<PAGE>   1


                                                                     Exhibit 4.1

                                                                  EXECUTION COPY



                                THIRD AMENDMENT
                                       TO
                              FINANCING AGREEMENT



         This Third Amendment to Financing Agreement (the "Amendment") is made
as of the 20th day of May, 1998 (the "Effective Date"), by and between Specialty
Chemical Resources, Inc., a Delaware corporation ("Borrower") and Star Bank,
National Association, a national banking association ("Bank").

                                   WITNESSETH:

         WHEREAS, Borrower and Bank have entered into that certain Financing
Agreement, dated as of September 18, 1996, as amended by that First Amendment to
Financing Agreement, dated as of May 22, 1997 and as amended by that Second
Amendment to Financing Agreement, dated as of April 14, 1998 (the "Financing
Agreement"), pursuant to which Bank has made certain financial accommodations
available to Borrower;

         WHEREAS, Borrower hereby acknowledges that it has discussed with Bank
Borrower's need for additional capitalization in the form of an equity
investment, subordinated debt or other form of credit support;

         WHEREAS, Borrower and Bank desire to amend the Financing Agreement as
hereinafter set forth;

         NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Bank and Borrower do hereby agree as
follows:

SECTION 1. DEFINED TERMS.

         Each defined term used herein and not otherwise defined herein shall
have the meaning ascribed to such term in the Financing Agreement.

SECTION 2. AMENDMENT TO SECTION 2 OF THE FINANCING AGREEMENT.

         2.1 SECTION 2.3, TERM LOAN FACILITY, shall be hereby amended by
deleting the existing Section 2.3 in its entirety and by substituting in place
thereof the following Section 2.3:



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<PAGE>   2



                                                                  EXECUTION COPY


                  2.3 Term Loan A Facility. The Term Loan A under the Term Loan
         A Facility will be made, in Bank's good faith discretion, to Borrower
         with respect to its eligible machinery and equipment in an amount of up
         to the lesser of (i) Two Million Six Hundred Eighty Thousand Dollars
         ($2,680,000) and (ii) an amount equal to seventy-five percent (75%) of
         the orderly liquidation value of Borrower's owned machinery and
         equipment on the Effective Date. The principal of Term Loan A shall be
         payable in (i) forty-seven (47) consecutive equal monthly installments
         of Fifty-Five Thousand Eight Hundred Thirty-Three Dollars ($55,833)
         each, commencing on December 1, 1998, and thereafter on the first day
         of each calendar month, with the last payment of principal being in the
         amount of Fifty-Five Thousand Eight Hundred Forty-Nine ($55,849);
         provided, further, that if an Event of Default occurs, the monthly
         payment of the principal of Term Loan A in the above-stated dollar
         amount by Borrower to Bank shall commence no later than the first day
         of the calendar month immediately following the month in which such
         Event of Default occurs and on the first day of each month thereafter;
         provided, however, that notwithstanding the foregoing amortization
         schedule for Term Loan A, upon the effective date of any termination of
         this Agreement pursuant to Section 11 and/or Section 13 hereof, all
         amounts then outstanding under Term Loan A shall become immediately due
         and payable without notice or demand. No repayment or prepayment of
         Term Loan A shall be reason for any relending or additional lending of
         Term Loan A proceeds to Borrower. At Bank's option, the principal of
         Term Loan A shall be payable in accordance with the payment terms set
         forth above in this Section 2.3 by charging or increasing the Revolving
         Loan balance of Borrower.

