<PAGE>   1

===============================================================================


                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q



             [X] Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934



                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000


                                       or



             [ ] Transition Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                 For the transition period from _____ to _____



                          COMMISSION FILE NO. 1-13394

                             CHASE INDUSTRIES INC.
             (Exact name of Registrant as specified in its charter)


            DELAWARE                                           51-0328047
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                          Identification Number)


                14212 COUNTY ROAD M-50, MONTPELIER, OHIO 43543
         (Address of principal executive offices, including Zip Code)


       Registrant's telephone number, including area code: (419) 485-3193

                                 Not Applicable
              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.


                               YES [X]   NO [ ]

<TABLE>
<S>                                                                                                    <C>
NUMBER OF SHARES OF COMMON STOCK OUTSTANDING AS OF AUGUST 7, 2000..................................... 9,127,777
NUMBER OF SHARES OF NONVOTING COMMON STOCK OUTSTANDING AS OF AUGUST 7, 2000........................... 6,150,118*
</TABLE>


---------

* The Registrant's Nonvoting Common Stock is convertible, on a share-for-share
basis, into Common Stock.

===============================================================================

<PAGE>   2


                             CHASE INDUSTRIES INC.

                               TABLE OF CONTENTS


<TABLE>
<CAPTION>
                         PART I. FINANCIAL INFORMATION

                                                                                                                Page
                                                                                                                ----
<S>                                                                                                           <C>
Item 1.          Financial Statements (Unaudited):

                 Consolidated Balance Sheet as of June 30, 2000
                           and December 31, 1999..............................................................   3

                 Consolidated Statement of Income for the Three and Six Months Ended
                           June 30, 2000 and 1999.............................................................   4

                 Consolidated Statement of Cash Flows for the Six Months Ended
                           June 30, 2000 and 1999.............................................................   5

                 Notes to Consolidated Financial Statements...................................................   6

Item 2.          Management's Discussion and Analysis of Financial Condition
                 and Results of Operations  ..................................................................  14


                           PART II. OTHER INFORMATION


Item 1.          Legal Proceedings...........................................................................   23

Item 4.          Submission of Matters to a Vote of Security Holders.........................................   24

Item 6.          Exhibits and Reports on Form 8-K............................................................   25

                 Signature...................................................................................   27
</TABLE>



                                       2

<PAGE>   3



                             CHASE INDUSTRIES INC.
                           CONSOLIDATED BALANCE SHEET
              (UNAUDITED; IN THOUSANDS, EXCEPT SHARE INFORMATION)

<TABLE>
<CAPTION>
                                                                                       June 30,       December 31,
                                                                                         2000             1999
                                                                                     ------------     ------------
<S>                                                                                  <C>              <C>
                                     ASSETS
Current assets:
  Cash and cash equivalents                                                          $      1,754     $      9,142
  Receivables, net of allowance for doubtful accounts and
    claims of $1,232 and $1,190 in 2000 and 1999, respectively                             38,975           33,384
  Inventories                                                                              46,872           45,230
  Prepaid expenses                                                                          1,585            4,609
  Deferred income taxes                                                                     3,380            3,341
                                                                                     ------------     ------------
      Total current assets                                                                 92,566           95,706
Property, plant and equipment, net                                                        124,337          121,058
Other assets                                                                               12,883           12,808
                                                                                     ------------     ------------
      Total assets                                                                   $    229,786     $    229,572
                                                                                     ============     ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                                                   $     26,539     $     31,588
  Accrued compensation and benefits                                                         6,899            8,167
  Accrued income taxes                                                                      2,376            2,714
  Other accrued liabilities                                                                 8,565           10,890
  Current portion of long-term debt                                                           172              163
                                                                                     ------------     ------------
      Total current liabilities                                                            44,551           53,522
Long-term debt                                                                             22,085           27,175
Deferred income taxes                                                                      18,239           14,829
                                                                                     ------------     ------------
      Total liabilities                                                                    84,875           95,526
                                                                                     ------------     ------------
Commitments and contingencies                                                                --               --
                                                                                     ------------     ------------

Stockholders' equity:
  Common stock, $.01 par value, 36,310,000 shares authorized; 9,119,377 and
    9,084,877 shares issued and outstanding
    in 2000 and 1999, respectively                                                             92               91
  Nonvoting common stock, $.01 par value, 12,300,000 shares
    authorized; 6,150,118 shares issued and outstanding
    in 2000 and 1999                                                                           61               61
  Additional paid-in capital                                                               31,761           31,504
  Retained earnings                                                                       112,997          102,390
                                                                                     ------------     ------------
      Total stockholders' equity                                                          144,911          134,046
                                                                                     ------------     ------------
      Total liabilities and stockholders' equity                                     $    229,786     $    229,572
                                                                                     ============     ============
</TABLE>


               The accompanying notes are an integral part of the
                       consolidated financial statements.


                                       3

<PAGE>   4



                             CHASE INDUSTRIES INC.
                        CONSOLIDATED STATEMENT OF INCOME
              (UNAUDITED; IN THOUSANDS, EXCEPT SHARE INFORMATION)


<TABLE>
<CAPTION>
                                                    Three Months Ended        Six Months Ended
                                                         June 30,                 June 30,
                                                    2000         1999         2000         1999
                                                  --------     --------     --------     --------
<S>                                               <C>          <C>          <C>          <C>
Net sales                                         $101,624     $ 97,577     $216,217     $201,445

Cost of goods sold (exclusive of depreciation
   and amortization shown separately below)         86,471       81,783      184,935      169,143

Lower of cost-or-market inventory writedown           --           --           --          1,800
                                                  --------     --------     --------     --------

    Gross profit                                    15,153       15,794       31,282       30,502

Selling, general and administrative expenses         3,530        4,443        7,135        8,702

Depreciation and amortization                        3,206        2,880        6,207        5,697
                                                  --------     --------     --------     --------

    Operating income                                 8,417        8,471       17,940       16,103

Interest expense, net                                  464          314          831          830
                                                  --------     --------     --------     --------

    Income before income taxes                       7,953        8,157       17,109       15,273

Provision for income taxes                           3,022        3,100        6,501        5,804
                                                  --------     --------     --------     --------

    Net income                                    $  4,931     $  5,057     $ 10,608     $  9,469
                                                  ========     ========     ========     ========

Earnings per share:

    Basic                                         $   0.32     $   0.33     $   0.70     $   0.62
                                                  ========     ========     ========     ========
    Diluted                                       $   0.32     $   0.33     $   0.69     $   0.62
                                                  ========     ========     ========     ========
</TABLE>


               The accompanying notes are an integral part of the
                       consolidated financial statements.


                                       4

<PAGE>   5


                             CHASE INDUSTRIES INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                           (UNAUDITED; IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                       Six Months Ended June 30,
                                                                        2000              1999
                                                                    ------------      ------------
<S>                                                                 <C>               <C>
   Operating activities:
     Net income                                                     $     10,608      $      9,469
     Adjustments to reconcile net income to net cash
       provided by operating activities:
        Depreciation and amortization                                      6,207             5,697
        Deferred income tax expense (benefit)                              3,371              (433)
        Lower of cost-or-market inventory writedown                         --               1,800
        Changes in assets and liabilities:
           (Increase) in receivables                                      (5,591)           (3,442)
           (Increase) decrease in inventories                             (1,642)           23,479
           (Decrease) in accounts payable                                 (5,049)          (12,708)
           (Decrease) in accrued liabilities                              (3,931)             (381)
           Other, net                                                      2,632            (3,124)
                                                                    ------------      ------------
               Net cash provided by operating activities                   6,605            20,357
                                                                    ------------      ------------

Investing activities:
     Expenditures for property, plant and equipment                       (9,169)          (11,909)
                                                                    ------------      ------------
               Net cash (used in) investing activities                    (9,169)          (11,909)
                                                                    ------------      ------------

Financing activities:
     Revolving credit facility borrowings, net                             2,044              --
     Repayment of term loan                                               (7,000)             --
     Principal payments on long-term debt                                   (125)             (117)
     Issuance of common stock - options exercised                            257                 6
                                                                    ------------      ------------
               Net cash (used in) financing activities                    (4,824)             (111)
                                                                    ------------      ------------

Net (decrease) increase in cash and cash equivalents                      (7,388)            8,337

Cash and cash equivalents, beginning of period                             9,142             9,200
                                                                    ------------      ------------

Cash and cash equivalents, end of period                            $      1,754      $     17,537
                                                                    ============      ============

Supplemental disclosures:
     Interest and bank fees paid                                    $        349      $        321
                                                                    ============      ============

     Income taxes paid                                              $         40      $      7,159
                                                                    ============      ============
</TABLE>


               The accompanying notes are an integral part of the
                       consolidated financial statements.


