<PAGE>
                                                                    EXHIBIT 10.1


                                 AMENDMENT NO. 1
                                       TO
                                CREDIT AGREEMENT

         THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "AMENDMENT") is dated as
of August 6, 2002, by and among METAL MANAGEMENT, INC., a Delaware corporation
("MTLM") and each of the corporations and other entities signatories hereof as
borrowers (MTLM and each of such corporations and other entities sometimes
hereinafter are referred to individually as a "BORROWER" and collectively as the
"BORROWERS"); MTLM, acting in its capacity as funds administrator for itself and
the other Borrowers (in such capacity, the "FUNDS ADMINISTRATOR"); DEUTSCHE BANK
TRUST COMPANY AMERICAS, a New York banking corporation, f/k/a Bankers Trust
Company, acting in its capacity as agent (in such capacity, hereinafter referred
to as the "AGENT") for itself and the other financial institutions from time to
time parties to the Credit Agreement referred to herein below as lenders
thereunder (such financial institutions hereinafter are referred to individually
as a "LENDER" and collectively as the "LENDERS"); and the Lenders signatories
hereto. Capitalized terms used herein but not otherwise defined herein shall
have the respective meanings assigned to such terms in the Credit Agreement.

                                   WITNESSETH:

         WHEREAS, the Borrowers, the Funds Administrator, the Agent and the
Lenders have entered into that certain Credit Agreement dated as of June 29,
2001 (as amended, restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"), pursuant to which the Lenders have agreed to make
certain loans and other financial accommodations to or for the account of the
Borrowers; and

         WHEREAS, the Borrower, the Funds Administrator, the Agent and the
Lenders have agreed to amend the Credit Agreement on the terms and subject to
the conditions hereinafter set forth;

         NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
respective parties hereto hereby agree as follows:

         1. AMENDMENT TO CREDIT AGREEMENT. Effective as of the date hereof, upon
satisfaction of the conditions precedent set forth in SECTION 2 below, and in
reliance upon the representations and warranties of the Funds Administrator and
the Borrowers set forth herein and in the Credit Agreement, as amended hereby,
the Credit Agreement is hereby amended as follows:

         1.1 The definition of "Expiration Date" in SECTION 1.1 of the Credit
Agreement is hereby amended and restated in its entirety to read as follows:

                  "Expiration Date" means the earlier of (i) July 1, 2003 and
                  (ii) the date on which this Credit Agreement is terminated
                  pursuant to SECTION 9.2(B).


<PAGE>

         2. CONDITIONS PRECEDENT. This Amendment shall become effective as of
the date hereof, upon receipt by the Agent of a copy of this Amendment, duly
executed and delivered by each of the Lenders, each of the Borrowers and the
Funds Administrator.

         3. REPRESENTATIONS AND WARRANTIES.

         3.1 Each of the Borrowers and the Funds Administrator hereby represents
and warrants to the Agent and each of the Lenders that, before and after giving
effect to this Amendment:

                  (A) All representations and warranties contained in the Credit
         Agreement and the other Credit Documents are true and correct in all
         material respects on and as of the date of this Amendment, in each case
         as if then made, other than representations and warranties that
         expressly relate solely to an earlier date (in which case such
         representations and warranties remain true and correct in all material
         respects on and as of such earlier date);

                  (B) No Default or Event of Default has occurred which is
         continuing;

                  (C) This Amendment, and the Credit Agreement, as amended
         hereby, constitute legal, valid and binding obligations of the
         Borrowers and the Funds Administrator, respectively, and are
         enforceable against each of the Borrowers and the Funds Administrator
         in accordance with their respective terms, except as such
         enforceability may be limited by (i) bankruptcy, insolvency or similar
         law affecting creditors rights generally, and (ii) general principals
         of equity; and

                  (D) The execution and delivery by the Borrowers and the Funds
         Administrator of this Amendment (I) does not and will not contravene,
         conflict with, violate or constitute a default under the certificate of
         incorporation or bylaws of any Credit Party, or any applicable law,
         rule, regulation, judgment, decree or order or any agreement, indenture
         or instrument to which any Credit Party is a party or is bound or which
         is binding upon or applicable to all or any portion of any Credit
         Party's property, and (II) does not require the consent or approval of
         any Person, except for any such consents or approvals which have been
         obtained and remain in full force and effect.

         4. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER CREDIT
DOCUMENTS.

         4.1 Upon the effectiveness of this Amendment, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words
of like import, and each reference in each of the other Credit Documents to the
"Credit Agreement" shall in each case mean and be a reference to the Credit
Agreement as amended hereby.