         2.2 Section 2.5, Term Loan B Facility, shall be amended by deleting
existing Section 2.5 in its entirety and by substituting the following Section
2.5 in place thereof:

                  2.5 Term Loan B Facility. The Term Loan B under the Term Loan
         B Facility has been made to Borrower in the amount of One Million
         Dollars ($1,000,000) on May 22, 1997. The principal of Term Loan B is
         payable in seventeen (17) consecutive equal monthly installments of
         Fifty-Five Thousand Five Hundred Fifty-Five Dollars ($55,555) each,
         commencing on the first day of August, 1997, and thereafter on the
         first day of each calendar month, with the last payment of principal
         being in the amount of the then outstanding and unpaid principal
         balance of Term Loan B. On the Effective Date of this Amendment, Bank
         will, subject to the terms and conditions set forth in the Financing
         Agreement as amended hereby, (i) relend to Borrower an amount equal to
         the principal payment made by Borrower to Bank on May 1, 1998, which
         amount shall be added to the outstanding principal balance of Term Loan
         B, repayable in accordance with the terms hereof, and (ii) contingent
         upon the occurrence of each condition and event set forth in the
         immediately succeeding sentence and in this Financing



                                       2
<PAGE>   3


                                                                  EXECUTION COPY


         Agreement, the regularly scheduled monthly payments of principal of
         Term Loan B due and payable on May 1, 1998, June 1, 1998 and July 1,
         1998 shall be deferred for each respective month in which the
         afore-referenced conditions are met and the amortization schedule for
         principal payments for Term Loan B shall be extended the corresponding
         number of months; provided, however, that if an Event of Default
         occurs, payment of the principal of Term Loan B in the above-stated
         dollar amount shall commence no later than the first day of the
         calendar month immediately following the month in which such Event of
         Default occurs and on the first day of each month thereafter; provided,
         further, that notwithstanding the foregoing amortization schedule for
         Term Loan B, upon the effective date of any termination of this
         Agreement pursuant to Section 11 and/or Section 13 hereof, all amounts
         outstanding under Term Loan B shall become immediately due and payable
         without notice or demand. Subject to the provisions of this Financing
         Agreement and provided that there has not occurred an Event of Default
         at any time on or subsequent to the Effective Date of this Amendment,
         Bank shall (i) relend to Borrower under Term Loam B the amount of One
         Hundred Thousand ($100,000) provided that Borrower's Fixed Charge
         Coverage Ratio (excluding capital expenditures made by Borrower during
         the period) for the period from and including March 1, 1998 through
         and including April 30, 1998 shall not be less than 1.00 to 1.00; (ii)
         relend to Borrower under Term Loan B the amount of One Hundred Thousand
         Dollars ($100,000) provided that Borrower's Fixed Coverage Ratio for
         the period from and including May 1, 1998 through and including May 31,
         1998 shall not be less than 1.00 to 1.00, and (iii) relend to Borrower
         under Term Loan B the amount of One Hundred Thousand ($100,000)
         provided that Borrower's Fixed Charge Ratio for the period from and
         including June 1, 1998 through and including June 30, 1998 shall not be
         less than 1.00 to 1.00. All amounts relent by Bank to Borrower pursuant
         to the immediately preceding sentence shall be added to the principal
         amount of Term Loan B and shall bear interest at the rate and be repaid
         in accordance with the terms and conditions set forth in this Financing
         Agreement. No repayment or prepayment of Term Loan B shall be any
         reason for any relending or additional lending of Term Loan B proceeds
         to Borrower other than as specifically set forth herein. At Bank's
         option, the principal of Term Loan B shall be payable in accordance
         with the payment terms set forth in this Section 2.5 by charging or
         increasing the Revolving Loan balance of Borrower. The Term Loan B may
         be prepaid at any time by Borrower to Bank without penalty.

         2.3 Section 2.11 of the Financing Agreement shall be deleted in its
entirety and the following new Section 2.11 shall be substituted in place
thereof:

                  2.11 Excess Cash Flow Recapture. Each six (6) month period
         during the term of this Agreement in which Term Loan A and/or Term Loan
         B shall remain outstanding, Borrower shall make a payment to Bank
         ("Semi-Annual Cash Flow Payment") in an amount equal to a percent of
         Borrower's Excess Cash Flow (as defined in Addendum to Exhibit L
         attached hereto and incorporated herein by 



