<PAGE>   1

                                                                  EXHIBIT 4.1(A)

    THIS DOCUMENT IS SUBJECT TO A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO
                          RULE 24B-2 OF THE COMMISSION

                            AMENDMENT AGREEMENT NO. 1
                               TO CREDIT AGREEMENT


         THIS AMENDMENT AGREEMENT (this "Amendment Agreement") is made and
entered into as of this 12th day of January, 2001, by and among INSTEEL
INDUSTRIES, INC., a North Carolina corporation (herein called the "Borrower"),
BANK OF AMERICA, N.A., a national banking association (the "Agent"), as Agent
for the lenders (the "Lenders") party to the Credit Agreement dated January 31,
2000 (the "Agreement"), among the Borrower, the Agent, and the Lenders, and the
UNDERSIGNED LENDERS.

                              W I T N E S S E T H:

         WHEREAS, the parties hereto have entered into the Agreement pursuant to
which the Lenders have agreed to make loans to the Borrower in the aggregate
principal amount of up to $140,000,000 as evidenced by the Notes (as defined in
the Agreement) and to issue Letters of Credit for the benefit of the Borrower;
and

         WHEREAS, as a condition to the making of the loans pursuant to the
Agreement the Lenders have required that the Subsidiaries of the Borrower
guarantee payment of all Obligations of the Borrower arising under the
Agreement; and

         WHEREAS, the Borrower is not in compliance with certain of the
covenants contained in the Agreement and as a result Events of Default exist
under the Agreement; and

         WHEREAS, the Borrower has requested that the Lenders waive the existing
Events of Default and further amend the Agreement in the manner described
herein; and

         WHEREAS, the Lenders are willing to further amend the Agreement subject
to the terms and conditions set forth herein;

         NOW, THEREFORE, the Borrower, the Agent and the Lenders do hereby agree
as follows:

         1.       Definitions. The term "Agreement" as used herein and in the
Loan Documents (as defined in the Agreement) shall mean the Agreement as
hereinafter amended and modified. Unless the context otherwise requires, all
terms used herein without definition shall have the definition provided therefor
in the Agreement.

         2.       Amendment. Subject to the conditions set forth herein, the
Agreement is hereby amended, effective as of December 31, 2000, as follows:

                  (a)      Section 1.01 is hereby amended by adding the
         following new definition thereto in the appropriate alphabetical order:


<PAGE>   2
                           "Amendment No. 1" means Amendment Agreement No. 1 to
                  Credit Agreement which Amendment No. 1 is dated January 12,
                  2001;

                  (b)      The definition of "Applicable Margin" in Section 1.1
         is hereby amended in its entirety so that as amended it shall read as
         follows:

                           "'Applicable Margin' means for each of the periods
                  set forth below that percent per annum set forth opposite each
                  such period:


<TABLE>
<CAPTION>
                                                                          Applicable
                                       Period                               Margin
                      ----------------------------------------            ----------
                      <S>                                                 <C>
                      Date of Amendment No. 1 through
                      March 31, 2001                                        1.75%

                      April 1, 2001 through June 30, 2001                   2.00%

                      July 1, 2001 through September 30, 2001               2.50%

                      October 1, 2001 through January 15, 2002              3.00%"
</TABLE>

                  (c)      The definition of "Borrowing Base" in Section 1.1 is
         hereby amended by (i) deleting the period at the end and inserting in
         lieu of such period a semi-colon; and (ii) adding the following proviso
         immediately following the semi-colon:

                  "provided, however, that the maximum amount of Eligible
                  Inventory that may be included in the Borrowing Base shall be
                  $45,000,000."

                  (d)      The definition of "Consolidated EBITDA" in Section
         1.1 is hereby amended in its entirety so that as amended it shall read
         as follows:

                           "'Consolidated EBITDA' means, with respect to the
                  Borrower and its Subsidiaries for any fiscal quarter period
                  ending on the date of computation thereof, the sum of, without
                  duplication, (i) Consolidated Net Income, plus any losses or
                  minus any gains [*], (ii) Consolidated Interest Expense, (iii)
                  taxes on income, (iv) amortization, (v) depreciation, (vi)
                  amendment fees payable to Lenders when and to the extent
                  actually paid and other actual cash expenses paid in each case
                  in connection with Amendment No. 1 the aggregate of such fees
                  and expenses not to exceed $[*], all determined on a
                  consolidated basis in accordance with GAAP applied on a
                  Consistent Basis."