         4.2 Except as expressly set forth herein, (i) the execution and
delivery of this Amendment shall in no way affect any of the respective rights,
powers or remedies of the




                                       2
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Agent or any of the Lenders with respect to any Default or Event of Default nor
constitute a waiver of any provision of the Credit Agreement or any of the other
Credit Documents and (ii) all of the respective terms and provisions of the
Credit Agreement, the other Credit Documents and all other documents,
instruments, amendments and agreements executed and/or delivered by any of the
Borrowers and/or the Funds Administrator pursuant thereto or in connection
therewith shall remain in full force and effect and are hereby ratified and
confirmed in all respects. The execution and delivery of this Amendment by Agent
and the respective Lenders shall in no way obligate the Agent or any of the
Lenders, at any time hereafter, to consent to any other amendment or
modification of any term or provision of the Credit Agreement or any of the
other Credit Documents, whether of a similar or different nature.

         4.3 Each Borrower (and each other Credit Party, if any, which executed
an acknowledgement hereof, by such execution), in its respective capacities
under the each of the Credit Documents to which it is a party (including the
capacities of obligor, grantor, mortgagor, pledgor, guarantor, indemnitor and
assignor, as applicable, and each other similar capacity, if any, in which such
Credit Party has granted Liens on all or any part of the properties or assets
such Credit Party, or otherwise acts as an accommodation party, guarantor,
indemnitor or surety with respect to all or any part of the Obligations), hereby
(A) agrees that the terms and provisions hereof shall not affect in any way,
except as otherwise set forth herein, any payment, performance, observance or
other obligations or liabilities of such Credit Party under the Credit Agreement
or any of the other Credit Documents, all of which obligations and liabilities
shall remain in full force and effect and extend to the further loans,
extensions of credit and other Obligations provided for thereunder, and each of
which obligations and liabilities are hereby ratified, confirmed and reaffirmed
in all respects; and (B) to the extent such Credit Party has granted Liens on
any of its properties or assets pursuant to any of the Credit Documents to
secure the prompt and complete payment, performance and/or observance of all or
any part of the Obligations, acknowledges, ratifies, confirms and reaffirms such
grant of Liens, and acknowledges and agrees that all of such Liens are intended
and shall be deemed and construed to secure to the fullest extent set forth
therein all now existing and hereafter arising Obligations under and as defined
in this Credit Agreement, as amended, restated, supplemented and otherwise
modified and in effect from time to time.


         5. GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AMENDMENT SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401, BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF
THE STATE OF NEW YORK.

         6. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.



                                       3
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         7. COUNTERPARTS. This Amendment may be executed or otherwise
authenticated in any number of counterparts and by the different parties hereto
in separate counterparts, each of which when so executed or otherwise
authenticated and delivered shall be an original, but all of which shall
together constitute one and the same instrument. Any such counterpart which may
be delivered by facsimile, email or similar electronic transmission shall be
deemed the equivalent of an originally signed counterpart and shall be fully
admissible in any enforcement proceedings regarding this Amendment.



                  [Remainder of Page Intentionally Left Blank;
                             Signature Pages Follow]



                                       4
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         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their proper and duly authorized officers as of
the date first set forth above.

                                         METAL MANAGEMENT, INC.,
                                         as Funds Administrator and
                                         its individual capacity as a Borrower

                                         By:       /s/ Robert C. Larry
                                              -------------------------------
                                         Name:         Robert C. Larry
                                                -----------------------------
                                         Title:    Chief Financial Officer
                                                 ----------------------------



Amendment No. 1 to MTLM Credit Agreement

<PAGE>



                                    ADDITIONAL BORROWERS:

                                    CALIFORNIA METALS RECYCLING, INC.
                                    CIM TRUCKING, INC.
                                    FIRMA, INC.
                                    FIRMA PLASTIC CO., INC.
                                    MAC LEOD METALS CO.
                                    MTLM ARIZONA, INC.
                                    METAL MANAGEMENT AEROSPACE, INC.
                                    METAL MANAGEMENT ALABAMA, INC.
                                    METAL MANAGEMENT ARIZONA, L.L.C.
                                    METAL MANAGEMENT CONNECTICUT, INC.
                                    METAL MANAGEMENT INDIANA, INC.
                                    METAL MANAGEMENT GULF COAST, INC.
                                    METAL MANAGEMENT MEMPHIS, L.L.C.
                                    METAL MANAGEMENT MIDWEST, INC.
                                    METAL MANAGEMENT MISSISSIPPI, L.L.C.
                                    METAL MANAGEMENT NORTHEAST, INC.
                                    METAL MANAGEMENT OHIO, INC.
                                    METAL MANAGEMENT PITTSBURGH, INC.
                                    METAL MANAGEMENT REALTY, INC.
                                    METAL MANAGEMENT SERVICES, INC.
                                    METAL MANAGEMENT STAINLESS & ALLOY, INC.
                                    METAL MANAGEMENT WEST, INC.
                                    METAL MANAGEMENT WEST COAST HOLDINGS, INC.
                                    METAL MANAGEMENT S&A HOLDINGS, INC.
                                    METALS.COM, INC.
                                    PROLER SOUTHWEST INC.
                                    TROJAN TRADING CO.