                                       5

<PAGE>   6



                             CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)



1.       SIGNIFICANT ACCOUNTING POLICIES:

         PRINCIPLES OF CONSOLIDATION AND INTERIM FINANCIAL INFORMATION

         The consolidated balance sheet as of June 30, 2000, and December 31,
1999, and the consolidated statements of income and cash flows for the three
and six months ended June 30, 2000 and 1999, include the accounts of Chase
Industries Inc. (the "Company"), a Delaware corporation, and its wholly-owned
subsidiaries, Chase Brass & Copper Company, Inc. ("CBCC"), a Delaware
corporation, Leavitt Tube Company, Inc. ("Leavitt"), a Delaware corporation,
and Holco Corporation ("Holco"), an Illinois corporation and wholly-owned
subsidiary of Leavitt. All significant intercompany transactions have been
eliminated in consolidation.

         The accompanying consolidated financial statements have been prepared
in accordance with instructions for Form 10-Q and do not include all the
information and footnote disclosures required by generally accepted accounting
principles. The financial information for June 30, 2000 and 1999, included
herein is unaudited and, in the opinion of management, reflects all adjustments
necessary for a fair presentation of such financial information.

         The results of operations for the three and six months ended June 30,
2000, are not necessarily indicative of the results of operations that may be
expected for the year ending December 31, 2000. This quarterly report on Form
10-Q should be read in conjunction with the annual consolidated financial
statements included in the Company's Annual Report on Form 10-K for the year
ended December 31, 1999.

         On August 30, 1996, the Company acquired, through Leavitt, the assets
and operations of the steel tube division of UNR Industries, Inc., including
all the outstanding stock of Holco (the "Leavitt Acquisition"). Upon
consummation of the Leavitt Acquisition, Leavitt continued operations in the
manufacture and sale of structural and mechanical steel tubing and structural
pipe. The Leavitt Acquisition was accounted for as a purchase.

         On August 24, 1990, the Company acquired, through CBCC, the assets and
operations of a Delaware corporation formerly named Chase Brass & Copper
Company, Incorporated ("Old Chase"), pursuant to the Asset Purchase Agreement
("CBCC Purchase Agreement") dated May 10, 1990, by and between the Company,
CBCC, Old Chase, BP Exploration (Alaska) Inc. ("BPE") and The Standard Oil
Company (the "CBCC Acquisition"). BPE and The Standard Oil Company
(collectively referred to as "BP") own all the stock of Old Chase. The CBCC
Acquisition was accounted for as a purchase.


                                       6

<PAGE>   7

                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

         RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

         In June 1998, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities," ("SFAS 133"), which was
originally effective for years beginning after June 15, 1999. In June 1999, the
FASB issued Statement of Accounting Standards No. 137 delaying the effective
date of SFAS 133 by one year. The new standard requires companies to record
derivatives on the balance sheet as assets or liabilities, measured at fair
value. Management of the Company believes SFAS 133 will not have a material
effect on its financial position or results of operations.

2.       INVENTORIES:

         Inventories are stated at the lower of cost-or-market, with cost
determined on the last-in, first-out (LIFO) basis. In prior periods inventories
have been written down to lower of cost-or-market and such reduced amounts are
considered cost for subsequent years. During first quarter 1999, the Company
recorded a non-cash inventory writedown of $1.8 million. This writedown was due
to decreasing flat-rolled steel prices.

         If the first-in, first out (FIFO) method for determining cost had been
used, inventories would have been approximately $2.4 million higher at June 30,
2000, and $1.2 million lower at December 31, 1999. Inventories consisted of the
following (in thousands):

<TABLE>
<CAPTION>
                                          June 30,        December 31,
                                            2000              1999
                                        ------------      ------------
<S>                                     <C>               <C>
Raw materials                           $     19,163      $     12,091
Work in progress                               7,701            11,462
Finished goods                                21,127            22,552
                                        ------------      ------------
                                              47,991            46,105
Tolling metal due customers                   (1,119)             (875)
                                        ------------      ------------
                                        $     46,872      $     45,230
                                        ============      ============
</TABLE>

3.       COMMON STOCK AND EARNINGS PER SHARE:

         The following is a reconciliation of the denominator used in the
computation of basic and diluted earnings per share. Average shares were as
follows:


<TABLE>
<CAPTION>
                                      Three Months Ended June 30,
                                      ---------------------------
                                   2000                          1999
                                   ----                          ----
                           Shares           EPS          Shares           EPS
                         ----------     ----------     ----------     ----------
<S>                      <C>            <C>            <C>            <C>
Basic                    15,257,785     $     0.32     15,234,260     $     0.33
Stock options               132,837           --           92,238           --
                         ----------     ----------     ----------     ----------
Diluted                  15,390,622     $     0.32     15,326,498     $     0.33
                         ==========     ==========     ==========     ==========
</TABLE>



                                       7

<PAGE>   8


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                         Six Months Ended June 30,
                                         -------------------------
                                    2000                           1999
                                    ----                           ----
                           Shares           EPS           Shares           EPS
                           ------           ---           ------           ---
<S>                      <C>            <C>             <C>            <C>
Basic                    15,246,390     $     0.70      15,234,078     $     0.62
Stock options               122,485          (0.01)        108,062           --
                         ----------     ----------      ----------     ----------
Diluted                  15,368,875     $     0.69      15,342,140     $     0.62
                         ==========     ==========      ==========     ==========
</TABLE>


         All shares of Common Stock and Nonvoting Common Stock are identical,
except that holders of Nonvoting Common Stock have no voting rights. Shares of
Nonvoting Common Stock may be converted, at the option of the holder, into
Common Stock on a share-for-share basis, except to the extent that the holder
of Nonvoting Common Stock is restricted from obtaining certain ownership levels
in the Company pursuant to the Small Business Investment Act of 1958 and the
Bank Holding Company Act of 1956.

         At June 30, 2000, and December 31, 1999, the Company had no preferred
stock issued or outstanding. In conjunction with the initial public offering in
November 1994, the Company authorized 1,000,000 shares of preferred stock, none
of which has been issued. The preferences and rights of such preferred stock
may be determined by the Board of Directors at any time prior to issuance.

4.       COMMITMENTS AND CONTINGENCIES:

         Both CBCC and Leavitt are subject to certain contingent environmental
liabilities. These contingent liabilities are described separately below.

         CBCC. Preliminary studies conducted immediately prior to the CBCC
Acquisition indicated that certain areas of the site upon which CBCC's
manufacturing facility is located have been contaminated with certain volatile
organic compounds ("VOCs") as well as total petroleum hydrocarbons and certain
metals from historical operating practices. In connection with the CBCC
Acquisition the Company and BP entered into a remediation agreement (the
"Remediation Agreement"). Under the terms of the Remediation Agreement, BP is
responsible for certain remediation activities attributable to environmental
releases which occurred prior to the CBCC Acquisition at CBCC's manufacturing
facility. BP also is obligated under the CBCC Purchase Agreement to indemnify
the Company for liabilities arising out of certain environmental conditions
that existed as of the CBCC Acquisition date. BP has performed certain
activities in this regard and has acknowledged liability for certain releases
of regulated substances into the environment which occurred prior to the CBCC
Acquisition. BP also is obligated under the CBCC Purchase Agreement to
indemnify the Company for liabilities arising out of certain environmental
conditions that existed as of the CBCC Acquisition date.