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<PAGE>   4



                                                                  EXECUTION COPY


         reference) for the applicable fiscal period ("Semi-Annual Cash Flow
         Payment Amount"). The Semi-Annual Cash Flow Payment Amount with respect
         to (x) from and including July 1 through and including December 31 and
         (y) from and including January 1 through and including June 30 of each
         fiscal year of Borrower, shall be an amount equal to fifty percent
         (50%) of Borrower's Excess Cash Flow for such period of Borrower.
         Borrower's Excess Cash Flow for the applicable period referred to above
         shall be calculated on and due and payable on the first (1st) Business
         Day after the earlier to occur of(i) the date on which Borrower shall
         have actually delivered the financial information required to be
         delivered under Section 8.5 hereof, and (ii) the date on which such
         financial information is required to be delivered by Borrower in
         accordance with the terms of Section 8.5 hereof (any such date on which
         such calculation shall be made being referred to herein as the "Cash
         Flow Calculation Date"); provided, however, that Borrower will not be
         obligated to make a Semi-Annual Cash Flow Payment with respect to Term
         Loan A until the first Cash Flow Calculation Date immediately following
         the period of January 1, 1999 through and including June 30, 1999. Each
         payment in respect of an Semi-Annual Cash Flow Payment Amount shall, at
         Bank's sole determination, be applied to the monthly Term Loan A and/or
         the monthly Term Loan B payments in inverse order of maturity until
         each Term Loan A and Term Loan B shall have been paid in full. Borrower
         shall continue to make Annual Cash Flow Payments in accordance with
         this Section 2.11 until each Term Loan A and Term Loan B shall have
         been paid in full. Each payment in respect of an Annual Cash Flow
         Payment Amount shall be payable by charging or increasing the Revolving
         Loan balance of Borrower.

SECTION 3. AMENDMENT TO SECTION 15. MISCELLANEOUS

                  3.1 Section 15.8 of the Financing Agreement shall be amended
by deleting the last sentence thereof in its entirety and by substituting the
following sentence in place thereof: "The Obligations described under this
Section 15.8 and under Section 15.16 below shall survive any termination of this
Agreement."

                  3.2 Section 15 to the Financing Agreement shall be amended by
adding new Section 15.16 as follows:

                  15.16 Deferred Amortization Fee. Borrower shall pay to Bank
         deferred amortization fee (the "Deferred Amortization Fee"), which
         Deferred Amortization Fee shall be Twenty-Five Thousand Dollars
         ($25,000), due and payable in four (4) consecutive monthly payments of
         Six Thousand Two Hundred Fifty Dollars ($6,250.00) each, with the first
         payment being due and payable on September 1, 1998 and thereafter on
         October 1, 1998, November 1, 1998 and December 1, 1998. Failure of
         Borrower to make any such Deferred Amortization Fee payment when the
         same is due and payable shall constitute an Event of Default under
         the Financing Agreement, as amended hereby.



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<PAGE>   5



                                                                  EXECUTION COPY


Section 4. ADDENDUM TO EXHIBIT L:

         Exhibit L shall be amended by adding thereto the Addendum to Exhibit L
Financial Covenants, attached hereto and incorporated by reference herein.

SECTION 5. SECTION 10 REPRESENTATIONS AND WARRANTIES.

         In order to induce Bank to enter into this Amendment and in addition to
all of the representations, warranties and covenants made by Borrower under the
Financing Agreement and Loan Documents, Borrower hereby represents, warrants and
covenants that, as of the date hereof, any date upon which a Loan is made
hereunder, and until the Obligations are fully paid, performed and satisfied,
the representations, warranties and covenants set forth in the Financing
Agreement and herein are and shall remain true. The Borrower further hereby
represents arid warrants to Bank as follows:

                  5.1 The Amendment. This Amendment has been duly and validly
         executed by an authorized executive officer of Borrower and constitutes
         the legal, valid and binding obligation of Borrower enforceable against
         Borrower in accordance with its terms.