                  (e)      The definition of "Stated Termination Date" in
         Section 1.1 is hereby amended in its entirety so that as amended it
         shall read as follows:

                           "'Stated Termination Date' means January 15, 2002."

[*] Confidential portion has been omitted and filed separately with the
Commission.


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<PAGE>   3

                  (f)      The definition of "Term Loan Maturity Date" in
         Section 1.1 is hereby amended in its entirety so that as amended it
         shall read as follows:

                           "'Term Loan Maturity Date' means January 15, 2002."

                  (g)      The definition of "Total Revolving Credit Commitment"
         in Section 1.1 is hereby amended in its entirety so that as amended it
         shall read as follows:

                           "'Total Revolving Credit Commitment' means (i) for
                  the period from the date of Amendment No. 1 through September
                  30, 2001 $50,000,000, (ii) for the period October 1, 2001
                  through December 30, 2001 $45,000,000, and (iii) from and
                  after December 31, 2001 $40,000,000, subject to further
                  reduction from time to time in accordance with Section
                  2.2(e)."

                  (h)      Notwithstanding any provision in the Agreement to the
         contrary, from and after the date of Amendment No. 1 the Borrower shall
         only be entitled to request Advances which bear interest at the Base
         Rate and the Borrower shall no longer be entitled to convert Loans
         pursuant to Section 4.2 to Eurodollar Rate Loans. On the effective date
         of Amendment No. 1 all Eurodollar Rate Loans shall be converted to Base
         Rate Loans. The Agreement is hereby amended to eliminate the Borrower's
         option to elect Eurodollar Rate Loans.

                  (i)       Section 9.1 is hereby amended by (i) deleting the
         word "and" appearing at the end of clause (d), (ii) deleting the period
         appearing at the end of clause (g) and inserting in lieu thereof a
         semi-colon, and (iii) adding new clauses (i) and (j) thereto which
         clauses shall read as follows:

                           "(i)     as soon as practical and in any event not
                  later than Wednesday of each week during the period from the
                  date of Amendment No. 1 through March 31, 2001 and thereafter
                  not later than Wednesday of every second week, deliver to the
                  Agent and the Lenders, a weekly (prior to April 1, 2001) and
                  bi-weekly (after March 31, 2001) cash flow report and budget
                  in form acceptable to the Agent; and

                           (j)      no less frequently than once every two weeks
                  following the date of Amendment No. 1 advise the Agent and
                  Lenders by written updates of the status of its efforts to
                  obtain financing to replace the Revolving Credit Facility and
                  Term Loan Facility."

                  (j)      Section 10.1 is hereby amended by deleting Section
         10.1(b), Section 10.1(c) and Section 10.1(d) therefrom and by adding a
         new Section 10.1(b) thereto reading as following:

                           "(b)     Consolidated EBITDA. Permit Consolidated
         EBITDA for the periods set forth below to be less than that amount set
         forth opposite each such period:


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<PAGE>   4

<TABLE>
<CAPTION>
                                            Period                     Amount
                           --------------------------------------      ------
                           <S>                                         <C>
                           2nd fiscal quarter of Fiscal Year 2001      $[*]
                           3rd fiscal quarter of Fiscal Year 2001      ${*]
                           4th fiscal quarter of Fiscal Year 2001      $[*]"
</TABLE>

                  (k)      Section 10.2 is hereby amended in its entirety so
         that as amended it shall read as follows:

                           "10.2    Acquisitions. Enter into any agreement,
                  contract, binding commitment or other arrangement providing
                  for any Acquisition."

                  (l)      Section 10.3 is hereby amended in its entirety so
         that as amended it shall read as follows:

                           "10.3    Capital Expenditures. Make or become
                  committed to make Capital Expenditures which exceed in the
                  aggregate for the Fiscal Year 2001 $4,500,000."

                  (m)      Section 10.7 is hereby amended by (i) inserting the
         word "and" at the end of clause (e), (ii) deleting the semi-colon and
         the word "and" at the end of clause (f) and inserting in lieu thereof a
         period, and (iii) deleting clause (g) in its entirety.

                  (n)      Section 10.9 is hereby amended in its entirety so
         that as amended it shall read as follows:

                           "10.9    Restricted Payments. Make any Restricted
                  Payment or apply or set apart any of their assets therefor or
                  agree to do any of the foregoing."