                                       8

<PAGE>   9


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

         CBCC initiated interim remedial actions for a portion of CBCC's site
in second quarter 1999. Sampling conducted as part of these interim remedial
actions identified the presence of VOCs that were not covered by the initial
scope of these interim actions. As a result, CBCC conducted additional sampling
at certain areas of the site to further delineate the contamination in those
areas. Based on the aggregate sampling results, CBCC modified its 1999
remediation plan. CBCC began implementing the modified plan in first quarter
2000. As of June 30, 2000, the estimated remaining costs for these remediation
activities, which CBCC expects to complete in fourth quarter 2000, range from
approximately $2.8 million to $5.7 million depending on the use of certain of
remediation methodologies, quantities of material generated and disposal
options that may be permitted and/or available.

         CBCC also is in the process of developing a remediation plan for two
additional areas of its site, and expects to initiate remediation activities at
those areas in 2001. Based on preliminary cost estimates provided by CBCC's
independent environmental consultant, and subject to the development by the
consultant of a remediation plan for these areas of the site and the receipt of
bids for the remediation activities required under such plan, the Company
estimates the cost for this project will range from approximately $1.3 million
to $3.9 million.

         Based on currently available data and the current status of
remediation activities, the Company is unable to determine the most likely
estimated cost (within the ranges provided) for these projects. As a result,
based on the current cost estimates, in second quarter 2000 the Company
increased by $0.3 million its previously established reserve for costs
associated with these remediation activities, which increase was more than
offset by payments of remediation costs previously reserved against. The
resulting $4.1 million reserve amount is at the low end of these ranges in
accordance with Financial Accounting Standards Board Interpretation No. 14,
"Reasonable Estimation of the Amount of a Loss." Based on BP's obligations
under the Remediation Agreement and the CBCC Purchase Agreement, the Company
also recorded in second quarter 2000 a corresponding $0.3 million addition to
the receivable from BP.

         Based on currently available data, the Company believes that upon
completion of the remediation activities described above CBCC will have
substantially completed the remediation activities that the Company believes
are necessary to address contamination at CBCC's site. However, until the
completion of these remedial and associated investigatory activities and
receipt of approval from the Ohio Environmental Protection Agency (the "Ohio
EPA") of CBCC's activities to remediate this contamination, the Company cannot
be certain that further remediation activities will not be required at CBCC's
site.

         Although BP has acknowledged its contractual obligation to fund
certain investigatory and cleanup activities related to site contamination
attributable to Old Chase's operations and has performed certain activities in
this regard, as discussed below BP and CBCC currently are involved in
litigation regarding, among other things, the extent of BP's obligations under
the Remediation Agreement and the CBCC Purchase Agreement. BP has not yet
reimbursed CBCC for costs incurred by CBCC for the remediation activities
previously conducted by CBCC, and CBCC has funded these activities with cash
flows provided by operating activities and the Company's existing bank credit


                                       9

<PAGE>   10


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

facility (the "Bank Credit Facility"), as necessary. To the extent BP fails to
fund current and future remediation activities at CBCC's manufacturing
facility, CBCC also will be required to fund these activities. However, to the
extent CBCC is required to fund cleanup costs related to current and future
remediation activities at its manufacturing facility, the Company believes it
would be able to fund these costs with cash on hand and borrowings under its
existing Bank Credit Facility. Therefore, the Company does not believe that
funding these remediation activities will have a material effect on the
Company's financial condition, results of operations or liquidity.

         Based on the status of remediation activities, other than as described
above, no reserves have been established regarding the aforementioned matters.
Additionally, the Company expects no material impact on its financial position,
results of operations or liquidity as a result of the existence of any other
environmental conditions related to CBCC.

         The Company notified BP in third quarter 1999 that amounts payable by
the Company under the $20 million promissory note issued to BP in connection
with the CBCC Acquisition (the "BP Note"), which matured August 24, 1999, were
being offset against damages incurred by the Company (including environmental
investigation and remediation costs incurred by CBCC) as a result of, among
other things, the environmental condition of CBCC's site. To the extent CBCC
incurs future cleanup costs with respect to the investigatory and remedial
activities at its site, the Company intends to enforce its rights under the
CBCC Purchase Agreement and/or the Remediation Agreement to recover such
amounts from BP to the extent such costs exceed the amount recouped as a result
of prior offsets against the BP Note. The amounts the Company has claimed are
owed by BP to the Company are described in Part II., Item 1. Legal Proceedings.

         CBCC and/or other entities named "Chase Brass & Copper Co." (which may
include Old Chase or divisions of Old Chase) have been named by governmental
agencies and/or private parties as a potentially responsible party ("PRP")
under the Comprehensive Environmental Response, Compensation and Liability Act
of 1980 ("CERCLA") and/or state laws with respect to four sites (and possibly a
fifth site). The Company believes that CBCC has no liability for the cleanup
costs related to these sites because (a) such liability is attributable to an
entity that had the same or similar name to that of CBCC, such as a division or
a subsidiary of BP (other than the brass rod division of Old Chase), or (b)
such liability arose from acts that occurred prior to the CBCC Acquisition and,
therefore, BP retained such liability under the CBCC Purchase Agreement and is
contractually obligated to indemnify the Company for such liabilities. To the
extent CBCC incurs any cleanup costs with respect to these sites, it intends to
enforce its rights under the CBCC Purchase Agreement to recover such amounts
from BP.

         On January 7, 1998, a lawsuit entitled Ken-Chas Reserve Company and BP
Exploration (Alaska) Inc. and The Standard Oil Company v. Chase Industries Inc.
and Chase Brass & Copper Company, Inc. was filed in the Court of Common Pleas
in Cuyahoga County, Ohio. In this complaint (as amended, the "Complaint"),
plaintiffs seek declaratory judgment regarding the calculation of interest
payable under the $20 million BP Note. Under the BP Note, a contingent interest
payment was payable August 24, 1996, calculated pursuant to a formula based on
the Company's "EBDIT" (defined in the BP Note as earnings before depreciation,
interest and taxes, as


                                      10


<PAGE>   11


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

determined in accordance with GAAP) for years 1990 through 1995. In calculating
the interest payable on August 24, 1996, the Company followed the express terms
of the BP Note and, accordingly, deducted amortization from earnings for the
purposes of the interest calculation. In calculating the interest payable on
August 24, 1996, in accordance with the express terms of the BP Note, the
interest payable was $254,746, which the Company offset against the receivable
from BP. Plaintiffs allege that, notwithstanding the express terms of the BP
Note, the term "EBDIT" should be interpreted to refer to earnings before
depreciation, interest, taxes and amortization and, based on such
interpretation, allege that the contingent interest payable under the BP Note
in August 1996 should have been approximately $5.8 million.

         In addition, under the BP Note interest was payable on August 24 of
each year from and after August 24, 1996, until the BP Note matured on August
24, 1999. The interest due and payable on each of August 24, 1998 and 1997, was
$1,856,000, which amount the Company also offset against the receivable from
BP. As of the August 24, 1999, due date of the BP Note, the Company also offset
accrued and unpaid interest of $1,856,000 due August 24, 1999, and the full
principal balance of the BP Note against the receivable from BP and other
amounts claimed by the Company to be owed by BP to the Company as a result of
BP's breaches of the CBCC Purchase Agreement and the Remediation Agreement. In
the Complaint, plaintiffs also seek recovery of the $20 million principal
amount of the BP Note plus interest allegedly owing on the BP Note.