                  5.2 Financing Agreement. The Financing Agreement, as amended
         by this Amendment, remains in full force and effect and remains the
         valid and binding obligation of Borrower enforceable against Borrower
         in accordance with its terms. Borrower hereby ratifies and confirms the
         Financing Agreement as amended by this Amendment.

                  5.3 Nonwaiver. Except as specifically set forth in this
         Amendment, the execution, delivery, performance and effectiveness of
         this Amendment shall not operate nor be deemed to be nor construed as a
         waiver (i) of any right, power or remedy of Bank under the Financing
         Agreement, nor (ii) of any term, provision, representation, warranty or
         covenant contained in the Financing Agreement or any other
         documentation executed in connection therewith. Further, except as
         specifically set forth in this Amendment, none of the provisions of
         this Amendment shall constitute, be deemed to be or construed as, a
         waiver of any Event of Default under the Financing Agreement as amended
         by this Amendment.

                  5.4 Reaffirmation of Representations, Warranties and
         Covenants. Borrower hereby reaffirms and agrees to be bound by all
         representations, warranties and covenants made or entered into by it
         under the Financing Agreement and under any and all Loan Documents.
         Borrower hereby represents and warrants to Bank that no Default or
         Event of Default shall exist as of the date of this Amendment after
         giving effect to this Amendment and none shall be caused to exist as a
         result of the execution, delivery and performance by Borrower of this
         Amendment.



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<PAGE>   6



                                                                  EXECUTION COPY


                  5.5 Reference to and Effect on the Financing Agreement. Upon
         the effectiveness of this Amendment, each reference in the Financing
         Agreement to "this Agreement"; "hereunder", "hereof", "herein", or
         words of like import shall mean and be a reference to the Financing
         Agreement, as amended hereby, and each reference to the Financing
         Agreement in any other document, instrument or agreement executed
         and/or delivered in connection with the Financing Agreement shall mean
         and be a reference to the Financing Agreement, as amended hereby.

SECTION 6. CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS AMENDMENT.

         In addition to all of the other conditions and agreements set forth
herein, the effectiveness of this Amendment is subject to each of the following
conditions precedent:

                  6.1 Amendment to Financing Agreement. Bank shall have received
         an original counterpart of this Third Amendment to Financing Agreement
         executed and delivered by a duly authorized officer of Borrower.

                  6.2 Resolutions. Bank shall have received certified
         resolutions of Borrower authorizing Borrower to execute, deliver and
         perform this Amendment.

                  6.3 No Material Adverse Change. There shall have occurred no
         material and adverse change in the Borrower's assets, liabilities or
         financial condition since the date of the last Financials delivered by
         Borrower to Bank nor shall there have been any material damage to or
         loss of any of Borrower's assets or properties since such date.

                  6.4 Capitalization. Borrower shall have fully-consummated the
         Capitalization Plan in a form acceptable to Bank in its sole discretion
         and shall have received, at a minimum, (a) Four Hundred Fifty Thousand
         Dollars ($450,000) cash on the Effective Date of this Amendment and (b)
         the total amount of Five Hundred Fifty Thousand Dollars ($550,000) cash
         (collectively, the "Capitalization Cash") no later than June 15, 1998.
         Failure of Borrower to receive the full amount of the Capitalization
         Cash by June 15, 1998 shall constitute an Event of Default under the
         Financing Agreement, as amended hereby, and Borrower shall immediately
         repay to Bank the amount of the principal payments relent by Bank to
         Borrower as described at Section 2.5 above, as a result thereof.

SECTION 7. MISCELLANEOUS.

                  7.1 Governing Law. This Amendment shall be governed by and
         construed in accordance with the law of the State of Ohio, without
         regard to principles of conflict of law.



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<PAGE>   7



                                                                  EXECUTION COPY


                  7.2 Severability. In the event any provision of this Amendment
         should be invalid, the validity of the other provisions hereof and of
         the Financing Agreement shall not be affected thereby.

                  7.3 Counterparts. This Amendment may be executed in one or
         more counterparts, each of which, when taken together, shall constitute
         but one and the same agreement.