         3.       Subsidiary Consents. Each Subsidiary of the Borrower that
has delivered a Guaranty to the Agent has joined in the execution of this
Amendment Agreement for the purpose of (i) agreeing to the amendment to the
Agreement and (ii) confirming its guarantee of payment of all the Obligations.

         4.       Representations and Warranties. The Borrower hereby represents
and warrants that:

                  (a)      Except for financial covenant violations herein
         waived, the representations and warranties made by Borrower in Article
         VIII of the Agreement are true on and as of the date hereof except that
         the financial statements referred to in Section 8.6(a) shall be those
         most recently furnished to each Lender pursuant to Section 9.1;

                  (b)      Except for the financial covenant violations herein
         waived, there has been no material adverse change in the condition,
         financial or otherwise, of the Borrower and its Subsidiaries since the
         date of the most recent financial reports of the Borrower

[*] Confidential portion has been omitted and filed separately with the
Commission.


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<PAGE>   5

received by each Lender under Section 9.1 thereof, other than changes in the
ordinary course of business, none of which has been a material adverse change;

                  (c)      The business and properties of the Borrower and its
         Subsidiaries are not and have not been adversely affected in any
         substantial way as the result of any fire, explosion, earthquake,
         accident, strike, lockout, combination of workers, flood, embargo,
         riot, activities of armed forces, war or acts of God or the public
         enemy, or cancellation or loss of any major contracts; and

                  (d)      After giving effect to this Amendment Agreement
         (including the waivers by the Lenders set forth herein), no event has
         occurred and no condition exists which, upon the consummation of the
         transaction contemplated hereby, constitutes a Default or an Event of
         Default on the part of the Borrower under the Agreement, the Notes or
         any other Loan Document either immediately or with the lapse of time or
         the giving of notice, or both.

         5.       Waiver. Each Lender party hereto by its execution of this
Amendment Agreement waives for the period beginning September 30, 2000 through
the effective date of this Amendment Agreement the Event of Default arising by
reason of the Borrower's failure to comply with Section 10.1(b) and Section
10.1(c) of the Agreement.

         6.       Amendment Fee. The Borrower agrees to pay to the Agent for the
benefit of the Lenders which join in the execution of this Amendment Agreement
an amendment fee (the "Amendment Fee") in the amount of $[*], payable as
follows: (i) $[*] on the date of this Amendment Agreement; (ii) $[*] on April 2,
2001; (iii) $[*] on July 2, 2001 and (iv) $[*] on September 1, 2001, which
Amendment Fee shall be fully earned at the date of this Amendment Agreement. In
the event all of the Obligations have been paid in full by April 2, 2001 and the
Facility Termination Date shall have occurred, the April 2, 2001, July 2, 2001
and September 1, 2001 payments will be waived. In the event all Obligations have
been paid in full by July 2, 2001 and the Facility Termination Date shall have
occurred, the July 2, 2001 and September 1, 2001 payments will be waived. In the
event all Obligations have been paid in full by September 1, 2001 and the
Facility Termination Date shall have occurred, the September 1, 2001 payment
will be waived.

         7.       Conditions. This Amendment Agreement shall become effective
upon the Borrower delivering or causing to be delivered to the Agent the
following:

                  (i)      five (5) counterparts of this Amendment Agreement
         duly executed by the Borrower, the Agent and the Required Lenders and
         consented to by each of the Subsidiaries;

                  (ii)     copy of resolutions adopted by the Board of Directors
         of the Borrower and each Guarantor approving this Amendment Agreement
         and authorizing its execution certified by the Secretary or Assistant
         Secretary to be a true and correct copy duly

[*] Confidential portion has been omitted and filed separately with the
Commission.


                                       5
<PAGE>   6

         adopted;

                  (iii)    that portion of the Amendment Fee described in
         paragraph 6(i) above; and

                  (iv)     all other fees and expenses due in connection with
         this Amendment Agreement.