         The Company disputes the allegations set forth in the Complaint and
has asserted a counterclaim seeking recovery from BP of damages resulting from
BP's breach of representations, warranties and covenants contained in the CBCC
Purchase Agreement and amounts owed under the Remediation Agreement. The
counterclaim also seeks to enforce a prior settlement agreement between the
Company and BP regarding certain disputes under the CBCC Purchase Agreement and
the Remediation Agreement and seeks a declaratory judgment confirming the
Company's entitlement to offset and/or recoup amounts owed by BP and Old Chase
against amounts payable under the BP Note and that no default has occurred
under the BP Note.

         Although the Company disputes the plaintiffs' allegations, the Company
believes that, even if plaintiffs were to prevail in their positions as set
forth in the Complaint, the Company would be able to pay amounts due, including
the principal amount of the BP Note, utilizing cash on hand, offsets of amounts
owing from Old Chase and BP, and, if necessary, borrowings available under the
Company's existing Bank Credit Facility.

         This case currently is scheduled for trial in September 2000.

         Notwithstanding that the Company has offset amounts payable under the
BP Note as described above, for financial statement reporting purposes,
pursuant to Statement of Financial Accounting Standards No. 125, "Accounting
for Transfers and Servicing of Financial Assets and Extinguishment of
Liabilities" ("SFAS 125"), the Company continues to record the full principal
balance of the BP Note as a liability. SFAS 125 requires that, in order to
extinguish a liability, the debtor must be legally released from the obligation
by either the creditor or judicially. As the BP Note is subject to
determination in litigation, the Company has maintained the debt on its books
and


                                      11

<PAGE>   12


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

continues to accrue interest at 9.28%. The Company continues to classify
the BP Note as long-term because, if necessary, it has the ability to repay the
amount on a long-term basis with borrowings available under the Bank Credit
Facility.

         Leavitt. Prior to the Leavitt Acquisition, five underground storage
tanks ("USTs") were removed from Leavitt's property in Hammond, Indiana. Prior
to removal, one or more of the USTs released petroleum and other chemical
constituents into the environment. Some contamination of groundwater and soil
at the Hammond property remains in place. The Indiana Department of
Environmental Management ("IDEM") has not yet issued a "closure" letter with
respect to the removal of these USTs, and in fourth quarter 1999 notified
Leavitt that additional groundwater sampling will be required prior to the IDEM
considering closure. Leavitt conducted additional groundwater sampling in first
quarter 2000 and has submitted the results of the sampling to the IDEM for
review and further direction.

         Until these actions are carried out, the Company will be unable to
determine what, if any, remedial activities may be required at the Hammond
property. Although the cleanup costs associated with the environmental
conditions at the Hammond property may be material, based on the results of
sampling conducted in 1997 and first quarter 2000 the Company believes that the
probability that Leavitt would be required to make material expenditures
relating to site cleanup at the Hammond property appears to be remote.
Therefore, the Company has not made any specific accrual for costs related to
investigation or cleanup at the Hammond property. The Hammond operations were
relocated to Chicago in September 1997, and no manufacturing activities
currently are conducted at the Hammond location.

5.       BUSINESS SEGMENTS:

         The Company has two business segments. One, brass products, is engaged
in the manufacture and sale of free-machining and forging brass rod; the
second, steel products, manufactures and sells structural and mechanical steel
tubing and structural pipe.

         The brass products segment, employing more than 300 people at its
Montpelier, Ohio plant, is an ISO 9002 certified manufacturer and supplier of
free-machining and forging brass rod in the United States and Canada. Its
diverse customer base of more than 250 companies uses the "Blue Dot" trademark
rod to produce a variety of products, such as plumbing fixtures, heating and
air conditioning components, industrial valves, automotive parts and numerous
hardware components.

         The steel products segment is a leading producer of structural and
mechanical steel tubing and structural pipe, employing approximately 340 people
at its two plants in Chicago, Illinois, and one plant in Jackson, Mississippi.
Structural steel tubing is used in non-residential construction, farm equipment
and other commercial applications. The mechanical steel tubing is used in a
broad range of consumer and commercial products, including furniture and
fixtures, lawn-care products, storage racks, exercise equipment, bicycles and
machine tools. Structural pipe is used for handrails, scaffolding and
communications towers.


                                      12

<PAGE>   13


                              CHASE INDUSTRIES INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

         Income and expenses not allocated to business segments include certain
corporate expenses, interest expense and interest income. There are no
intersegment sales. The business segment information is prepared consistent
with the accounting policies outlined in Note 1, Significant Accounting
Policies, except for income taxes which are recorded at the corporate level.
Summarized segment information is as follows (in thousands):

<TABLE>
<CAPTION>
                                                                   Three Months Ended June 30,
                                                                 ------------------------------
                                                                     2000              1999
                                                                 ------------      ------------
<S>                                                              <C>               <C>
Net sales:
  Brass products                                                 $     72,526      $     65,700
  Steel products                                                       29,098            31,877
                                                                 ------------      ------------
     Total net sales                                             $    101,624      $     97,577
                                                                 ============      ============

Operating income:
  Brass products                                                 $      9,103      $      8,057
  Steel products                                                         (686)              819
  Corporate                                                              --                (405)
                                                                 ------------      ------------
     Total operating income                                      $      8,417      $      8,471
                                                                 ============      ============

Selected non-cash charges included in operating income
Lower of cost-or-market inventory writedown:
  Brass products                                                 $       --        $       --
  Steel products                                                         --                --
                                                                 ------------      ------------

     Total lower of cost-or-market inventory writedown           $       --        $       --
                                                                 ============      ============

<CAPTION>

                                                                    Six Months Ended June 30,
                                                                 ------------------------------
                                                                     2000              1999
                                                                 ------------      ------------
<S>                                                              <C>               <C>
Net sales:
  Brass products                                                 $    152,806      $    137,262
  Steel products                                                       63,411            64,183
                                                                 ------------      ------------
     Total net sales                                             $    216,217      $    201,445
                                                                 ============      ============

Operating income:
  Brass products                                                 $     18,904      $     17,176
  Steel products                                                         (899)             (503)
  Corporate                                                               (65)             (570)
                                                                 ------------      ------------
     Total operating income                                      $     17,940      $     16,103
                                                                 ============      ============

Selected non-cash charges included in operating income
Lower of cost-or-market inventory writedown:
  Brass products                                                 $       --        $       --
  Steel products                                                         --               1,800
                                                                 ------------      ------------
     Total lower of cost-or-market inventory writedown           $       --        $      1,800
                                                                 ============      ============
</TABLE>


                                      13

<PAGE>   14
                             CHASE INDUSTRIES INC.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

GENERAL

Operations

         The Company has two business segments, the brass products segment
operated by CBCC and the steel products segment operated by Leavitt. The
Company is a leading manufacturer of free-machining and forging brass rod and
structural and mechanical steel tubing and structural pipe.

         CBCC. CBCC is an ISO 9002 certified manufacturer and supplier of
free-machining and forging brass rod in the United States and Canada. CBCC's
net sales represent gross sales of brass rod less sales discounts and freight
charges. The gross sales price of brass rod consists of a metal price charged
to customers and a fabrication price as separate components. Cost of goods sold
includes the cost of brass scrap, which is the principal raw material used in
the manufacturing process and the primary component of cost of goods sold, as
well as the costs of labor, energy and other materials and supplies used in
fabricating the brass scrap into finished rod. Therefore, CBCC's profit levels
depend primarily on the amount of finished rod shipped, fabrication prices and
the difference between the metal price charged to customers and CBCC's cost of
brass scrap.