                  7.4 Confession of Judgment. Borrower hereby irrevocably
         authorizes and empowers any attorney-at-law to appear for Borrower in
         any action upon or in connection with this Amendment or the Financing
         Agreement, as amended hereby, at any time after the Loans and/or other
         Obligations become due, as herein provided, in any court in or of the
         State of Ohio or elsewhere, and waives the issuance and service of
         process with respect thereto, and irrevocably authorizes and empowers
         any such attorney-at-law to confess judgment in favor of Bank against
         Borrower, the amount due thereon or hereon, plus interest as herein
         provided, and all costs of collection, and waives and releases all
         errors in said proceedings and judgments and all rights of appeal from
         the judgment rendered. The Borrower agrees and consents that the
         attorney confessing judgment on behalf of the Borrower may also be
         counsel to Bank or any of Bank's Affiliates, waives any conflict of
         interest which might otherwise arise, and consents to Bank paying such
         confessing attorney a reasonable legal fee or allowing such attorney's
         reasonable fees to be paid from the proceeds of Collateral, the
         Premises or any other security for the Loans and the other Obligations.




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<PAGE>   8



                                                                  EXECUTION COPY



         IN WITNESS WHEREOF, Borrower has caused this Third Amendment to
Financing Agreement to be duly executed and delivered by its duly authorized
officer as of the date first above written.

WARNING - BY SIGNING THIS PAPER YOU GIVE UP OUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR RETURNED
GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT, OR ANY
OTHER CAUSE.

         Signed in /s/ CLEVELAND, Ohio on May /s/ 20, 1998.
                   -------------              ------


Signed and acknowledged                      SPECIALTY CHEMICAL RESOURCES,
in the presence of:                          INC.


-----------------------------
Name:                                        By: /s/ DAVID F. SPINK
     ------------------------                    ------------------------
                                             Its:/s/ CFO
                                                 ------------------------
-----------------------------
Name:
     ------------------------




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<PAGE>   9



                                                                  EXECUTION COPY
STATE OF OHIO       )
                    )  ss:
COUNTY OF           )
          ----------

         The foregoing instrument was acknowledged before me this 20th day of
May, 1998, by David F. Spink, Chief Financial Officer of Specialty Chemical
Resources, Inc., a Delaware corporation, on behalf of the corporation.


                                               ------------------------------
                                               Notary Public


Accepted at Cincinnati, Ohio 
as of May /s/ 20, 1998.
          ------

STAR BANK, NATIONAL ASSOCIATION

By: /s/ SUSAN GEIGER
   -----------------


Its: /s/ VICE PRESIDENT
     ------------------






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<PAGE>   10



                              ADDENDUM TO EXHIBIT L

                               Financial Covenants

Financial Covenants. Borrower agrees that it shall

(A)    Capital Expenditures. Not make capital expenditures (including, but not
       by way of limitation, expenditures for fixed assets or leases capitalized
       or required to be capitalized on Borrower's books by purchase,
       lease-purchase agreement, option or otherwise) in an aggregate amount
       exceeding (i) $1,000,000 for the fiscal year ending December 31, 1997,
       (ii) Nine Hundred Thousand ($900,000) for the fiscal year ending December
       31, 1998 and (iii) $1,000,000 for each fiscal year, thereafter.

(B)    Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA).
       Not permit Borrower's Earnings Before Interest, Taxes, Depreciation, and
       Amortization ("EBITDA") to be less than the following amounts for the
       following periods:

              EBITDA                              Periods
              ------                              -------
             $740,000                       04/01/98 to 06/30/98
             $850,000                       07/01/98 to 09/30/98
             $800,000                       10/01/98 to 12/31/98

(C)    Fixed Charge Coverage Ratio. Not permit Borrower's ratio of EBITDA to its
       Fixed Charges ("Fixed Charge Coverage Ratio") (excluding (i) any amounts
       relent by Bank to Borrower under Section 2.5 hereof and (ii) the
       Capitalization Cash actually received by Borrower) to be less than the
       following:

