of Rule 144 or 145 under the Securities Act of
1933 (the "Securities Act"). If any sale cannot be executed as required by
Paragraph A.1. due to a market disruption, a legal, regulatory or contractual
restriction applicable to Northern or any other such event, Northern shall
effect such sale as promptly as practical after the cessation or

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termination of such market disruption, applicable restriction or other event,
or, at the discretion of Northern, the Sales Plan may be terminated.

         12. It is the intent of the parties that this Sales Plan comply with
the requirements of Rule 10b5-1(c)(1)(i)(B) under the Securities Exchange Act of
1934 (the "Exchange Act") and this Sales Plan shall be interpreted to comply
with the requirements of Rule 10b5-1(c).

         B. RULES 144 AND 145

         The following three paragraphs shall only apply to the extent Seller is
subject to Rules 144 and 145.

         1. Northern agrees to conduct all sales in accordance with the manner
of sale requirement of Rule 144 or 145 under the Securities Act, and in no event
shall Northern effect any such sale if such sale would exceed the then
applicable volume limitation under Rule 144, assuming Northern's sales under
this Sales Plan and those notified to Northern pursuant to Paragraph B.3. are
the only sales subject to that limitation. Seller will be responsible for
completing and filing all required Form 144s prior to the sale of any Stock
covered under Rule 144. Seller agrees to promptly provide Northern with a copy
of any Form 144 filing made by Seller. In the event Seller requests, and
Northern agrees, in writing, to make certain Form 144 filings, Seller hereby
appoints Northern as agent and attorney-in-fact to execute, file and submit, on
behalf of Seller, any such required Form 144s.

         2. Each such Form 144 shall state in the "Remarks" section that the
sales thereunder are being made pursuant to a previously adopted plan intended
to comply with Rule 10b5-1(c), shall include the date Seller adopted this Sales
Plan and shall indicate that the representation regarding Seller's knowledge of
material information speaks as of the adoption date of this Sales Plan.

         3. Seller agrees not to take any action that would cause the sales not
to comply with Rule 144 or 145, and Seller agrees not to cause any person or
entity with which Seller would be required to aggregate sales of Stock pursuant
to paragraph (a)(2) or (e) of Rule 144 to take any action that would cause the
sales not to comply with Rules 144 or 145. Seller will provide notice of any
such transactions during the three months preceding the date hereof and may not
enter into any other selling program or transaction without the prior consent of
Northern.

         C. REPRESENTATIONS AND AGREEMENTS OF SELLER

         1. Seller represents and warrants that as of the time of execution of
this Sales Plan, Seller: (a) is not aware of material, nonpublic information
with respect to the Issuer or any securities of the Issuer (including the Stock)
and, (b) is entering into this Sales Plan in good faith and not as part of a
plan or scheme to evade the prohibitions of Rule 10b5-1 under the Exchange Act
or other applicable securities laws.

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         2. At the time of Seller's execution of this Sales Plan, Seller has not
entered into or altered a corresponding or hedging transaction with respect to
the Stock. Seller agrees not to enter into any such transaction while this Sales
Plan remains in effect.

         3. Seller agrees to make all filings, if any, required under and
monitor his compliance with Sections 13(d), 13(g) and 16 of the Exchange Act.

         4. Except as provided in Paragraph B.1., Seller acknowledges and agrees
that Northern has no duty to determine whether Sellers have violated Rules 144
or 145 under the Securities Act, or Sections 13(d), 13(g) or 16 of the Exchange
Act or the rules adopted by the SEC thereunder. Seller understands that this
Plan in no way alters his obligations and responsibilities under Section 16,
including those prohibitions against short swing profits.

         5. Seller understands that there may be specific state law restrictions
or limitations applicable to this Sales Plan. Seller acknowledges and agrees
that Northern has not provided Seller with any tax, accounting or legal advice.
Seller understands that he should seek the advice of counsel regarding this
Sales Plan and the various securities and tax law issues related thereto.

         6. Seller agrees to notify Northern immediately in the event of trading
restrictions being imposed as the result of any lock up event restricting sales
by affiliates, such as a stock offering, tender offer or acquisition transaction
or any similar event.