         CBCC obtains approximately 70% of the brass scrap used in its
operations from its customers through purchase and tolling arrangements. The
metal price charged to customers (the "Metal Selling Price") had been four
cents per pound higher than the price at which brass scrap is purchased from
customers (the "Metal Buying Price") since December 1994. In December 1997, the
difference was increased to five cents per pound, and in January 1999 the
difference was increased to seven cents per pound. The difference between the
Metal Selling Price and the Metal Buying Price was increased to eight cents per
pound in September 1999. CBCC also purchases approximately 30% of its brass
scrap from scrap dealers at prevailing free-market prices. Free-market prices
of brass scrap fluctuate based on the supply of and demand for brass scrap and
the prices for copper and zinc (the major components of brass), and generally
are less than the Metal Buying Price. Since 1990, free-market prices, as
compared to Metal Buying Prices, have been favorable to CBCC by historical
standards and the supply of brass scrap in the United States has increased in
excess of demand as a result of increased imports of brass rod. Although the
increased supply of brass scrap has resulted in continued favorable free-market
scrap prices through June 2000, there can be no assurance that such discounts
will continue. Decreasing imports of brass rod and increasing demand for brass
scrap could cause free-market brass scrap prices to increase, and increased
pressure from customers to purchase brass scrap directly from them at the Metal
Buying Price could reduce CBCC's ability to take advantage of free-market
discounts.


                                      14

<PAGE>   15


                             CHASE INDUSTRIES INC.

         As noted above, CBCC's pricing structure consists of the Metal Selling
Price and the fabrication price as separate components. The Metal Selling Price
is determined at the time of shipment based on the then-current Metal Buying
Price and is not directly affected by fluctuations in free-market brass scrap
prices. As a result of this pricing structure, increases and decreases in the
Metal Selling Price will affect net sales levels and gross profit as a
percentage of sales, even in the absence of an increase or decrease in
shipments or the fabrication prices charged to customers, but will have little
impact on gross profit levels. However, the quantity of free-market brass scrap
purchased by CBCC and changes in the difference between the free-market prices
paid for brass scrap and the Metal Buying Price will affect gross profit, even
in the absence of an increase or a decrease in shipments or net sales levels.

         In addition to sales made under the pricing structure described above,
some sales are made on a tolling basis, where the customer consigns brass scrap
to CBCC and is charged a fabrication price for processing the brass scrap into
finished rod. Tolling transactions affect net sales by the Metal Selling Price
that otherwise would be charged to the customer in a sale of finished brass
rod. To a lesser degree, tolling transactions also affect gross profit to the
extent CBCC is unable to take advantage of the pricing differential on brass
scrap purchased and sold. To partially offset the effect of tolling
transactions on gross profit, CBCC requires tolling customers to deliver
additional pounds of brass scrap in exchange for each pound of finished rod
shipped.

         Leavitt. Leavitt is a leading producer of structural and mechanical
electric resistance welded steel tubing in square, rectangular and round shapes
in sizes ranging from 1/2 inch to 10 inch squares and equivalent rectangles and
3/8 inch to 12 3/4 inches in outer diameter for round sizes. Leavitt's
financial performance may be impacted by changes in the price it pays for
flat-rolled steel, the primary cost component of Leavitt's finished product,
based on the market conditions in the domestic and the international
flat-rolled steel industry. Based on the then-current market conditions in the
steel tubing industry and the level of capacity utilization, Leavitt may or may
not be able to pass the economic impact of steel price changes on to its
customers through changes in the selling price. The steel tubing industry is
highly fragmented and suppliers may reduce prices or fail to increase prices as
a result of flat-rolled steel price increases, depending on their individual
financial and operational motivation.

RESULTS OF OPERATIONS

Three Months Ended June 30, 2000, Compared with Three Months Ended June 30, 1999

         Net sales increased $4.0 million, or 4.1%, to $101.6 million in second
quarter 2000 from $97.6 million in second quarter 1999. Net sales increased
mainly as a result of a 10% increase in the brass rod Metal Selling Price.
Also, net sales increased due to higher brass rod shipments. Partially
offsetting the increase in brass rod sales was a 19% reduction in Leavitt's
shipments and lower unit margins resulting from higher steel costs.

         Gross profit decreased $0.6 million, or 3.8%, from $15.8 million in
second quarter 1999 to $15.2 million in second quarter 2000.



                                      15

<PAGE>   16

                             CHASE INDUSTRIES INC.

         Selling, general and administrative ("SG&A") expenses decreased $0.9
million, or 20.5%, to $3.5 million in second quarter 2000 from $4.4 million in
second quarter 1999. The decrease primarily was due to reduced professional and
consulting expenses.

         Depreciation and amortization increased $0.3 million, or 10.3%, to
$3.2 million in second quarter 2000 from $2.9 million in second quarter 1999.
The increase was primarily the result of increased depreciation primarily from
the new brass foundry.

         As a result of the above factors, operating income of $8.4 million in
second quarter 2000 was flat with second quarter 1999. CBCC's operating income
for second quarter 2000 increased $1.0 million as compared with second quarter
1999, primarily due to the new brass foundry lowering metal costs and lower
SG&A expenses. Leavitt's operating income for second quarter 2000 decreased
$1.5 million as compared with second quarter 1999, primarily due to lower
shipments and lower unit margins resulting from higher steel costs.

         Net interest expense increased $0.2 million to $0.5 million in second
quarter 2000 from $0.3 million in second quarter 1999, primarily as a result of
lower capitalized interest expense due to the completion of the new brass
foundry.

         Income tax expense decreased $0.1 million, or 3.2%, to $3.0 million in
second quarter 2000 as a result of a decrease of $0.2 million, or 2.4%, in
income before income taxes. The effective tax rates for 2000 and 1999 were 38%.

         As a result of the above factors, net income decreased $0.2 million,
or 3.9%, to $4.9 million in second quarter 2000 from $5.1 million in second
quarter 1999. Diluted earnings per share decreased to $0.32 in second quarter
2000 from $0.33 in second quarter 1999.

Six Months Ended June 30, 2000, Compared with Six Months Ended June 30, 1999

         Net sales increased $14.8 million, or 7.3%, to $216.2 million in 2000.
Net sales increased mainly as a result of an 11% increase in the brass rod
Metal Selling Price. Also, net sales increased due to higher brass rod
shipments. Net sales at Leavitt were flat as a result of increased tube prices
being offset by lower shipments.

         There were no inventory writedowns recorded in 2000. The Company
recorded a non-cash lower of cost-or-market inventory writedown of $1.8 million
for the six months ended June 30, 1999. The 1999 writedown was due to the
decreasing prices of flat-rolled steel and steel tubing.

         Gross profit for the six months ended June 30, 2000, excluding the
lower of cost-or-market inventory writedown, decreased $1.0 million, or 3.1%,
to $31.3 million from 1999. Gross profit was adversely effected by competitive
steel tubing price pressures, which have reduced steel tubing margins.

         SG&A expenses decreased $1.6 million, or 18.4%, to $7.1 million for
the six months ended June 30, 2000. The decrease was partly due to reduced
professional and consulting costs.


                                      16

<PAGE>   17

                             CHASE INDUSTRIES INC.

         Depreciation and amortization increased $0.5 million, or 8.8%, to $6.2
million due to the new brass foundry.

         As a result of the above factors, operating income, excluding the
lower of cost-or-market inventory writedown, for the six months ended June 30,
2000, was flat, compared with 1999.

         Net interest expense for the six months ended June 30, 2000 was flat
as compared with 1999, primarily due to increased interest income in 2000 and
lower capitalized interest expense.

         Income tax expense for the six months ended June 30, 2000, increased
$0.7 million, or 12.1%, to $6.5 million as a result of an increase of $1.8
million, or 11.8%, in income before income taxes. In first quarter 2000, the
Internal Revenue Service (the "IRS") completed an examination of the federal
income tax return filed by the Company for the year ended December 31, 1996. In
July 2000, the Company received a refund in the amount of $1.1 million from the
IRS resulting from the treatment of settled issues for that year. Management
believes adequate provisions for income tax have been recorded for all years.