         Fixed Charge Coverage Ratio              Period
         ---------------------------              ------
                1.00 to 1.00                04/01/98 to 06/30/98
                1.00 to 1.00                07/01/98 to 09/30/98
                1.00 to 1.00                10/01/98 to 12/31/98


(D)    Tangible Net Worth. Not permit Borrower's tangible net worth to be less
       than the following amounts at any time by and after the following
       periods:

            Tangible Net Worth                      Date
            ------------------                      ----
               $8,000,000                         06/30/98
               $8,650,000                         09/30/98
               $9,100,000                         12/31/98



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<PAGE>   11



(E)    Ratio of Total Liabilities to Tangible Net Worth. Not permit Borrower's
       ratio of Total Liabilities to Tangible Net Worth to exceed the following
       ratios on or after the following dates:

          Ratio of Total Liabilities To
               Tangible Net Worth                   Date
               ------------------                   ----
                 2.69 to 1.00                     06/30/98
                 2.32 to 1.00                     09/30/98
                 2.01 to 1.00                     12/31/98









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<PAGE>   12



                     II. Definitions to Financial Covenants

(A)    The term "Earnings Before Interest, Taxes, Depreciation and Amortization"
       or "EBITDA" for purposes of this Exhibit L shall mean Borrower's earnings
       from operations before income taxes, and interest or expense, plus
       depreciation, plus amortization of all non-cash charges, all as
       determined in accordance with generally accepted accounting principles on
       a FIFO basis, and shall not include any gains from the sale of assets
       outside the normal course of business or any other gains from
       extraordinary accounting adjustments or non-recurring items.

(B)    The term "Fixed Charge" for purposes of this Exhibit L shall mean
       Borrower's cash interest expense, scheduled principal payments on debt
       (including, but not limited to, the amount of principal payments on (i)
       Term Loan A actually deferred for the months of May, June and July, 1998
       and (ii) Term Loan B actually deferred for the months of May, June and
       July, 1998), dividends, capitalized lease payments, capital expenditures,
       prepayments or redemption of principal on subordinated debt, preferred
       stock or common stock, tax, cash taxes paid.

(C)    The term "Tangible Worth" for purposes of this Exhibit L, shall mean the
       total of Borrower's book net worth, as determined in accordance with
       generally accepted accounting principles, consistently applied, plus any
       debt subordinate to Borrower's debt to Bank, plus any preferred stock
       less any assets considered intangible.

(D)    The term "Total Liabilities" for purposes of this Exhibit L shall
       include any contingent liabilities and shall have the meaning and be
       determined in accordance with generally accepted accounting principles
       consistently applied in accordance with past practice. The portion of any
       debt subordinate to Borrower's debt to Bank shall be excluded from Total
       Liabilities.

(E)    The term "Excess Cash Flow" shall mean EBITDA less Fixed Charges.


Upon receipt of fiscal 1999 and 2000 projections as required at Section 8.6
hereof Financial Covenants set forth herein will be established, upon terms
satisfactory to Bank.




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<PAGE>   13



                       III. Interest Rate Reduction Tests


<TABLE>
<CAPTION>
                                                                                              Applicable Interest  
                                                                                                      Rate         
         <S>     <C>                                                                                <C>
         1)       Fixed Charge Coverage for previous four fiscal quarter period
         2)       Total Liabilities/Tangible Net Worth
         3)       Tangible Net Worth


         1)       1.30-1.59
                  and                                                                                P + 1.00%
         2)       1.86-2.00
                  and
         3)       $8,000,000 - $8,499,000

         1)       1.60-1.79
                  and                                                                                P + 0.50%
         2)       1.71-1.85
                  and
         3)       $8,500,000 - $8,999,000

         1)       1.80 and greater
                  and                                                                                P + 0.00%
         2)       Less than 1.70
                  and
         3)       $9,000,000 and greater

</TABLE>





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