         8.       Acknowledgment; Release. The Borrower and the Guarantors
acknowledge that they have no existing defense, counterclaim, offset,
cross-complaint, claim or demand of any kind or nature whatsoever that can be
asserted to reduce or eliminate all or any part of any of their respective
liability to pay the full indebtedness outstanding under the terms of the
Agreement and any other Loan Documents which evidence, guaranty or secure the
Obligations. The Borrower and the Guarantors hereby release and forever
discharge the Agent, the Lenders and all of their officers, directors,
employees, attorneys, consultants and agents from any and all actions, causes of
action, debts, dues, claims, demands, liabilities and obligations of every kind
and nature, both in law and in equity, known or unknown, whether matured or
unmatured, absolute or contingent.

         9.       Costs and Expenses. The Borrower agrees to pay all costs and
expenses associated with the preparation, due diligence, administration and
enforcement of all documentation executed in connection with the Amendment
Agreement, including without limitation, the legal fees and out-of-pocket
expenses of counsel to the Agent. The Borrower also agrees to pay the expenses
of the Agent and the Lenders in connection with Collateral review, field audits
and retention of consultants.

         10.      Entire Agreement. This Amendment Agreement sets forth the
entire understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements among
the parties relative to such subject matter. No promise, conditions,
representation or warranty, express or implied, not herein set forth shall bind
any party hereto, and no one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto acknowledges that, except
as in this Amendment Agreement otherwise expressly stated, no representations,
warranties or commitments, express or implied, have been made by any other party
to the other. None of the terms or conditions of this Amendment Agreement may be
changed, modified, waived or canceled orally or otherwise, except by writing, in
the manner provided in the Agreement, specifying such change, modification,
waiver or cancellation of such terms or conditions, or of any proceeding or
succeeding breach thereof.

         11.      Full Force and Effect of Agreement. Except as hereby
specifically amended, modified or supplemented, the Agreement and all of the
other Loan Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.

                  [Remainder of page intentionally left blank.]


                                       6
<PAGE>   7

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of the
day and year first above written.

                                     BORROWER:

                                     INSTEEL INDUSTRIES, INC.
WITNESS:

/s/ H.O. Woltz III
-------------------------------      By: /s/ Michael C. Gazmarian
Print Name: H.O. Woltz III           ------------------------------------
           --------------------      Name:  Michael C. Gazmarian
                                     Title: CFO and Treasurer
/s/ Gary D. Kniskern
-------------------------------
Print Name: Gary D. Kniskern
           --------------------


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<PAGE>   8

                                         GUARANTORS:

                                         INSTEEL WIRE PRODUCTS COMPANY
                                         INTERCONTINENTAL METALS CORPORATION
                                         FLORIDA WIRE AND CABLE, INC.

WITNESS:


/s/ H.O. Woltz III
-------------------------------      By: /s/ Michael C. Gazmarian
Print Name: H.O. Woltz III           ------------------------------------
           --------------------      Name:  Michael C. Gazmarian
                                     Title: CFO and Treasurer
/s/ Gary D. Kniskern
-------------------------------
Print Name: Gary D. Kniskern
           --------------------


                                       8
<PAGE>   9


                                         BANK OF AMERICA, N.A., as Agent for the
                                         Lenders


                                         By: /s/ Michael J. Fey
                                            ------------------------------------
                                         Name:  Michael J. Fey
                                         Title: Vice President



                                         BANK OF AMERICA, N.A., as a Lender


                                         By: /s/ Michael J. Fey
                                            ------------------------------------
                                         Name:  Michael J. Fey
                                         Title: Vice President


                                       9

<PAGE>   10

                                         BRANCH BANKING AND TRUST COMPANY



                                         By: /S/ Steven G. Bullard
                                            ------------------------------------
                                         Name:   Steven G. Bullard
                                              ----------------------------------
                                         Title:  Senior Vice President
                                               ---------------------------------


                                       10
<PAGE>   11


                                          FIRST UNION NATIONAL BANK



                                         By: /S/ Nancy S. Jones
                                            ------------------------------------
                                         Name:   Nancy S. Jones
                                              ----------------------------------
                                         Title:  Vice President
                                               ---------------------------------


                                       11
<PAGE>   12

                                         NATIONAL BANK OF CANADA



                                         By: /s/ Alex M. Council IV
                                            ------------------------------------
                                         Name: Alex M. Council IV
                                              ----------------------------------
                                         Title: Vice President
                                               ---------------------------------


                                         By: /s/ Bill Handley
                                            ------------------------------------
                                         Name: Bill Handley
                                              ----------------------------------
                                         Title: Vice President & Manager
                                               ---------------------------------


                                       12