         As a result of the above factors, net income increased $1.1 million,
or 11.6%, to $10.6 million in 2000 from $9.5 million in 1999. Diluted earnings
per share increased to $0.69 in 2000 from $0.62 in 1999.

LIQUIDITY AND CAPITAL RESOURCES

General

         At June 30, 2000, cash and cash equivalents totaled $1.8 million
decreasing from $9.1 million at year end 1999. Total debt at June 30, 2000, was
$22.3 million compared with $27.3 million at year end 1999.

Working Capital

         At June 30, 2000, working capital was $48.0 million, a $5.8 million,
or 13.7%, increase from $42.2 million at December 31, 1999. A decrease in cash
and cash equivalents of $7.3 million, or 80.2%, was offset by increases in
accounts receivable of $5.6 million, or 16.8%, and inventory of $1.7 million,
or 3.8%, and a decrease in accounts payable of $5.1 million, or 16.1%.

         The increase in accounts receivable was due primarily to an increase
in net sales in second quarter 2000 compared to fourth quarter 1999. The
Company's shipments are typically lower in December due to customer shutdowns.
The decrease in accounts payable was the result of the timing of metal
purchases, payment of accrued environmental costs and the completion of the new
brass foundry project.

         The Company's current ratio was 2.08 at June 30, 2000, compared to
1.79 at December 31, 1999.



                                      17

<PAGE>   18

                             CHASE INDUSTRIES INC.

Cash Flow Provided by Operating Activities

         For the six months ended June 30, 2000, net cash provided by operating
activities was $6.6 million, which included net income of $10.6 million and
depreciation and amortization of $6.2 million. There was an increase in working
capital, excluding cash, debt and deferred taxes, of $13.2 million from
December 31, 1999.

         For the six months ended June 30, 1999, net cash provided by operating
activities was $20.4 million, which included net income of $9.5 million and
depreciation and amortization of $5.7 million. There was a decrease in working
capital, excluding cash, debt and deferred taxes, of $8.5 million.

Cash Flow (Used in) Investing Activities

         Capital expenditures were $9.2 million for the six months ended June
30, 2000, and $11.9 million for the six months ended June 30, 1999. Capital
expenditures in 2000 and 1999 primarily related to construction and equipment
costs for the new CBCC foundry discussed below. Capital expenditures in 2000
also included $4.0 million in capital equipment costs for Phase III of Project
400, discussed below.

Cash Flow (Used in) Financing Activities

         Cash used in financing activities of $4.8 million for the six months
ended June 30, 2000, consisted primarily of the repayment of the Term Loan
($7.0 million) and borrowings under the Revolving Credit Facility, as defined
below. The Term Loan was paid off in June, 2000, three years ahead of schedule.

         Cash used in financing activities of $0.1 million for the six months
ended June 30, 1999, consisted primarily of principal payments on long-term
debt.

Capital Resources

         In 1996, CBCC launched a capital project referred to as "Project 400."
The project is designed to increase foundry, extrusion and finishing
capabilities with an ultimate goal of increasing finished brass rod production
capability by one-third to approximately 400 million pounds annually. The first
phase of the project was completed in early 1998 with the installation of three
new billet heaters that increased finished brass rod capacity by about 17
percent. The new billet heaters have increased productivity and improved
quality. The total cost of the first phase of the project was approximately $12
million and was financed through a six-year operating lease.

         In second quarter 1998, the Company announced Phase II of Project 400,
which was a $30 million multi-year investment to construct an additional brass
foundry enabling CBCC to increase casting capacity and to provide customers
with multiple alloys. New casting equipment has been installed and a new
building is completed. The new brass foundry began producing billets on a trial
basis in February 2000 and is now producing billets at expected production
rates. The new foundry has reduced costs and increased production capacity and
shipments.


                                      18

<PAGE>   19

                             CHASE INDUSTRIES INC.

         In fourth quarter 1999, Phase III of Project 400, with an estimated
cost of $50 million, was approved by the Company's Board of Directors. Phase
III building construction began during second quarter 2000. Contracts were
signed for the long-lead-time equipment, including new finishing equipment,
billet heaters and the extrusion press. A second extrusion press and additional
finishing equipment will be installed over the next two years. When Phase III
comes on line, which is expected to occur in 2002, CBCC's production capacity
will exceed 400 million pounds annually. The Company anticipates that capital
projects will be paid for with cash flows provided by operating activities and
the Bank Credit Facility, as necessary.

Bank Credit Facility

         In connection with the Leavitt Acquisition, the Company entered into a
credit facility (the "Bank Credit Facility") of $100 million agented by PNC
Bank, National Association ("PNC Bank"). The Bank Credit Facility originally
included a $60 million term loan ("Term Loan") and a $40 million revolving
credit facility ("Revolving Credit Facility"). Prior to second quarter 2000,
the Company had prepaid all amounts on the Term Loan originally due through
April 2001. The remaining balance of $7 million on the Term Loan was prepaid in
second quarter 2000. Effective September 8, 1999, the Company and PNC Bank
agreed on an amendment to the Bank Credit Facility which increased the
Revolving Credit Facility by $10 million, to $50 million. The Revolving Credit
Facility commitment currently expires August 30, 2001, and the Company can
request a one-year extension of the expiration date at any time, subject to
approval by the lenders.

         Advances under the Bank Credit Facility bear interest at alternative
variable rates based on certain percentages, as provided in the agreement, in
excess of the lending bank's prime rate, the Federal funds rate or LIBOR, with
interest payable quarterly or as of the end of each LIBOR borrowing period,
whichever is shorter. The weighted average interest rate on the Bank Credit
Facility was 6.5% at December 31, 1999.

         The Bank Credit Facility contains certain covenants that, among other
things, limit the Company's ability to incur additional debt or pay dividends.
The covenants also require the Company to maintain a minimum interest coverage
ratio and level of net worth and restrict the Company from exceeding a maximum
ratio of debt to cash flow from operations. The Bank Credit Facility also
requires the Company to maintain CBCC and Leavitt as wholly-owned subsidiaries.

         As of June 30, 2000, $2.0 million was outstanding under the Revolving
Credit Facility. Total availability under the Revolving Credit Facility was
$46.6 million as of June 30, 2000.

BP Note

         In connection with the CBCC Acquisition, the Company issued a
promissory note to Old Chase in the original principal amount of $20 million
(the "BP Note"). The BP Note initially matured in August 1996, and the Company,
at its option, extended the maturity date for three additional years to August
1999 with interest payable annually at 9.28%. The BP Note contained a
contingent interest payment based upon average Company earnings (defined in the
BP Note) for the years ended December 31, 1990 through 1995. The contingent
interest, totaling $254,000 and


                                      19

<PAGE>   20

                             CHASE INDUSTRIES INC.

due August 1996, and the annual interest of $1,856,000 due August 1997 and
1998, were offset against the receivable from BP. As of the August 24, 1999,
due date of the BP Note, the Company also offset the $1,856,000 in accrued and
unpaid interest due August 24, 1999, and the full principal balance of the BP
Note against the receivable from BP and other amounts claimed by the Company to
be owed by BP to the Company as a result of BP's breach of the CBCC Purchase
Agreement and the Remediation Agreement. However, for financial statement
reporting purposes, pursuant to Statement of Financial Accounting Standards No.
125, "Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities" ("SFAS 125"), the Company continues to record
the full principal balance of the BP Note as a liability. SFAS 125 requires
that in order to extinguish a liability, the debtor must be legally released
from the obligation by either the creditor or judicially. As the BP Note is
subject to determination in litigation described below, the Company has
maintained the debt on its books and continues to accrue interest at 9.28%. The
Company continues to classify the BP Note as long-term because, if necessary,
it has the ability to repay the amount on a long-term basis with borrowings
obtained under the Bank Credit Facility.