         7. Seller represents and warrants that he is able to sell shares of
Stock, as contemplated by this Sales Plan, in accordance with the Issuer's
statement regarding insider trading and confidentiality, as supplemented and
amended from time to time and Seller has obtained the acknowledgement of the
Issuer to enter into this Sales Plan. Seller further represents and warrants
that the Stock is not subject to any liens, security interests or other
impediments to transfer (except for limitations imposed by Rules 144 or 145, if
applicable).

         D. INDEMNIFICATION AND LIMITATION ON LIABILITY

         1. Seller agrees to indemnify and hold harmless Northern and its
directors, officers, employees and affiliates from and against all claims,
losses, damages and liabilities (including without limitation, any legal or
other expenses reasonably incurred in connection with defending or investigating
any such action or claim) arising out of or attributable to Northern's actions
taken or not taken in compliance with this Sales Plan or arising out of or
attributable to any breach by Seller of this Sales Plan (including Seller's
representations and warranties hereunder) or any violation by Seller of
applicable laws or regulations. Seller will not be liable under the foregoing
sentence to the extent that any claim, loss, damage or liability is found in a
final judgement by a court to have resulted from the bad faith, gross negligence
or willful misconduct of Northern or its directors, officers, employees or
affiliates. This indemnification shall survive termination of this Sales Plan.

         2. Notwithstanding any other provision hereof, Northern shall not be
liable to Seller for: (a) special, indirect, punitive, exemplary or
consequential damages, or incidental losses or damages of any kind, even if
advised of the possibility of such losses or damages or if such

                                       4
<PAGE>

losses or damages could have been reasonably foreseen; or (b) any failure to
perform or to cease performance or any delay in performance that results from a
cause or circumstance that is beyond its reasonable control, including but not
limited to failure of electronic or mechanical equipment, strikes, failure of
common carrier or utility systems, severe weather, market disruptions or other
causes commonly known as "acts of God".

         E. GENERAL

         1. This Sales Plan shall be governed by and construed in accordance
with the laws of the State of Delaware without reference to choice of law
principles and may be modified or amended only by a writing signed by the
parties hereto and acknowledged by the Issuer.

         2. This Sales Plan shall be subject to all terms and conditions
governing Seller's Account, including the Northern Account Agreement.

         3. Notwithstanding anything to the contrary herein, Seller and/or
Issuer may notify Northern to terminate this Sales Plan at any time. Seller may
also notify Northern to modify sales under this Sales Plan; provided, however,
that such modification shall not be effective until 30 days after the
notification thereof and the acknowledgement of Issuer. Any such modification or
termination shall be made in good faith and not as a part of a plan or scheme to
evade the prohibitions of Rule l0b5-1 or other applicable securities laws.
Seller agrees that he will not modify this Sales Plan at any time that he is
aware of any material non-public information about the Issuer and/or the Stock.

         4. All notices to Northern under this Sales Plan shall be given to
Northern's office by facsimile at (312) 444-4410 or by certified mail at
Northern Trust Securities, Inc., 50 S. LaSalle Street, B-12, Chicago, Illinois
60675. Attention: Sheila Dorman. Upon termination or suspension of this Sales
Plan, Northern will send notice to Seller and Issuer to the address provided
below.

         5. Seller's rights and obligations under this Sales Plan may not be
assigned or delegated without the written permission of Northern.

         6. This Sales Plan shall not be effective until executed by Seller and
Northern, and acknowledged by Issuer. This Sales Plan may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto were upon the same instrument.

                                       5
<PAGE>

The Harbert Foundation

By:/s/ Norman C. Harbert
   ---------------------------------
Name:  Norman C. Harbert
Title: Trustee

Northern Trust Securities, Inc.

By:/s/ Northern Trust Securities, Inc.
   -----------------------------------------

Solely for purposes of acknowledging notification of the foregoing Sales Plan
and not as a party thereto, except to the extent of its rights thereunder, Hawk
Corporation, through its representative, has duly signed below:

Hawk Corporation

By:  /s/ Thomas A. Gilbride
     ---------------------------------------
Name:  Thomas A. Gilbride
Title: Vice President - Finance
Address: 200 Public Square
         Suite 1500
         Cleveland, OH 44114

                                       6

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