                                    By:      /s/ Robert C. Larry
                                        --------------------------------------
                                    Name:        Robert C. Larry
                                         -------------------------------------
                                    Title:       Vice President
                                          ------------------------------------



Amendment No. 1 to MTLM Credit Agreement

<PAGE>



                                     RESERVE IRON & METAL LIMITED
                                     PARTNERSHIP

                                     By:      METAL MANAGEMENT OHIO, INC.,
                                              its general partner


                                     By:      /s/ Robert C. Larry
                                         -------------------------------------
                                     Name:         Robert C. Larry
                                          ------------------------------------
                                     Title:        Vice President
                                           -----------------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                 AGENT AND LENDER:

                                 DEUTSCHE BANK TRUST COMPANY
                                 AMERICAS, in its respective capacities as Agent
                                 and a Lender


                                 By:      /s/ Albert Fischetti
                                     -----------------------------------------
                                 Name:        Albert Fischetti
                                      ----------------------------------------
                                 Title:       Director
                                       ---------------------------------------



Amendment No. 1 to MTLM Credit Agreement

<PAGE>



                                            LENDER:

                                            CONGRESS FINANCIAL CORP. (CENTRAL)


                                            By:      /s/ Gerald Wordell
                                                ------------------------------
                                            Name:       Gerald Wordell
                                                 -----------------------------
                                            Title:      Vice President
                                                  ----------------------------

Amendment No. 1 to MTLM Credit Agreement

<PAGE>



                                       LENDER:

                                       FINOVA CAPITAL CORPORATION


                                       By:      /s/ Glenn E. Gray
                                           -----------------------------------
                                       Name:        Glenn E. Gray
                                            ----------------------------------
                                       Title:       Chief Operating Officer
                                             ---------------------------------

Amendment No. 1 to MTLM Credit Agreement

<PAGE>



                                            LENDER:

                                            FLEET CAPITAL CORPORATION


                                            By:      /s/ Robert Lund
                                                -------------------------------
                                            Name:        Robert Lund
                                                 ------------------------------
                                            Title:       Senior Vice President
                                                  -----------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                            LENDER:

                                            HELLER FINANCIAL, INC.


                                            By:      /s/ W. Jerome McDermott
                                                -------------------------------
                                            Name:        W. Jerome McDermott
                                                 ------------------------------
                                            Title:
                                                  -----------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                            LENDER:

                                            LASALLE BANK NATIONAL ASSOCIATION


                                            By:      /s/ John Mostofi
                                                -------------------------------
                                            Name:        John Mostofi
                                                 ------------------------------
                                            Title:       Senior Vice President
                                                  -----------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                            LENDER:

                                            PNC BUSINESS CREDIT CORPORATION


                                            By:      /s/ Lee LaBine
                                                --------------------------------
                                            Name:        Lee LaBine
                                                 -------------------------------
                                            Title:       Vice President
                                                  ------------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                         LENDER:

                                         IBJ WHITEHALL BUSINESS CREDIT
                                         CORPORATION


                                         By:      /s/ Carl Giordano
                                             -----------------------------------
                                         Name:        Carl Giordano
                                              ----------------------------------
                                         Title:       Assistant Vice President
                                               ---------------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                            LENDER:

                                            U.S. BANK NATIONAL ASSOCIATION
                                            (FORMERLY FIRSTAR BANK N.A.)

                                            By:      /s/ Lisa M. Riley
                                                --------------------------------
                                            Name:        Lisa M. Riley
                                                 -------------------------------
                                            Title:       Vice President
                                                  ------------------------------


Amendment No. 1 to MTLM Credit Agreement
<PAGE>



                                            LENDER:

                                            GUARANTY BUSINESS CREDIT CORPORATION


                                            By:      /s/ Ed Henkel
                                                --------------------------------
                                            Name:        Ed Henkel
                                                 -------------------------------
                                            Title:      Senior Vice President
                                                  ------------------------------


Amendment No. 1 to MTLM Credit Agreement