CONTINGENCIES - ENVIRONMENTAL MATTERS

         As discussed in Note 4 of Notes to Consolidated Financial Statements
included in Item 1., each of CBCC and Leavitt are subject to certain contingent
liabilities relating to environmental conditions at their respective
facilities.

         CBCC. CBCC initiated interim remedial actions for certain portions of
its Montpelier, Ohio site in second quarter 1999. Sampling conducted as part of
these interim remedial actions identified the presence of VOCs that were not
covered by the initial scope of these interim actions. As a result, CBCC
conducted additional sampling of those areas of the site to further delineate
the contamination in those areas. Based on the aggregate sampling results, CBCC
modified its 1999 remediation plan. CBCC began implementing the modified plan
in first quarter 2000. As of June 30, 2000, the estimated remaining costs for
these remediation activities, which CBCC expects to complete in fourth quarter
2000, range from approximately $2.8 million to $5.8 million depending on the
use of certain of remediation methodologies, quantities of material generated
and disposal options that may be permitted and/or available. CBCC also is in
the process of developing a remediation plan for two additional areas of its
site, and expects to initiate remediation activities at those areas in 2001 at
an estimated cost ranging from approximately $1.7 million to $3.9 million.

         Based on currently available data, the Company believes that, upon
completion of the remediation activities described above, CBCC will have
substantially completed the remediation activities at its site that are
necessary to address contamination of which CBCC currently is aware. However,
until completion of these remedial and associated investigatory activities and
receipt of approval from the Ohio EPA of CBCC's activities to remediate this
contamination, the Company cannot be certain that further remediation
activities will not be required at CBCC's site.



                                      20

<PAGE>   21

                             CHASE INDUSTRIES INC.

         Although BP has acknowledged its contractual obligation to fund
certain investigatory and cleanup activities related to site contamination
attributable to Old Chase's operations, as described below under "Contingencies
- Legal Proceedings" BP and CBCC currently are involved in litigation
regarding, among other things, the extent of BP's obligations under the
Remediation Agreement and CBCC Purchase Agreement. BP has not yet reimbursed
CBCC for costs incurred by CBCC for prior remediation activities conducted by
CBCC. To the extent BP fails to fund current and future remediation activities
at CBCC's manufacturing facility, CBCC will be required to fund these
activities. However, to the extent CBCC is required to fund cleanup costs
related to the remediation of contamination at its manufacturing facility, the
Company believes it would be able to fund these costs with cash on hand and
borrowings under its existing Bank Credit Facility. Therefore, the Company does
not believe that funding these remediation activities will have a material
adverse effect on the Company's financial condition, results of operations or
liquidity.

         The Company notified BP in third quarter 1999 that amounts payable by
the Company under the BP Note were being offset against damages incurred by the
Company, including environmental investigation and remediation costs, as a
result of BP's breaches of the CBCC Purchase Agreement and the Remediation
Agreement. To the extent CBCC incurs future cleanup costs with respect to
investigatory and remedial activities at its site, it intends to enforce its
rights under the CBCC Purchase Agreement and/or Remediation Agreement to
recover such amounts from BP to the extent such costs exceed the amount
recouped as a result of the prior offsets against the BP Note.

         Leavitt. Pending further direction from the IDEM, the Company
currently is unable to determine what, if any, remedial activities may be
required at Leavitt's Hammond property. Although the cleanup costs associated
with the environmental conditions at the Hammond property may be material,
based on the results of sampling conducted to date the Company believes that
the probability that Leavitt would be required to make material expenditures
relating to site cleanup at the Hammond property appears to be remote.
Therefore, the Company has not made any specific accrual for costs related to
investigation or cleanup at the Hammond property. To the extent the Company or
Leavitt incurs a liability with respect to site cleanup at the Hammond
property, ROHN Industries, Inc. (formerly UNR Industries, Inc.), is
contractually obligated to indemnify Leavitt for 90% of losses related to
certain environmental conditions, including costs incurred with respect to
contaminants released at Leavitt's properties (including the Hammond property)
prior to the Leavitt Acquisition, to the extent such losses exceed $400,000 in
the aggregate (approximately $150,000 have been incurred for various matters).
In addition, to the extent the contamination at the Hammond property is
attributed to actions of prior owners, the Company may be entitled to recover
from prior owners costs incurred by the Company at the Hammond site. The
Hammond operations were relocated to Chicago in September 1997, and no
manufacturing activities currently are conducted at the Hammond location.

         The statements set forth herein regarding anticipated expenditures for
environmental matters are forward looking, are based on sampling results
currently available to the Company, remediation plans developed and in the
process of being developed by independent consultants of CBCC (which plans are
based on certain assumptions regarding applicable cleanup standards and
methodologies, cost estimates for completion of the remediation activities
initiated in 1999 and preliminary cost estimates for completion of remediation
at other areas of CBCC's site). Actual costs required to be expended by the
Company with respect to such matters may differ materially from current


                                      21

<PAGE>   22

                             CHASE INDUSTRIES INC.

expectations depending on the final resolution of known uncertainties,
including finalization of remediation plans for the two remaining areas of
CBCC's site at which remediation currently is contemplated, completion of
currently ongoing and proposed remediation activities, acceptance by applicable
governmental agencies of cleanup standards relied upon in developing
remediation plans and cost estimates, discovery of additional contaminants
during remediation, any change in CBCC's proposed use of its property which
affects any applicable cleanup standard and, with respect to Leavitt, the
results of any additional sampling that may be necessary or required at the
Hammond, Indiana, property and any remediation activities as may be required by
the IDEM at such site.

CONTINGENCIES - LEGAL PROCEEDINGS

         As discussed in Note 4 of Notes To Consolidated Financial Statements
included in Part I., Item 1 and in Part II, Item 1. Legal Proceedings, the
Company and CBCC are defendants in a lawsuit regarding amounts payable under
the BP Note. As discussed therein, the Company disputes the allegations made in
the lawsuit, but believes that, even if the plaintiffs were to prevail in their
positions, the Company would be able to pay amounts due, including the
principal amount of the BP Note, utilizing cash on hand, offsets of amounts
owing from Old Chase and BP, and, if necessary, borrowings available under the
Company's existing Bank Credit Facility. Therefore, the Company continues to
classify the BP Note as long-term, and believes that judgment adverse to the
Company and CBCC would not have a material adverse effect on the Company's
financial condition, results of operations or liquidity. See "BP Note" above.

SAFE HARBOR

         This document contains forward-looking statements regarding the
operations of the Company and the industries in which it operates. These
statements are identified by the use of words such as "believe," "expects,"
"anticipates," "will," "should" and other words referring to events to occur in
the future. Management uses estimates and assumptions in forming the basis for
such forward-looking statements. Such estimates and assumptions, including
forecasts regarding demand and pricing for the Company's products, are subject
to risks and uncertainties which could cause actual results to differ
materially from historical results or those anticipated, as described in
forward-looking statements. Actual results will be affected by general economic
and industry conditions in the end-use markets for the Company's products as
well as the impact of competitive products and pricing, including without
limitation the impact of imports. Foreign economic activity and the
relationship of the U. S. dollar to other currencies also affect import levels
and exports of U.S. manufactured products containing parts made from brass rod
and steel tube. The Company's shipments also will be affected by its ability to
maintain manufacturing operations at its current levels without significant
interruption and successfully implement its capacity expansion program.



                                      22

<PAGE>   23

                             CHASE INDUSTRIES INC.

                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         The Company is involved in certain claims and litigation as described
in Note 4 of Notes to Consolidated Financial Statements included in Part I.,
Item 1, of this report and in Part I, Item 3. Legal Proceedings contained in the
Company's Annual Report on Form 10-K for the year ended December 31, 1999, and
Part II, Item 1 Legal Proceedings contained in the Company's Quarterly Report on
Form 10-Q for the period ended March 31, 2000.

         In March 2000, in the lawsuit styled Ken-Chas Reserve Company and BP
Exploration (Alaska) Inc. and The Standard Oil Company v. Chase Industries Inc.
and Chase Brass & Copper Company, Inc., the Company filed two motions for
partial summary judgment against BP. The first motion for partial summary
judgment filed by the Company seeks a declaration that BP has breached both the
Asset Purchase Agreement and the Remediation Agreement based upon the
environmental condition of the property and BP's failure to comply with its
guarantee of compliance with an environmental permit, as well as BP's failure
to indemnify the Company for its resulting damages. The second motion for
partial summary judgment filed by the Company seeks a declaration that the
Company properly deducted amortization in determining "EBDIT" in the contingent
interest calculation under the BP Note. In May 2000 BP filed a response to each
of the Company's motions requesting the court to deny the motions. In June 2000
the Company filed a reply to each of BP's responses. These motions currently
are pending before the court.

         Additional information regarding this lawsuit is included in Note 4 of
Notes to Consolidated Financial Statements included in Part I., Item 1. of this
report.



                                      23

<PAGE>   24

                             CHASE INDUSTRIES INC.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         The Annual Meeting of Stockholders of the Company was held on May 31,
2000, for the purpose of electing a board of directors, ratifying the
appointment of independent accountants and transacting such other business as
properly came before the meeting. Proxies for the meeting were solicited
pursuant to Regulation 14A of the Securities Exchange Act of 1934 and there was
no solicitation in opposition to management's solicitations.

         The only matters acted upon at the meeting were the election of
directors and the ratification of the Company's independent accountants. All
nominees for directors as listed in the Proxy Statement dated April 10, 2000,
were elected with the following vote:

<TABLE>
<CAPTION>
                                        Shares Voted "For"          Shares "Withheld"           Broker Non-Votes
                                        ------------------          -----------------           ----------------
<S>                                     <C>                         <C>                         <C>
Martin V. Alonzo                            8,118,876                      64,620                     -0-
Raymond E. Cartledge                        8,118,876                      64,620                     -0-
Charles E. Corpening                        7,957,281                     226,215                     -0-
John R. Kennedy                             7,986,226                     197,270                     -0-
Robert D. Kennedy                           8,106,181                      77,315                     -0-
Thomas F. McWilliams                        8,115,276                      68,220                     -0-
William R. Toller                           8,117,926                      65,570                     -0-
</TABLE>

         The appointment of PricewaterhouseCoopers LLP as independent
accountants was ratified by the following vote:

<TABLE>
<CAPTION>
     Share Voted "For"            Shares Voted "Against"           Shares Abstaining            Broker Non-Votes
     -----------------            ----------------------           -----------------            ----------------
<S>                               <C>                              <C>                          <C>
         8,158,095                        19,849                         5,552                        -0-
</TABLE>



                                       24

<PAGE>   25

                             CHASE INDUSTRIES INC.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      EXHIBITS

<TABLE>
<S>              <C>      <C>
         3.1      -        Restated Certificate of Incorporation of the Company
                           (incorporated by reference to Exhibit 3.1 to the
                           Company's Quarterly Report on Form 10-Q for the
                           quarter ended June 30, 1998), as amended by the
                           Certificate of First Amendment to the Company's
                           Restated Certificate of Incorporation (incorporated
                           by reference to Exhibit 3.2 to the Company's Current
                           Report on Form 8-K dated May 14, 1997) and
                           Certificate of Second Amendment to the Company's
                           Restated Certificate of Incorporation, (incorporated
                           by reference to Exhibit 3.2 to the Company's Current
                           Report on Form 8-K dated May 26, 1998).

         3.2      -        By-Laws of the Company (incorporated by reference to
                           Exhibit 3.2 to the Company's Registration Statement
                           on Form S-1 as filed with the Securities and
                           Exchange Commission on November 3, 1994,
                           Registration No. 33-83178).

         4.1      -        Specimen Common Stock Certificate (incorporated by
                           reference to Exhibit 4.1 to the Company's
                           Registration Statement on Form S-1 as filed with the
                           Securities and Exchange Commission on November 3,
                           1994, Registration No. 33-83178).

         4.2      -        Exchange Agreement dated November 4, 1994, between
                           the Company and Citicorp Venture Capital Ltd.
                           ("CVC") (incorporated by reference to Exhibit 4.4 to
                           the Company's Registration Statement on Form S-8
                           dated December 9, 1994, Registration No. 33-87278).

         4.3      -        Voting Agreement dated November 4, 1994, between the
                           Company, CVC and Martin V. Alonzo ("Mr. Alonzo")
                           (incorporated by reference to Exhibit 4.5 to the
                           Company's Registration Statement on Form S-8 dated
                           December 9, 1994, Registration No. 33-87278).

         +27      -        Financial Data Schedule (EDGAR filing only).
</TABLE>


----------
+ Filed herewith


                                      25

<PAGE>   26

                             CHASE INDUSTRIES INC.

(b)      REPORTS ON FORM 8-K

         No Current Report on Form 8-K was filed by the Company during the
second quarter of 2000.






                                      26

<PAGE>   27



                             CHASE INDUSTRIES INC.



                                   SIGNATURE

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.


                                         CHASE INDUSTRIES INC.




Date:  August 14, 2000                   By:    /s/ MICHAEL T. SEGRAVES
                                                -----------------------
                                                Michael T. Segraves
                                                Vice President
                                                Chief Financial Officer
                                                (duly authorized officer and
                                                Principal Financial Officer)






                                      27

<PAGE>   28



                             CHASE INDUSTRIES INC.




                               INDEX TO EXHIBITS


<TABLE>
<CAPTION>
EXHIBIT                                                                                SEQUENTIALLY
NUMBER                             DESCRIPTION OF EXHIBITS                             NUMBERED PAGE
-------                            -----------------------                             -------------
<S>              <C>                                                                 <C>

3.1      -        Restated Certificate of Incorporation of the Company
                  (incorporated by reference to Exhibit 3.1 to the Company's
                  Quarterly Report on Form 10-Q for the quarter ended June 30,
                  1998), as amended by the Certificate of First Amendment to
                  the Company's Restated Certificate of Incorporation
                  (incorporated by reference to Exhibit 3.2 to the Company's
                  Current Report on Form 8-K dated May 14, 1997) and
                  Certificate of Second Amendment to the Company's Restated
                  Certificate of Incorporation, (incorporated by reference to
                  Exhibit 3.2 to the Company's Current Report on Form 8-K dated
                  May 26, 1998).

3.2      -        By-Laws of the Company (incorporated by reference to Exhibit
                  3.2 to the Company's Registration Statement on Form S-1 as
                  filed with the Securities and Exchange Commission on November
                  3, 1994, Registration No. 33-83178).

4.1      -        Specimen Common Stock Certificate (incorporated by reference
                  to Exhibit 4.1 to the Company's Registration Statement on
                  Form S-1 as filed with the Securities and Exchange Commission
                  on November 3, 1994, Registration No. 33-83178).

4.2      -        Exchange Agreement dated November 4, 1994, between the
                  Company and Citicorp Venture Capital Ltd. ("CVC")
                  (incorporated by reference to Exhibit 4.4 to the Company's
                  Registration Statement on Form S-8 dated December 9, 1994,
                  Registration No. 33-87278).

4.3      -        Voting Agreement dated November 4, 1994, between the Company,
                  CVC and Martin V. Alonzo ("Mr. Alonzo") (incorporated by
                  reference to Exhibit 4.5 to the Company's Registration
                  Statement on Form S-8 dated December 9, 1994, Registration
                  No. 33-87278).

+27      -        Financial Data Schedule (EDGAR filing only).
</TABLE>



----------
+  Filed herewith