Document:

<PAGE>   1
                                                                    EXHIBIT 10.4

                       THIRD AMENDMENT TO CREDIT AGREEMENT

         THIS THIRD AMENDMENT TO CREDIT AGREEMENT dated as of September 1, 2000
(the "Third Amendment") is made by and among CHASE INDUSTRIES INC. (formerly,
"Chase Brass Industries, Inc."), a Delaware corporation (the "Borrower"), the
Guarantors and the Banks referred to in the Credit Agreement (as defined below)
and PNC BANK, NATIONAL ASSOCIATION, a national banking association, as agent for
the Banks under the Credit Agreement (the "Agent").

                                   WITNESSETH:

         WHEREAS, the Borrower, the Guarantors, the Banks and the Agent are
parties to that certain Credit Agreement dated as of August 30, 1996, as amended
(as hereafter amended, the "Credit Agreement");

         WHEREAS, the parties to the Credit Agreement desire to amend the
provisions thereof as set forth herein;

         WHEREAS, capitalized terms used herein and not otherwise defined herein
and defined in the Credit Agreement shall have meanings assigned to them in the
Credit Agreement.

         NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:

1.       Amendments to Credit Agreement.

         A.       Extension of the Expiration Date.

                  The definition of "Expiration Date" contained in Section 1.1
is hereby amended and restated to read as follows:

                           "Expiration Date shall mean with respect to the
         Revolving Credit Commitments August 30, 2002 or such later date
         established with the consent of all of the Banks in accordance with the
         provisions of Section 2.7."

         B.       Leverage Ratio Level, Interest Rates.

                  (a)      Leverage Ratio Level.

                  The grid contained in the definition of "Leverage Ratio Level"
is amended as follows:

                           (i) the left column of the fifth row of such grid
(i.e. the row which corresponds to Level V) which currently reads: "greater than
or equal to 2.5 to 1.0 but less than 3.0 to 1.0" is hereby amended and restated
to read as follows: "greater than or equal to 2.5 to 1.0"

<PAGE>   2

                           (ii) the sixth row of such grid (i.e. the row which
corresponds to Level VI and the left column of which reads: "greater than or
equal to 3.0 to 1.0" is hereby deleted.

                  (b)      Commitment Fee. (Section 2.3)

                           The grid contained in Section 2.3 (Commitment Fee) is
hereby amended and restated to read as follows:

<TABLE>
<CAPTION>

              Leverage Ratio Level in Effect               Applicable Percentage
              ------------------------------               ---------------------
<S>                                                        <C>
                             I                                     .20%
                            II                                    .225%
                            III                                    .25%
                            IV                                    .275%
                             V                                    .325%
</TABLE>

                  (c)      Revolving Credit Euro-Rate Option.

                           The grid contained in Section 4.1(a)(ii) (Revolving
Credit Euro-Rate Option) is hereby amended and restated to read as follows:

<TABLE>
<CAPTION>

    Leverage Ratio Level in Effect           Revolving Credit Euro-Rate Spread
    ------------------------------           ---------------------------------
<S>                                          <C>
                I                                        .50%
               II                                        .75%
               III                                      1.00%
               IV                                       1.25%
                V                                       1.50%
</TABLE>

                  (d)      Revolving Credit Federal Funds Rate Option (Section
                           4.1(a)(iii))

                           The sixth row of the grid contained in Section
4.1(a)(iii) (Revolving Credit Federal Funds Rate Option) (i.e. the row which
corresponds to Level VI) is hereby deleted.

                                      -2-
<PAGE>   3

                  (e)      Effective Date of Interest Rate Changes.

                           It is acknowledged that the Leverage Ratio Level in
effect as of the date of this Third Amendment is "Level I." Effective on the
Effective Date of this Third Amendment, the Applicable Percentage shall be
increased from .15% to .2% and shall remain at .2% until such time as the
Applicable Percentage shall change pursuant to the last paragraph of the
definition of Leverage Ratio Level or otherwise pursuant to the terms of the
Credit Agreement. Effective on the Effective Date of this Third Amendment, the
Revolving Credit Euro-Rate Spread shall be increased from .375% to .5% and shall
remain at .5% until such time as such interest rate shall change pursuant to the
last paragraph of the definition of Leverage Ratio Level or otherwise pursuant
to the terms of the Credit Agreement.

                  (f)      Schedules To Credit Agreement.

                  The following schedules to the Credit Agreement are hereby
amended and restated in the forms attached hereto:

                  Schedule 1.1(B)   Commitments Of The Banks
                  Schedule 6.1(b)   Holders Of Voting Common Stock Of Borrower
                  Schedule 6.1(h)   Litigation
                  Schedule 6.1(m)   Patents, Trademarks, Copyrights And Licenses
                  Schedule 6.1(o)   Insurance Policies
                  Schedule 6.1(q)   Material Contracts
                  Schedule 6.1(u)   Employee Benefit Plan Disclosures
                  Schedule 6.1(v)   Collective Bargaining Agreements
                  Schedule 6.1(w)   Environmental Matters

2.       Representations and Warranties.

         The Borrower hereby represents and warrants to Banks that after giving
effect to this Third Amendment, the representations and warranties of Borrower
contained in the Credit Agreement are true and correct on and as of the date
hereof with the same force and effect as though made by Borrower on such date,
except to the extent that any such representation or warranty expressly relates
solely to a previous date. After giving effect to this Third Amendment, the
Borrower is in compliance with all terms, conditions, provisions, and covenants
contained in the Loan Agreement and the execution, delivery, and performance of
this Third Amendment have been duly authorized by all necessary corporate
action, require no governmental approval, and will neither contravene, conflict
with, nor result in the breach of any law, charter, articles, or certificate of
incorporation, bylaws, or agreement governing or binding upon Borrower or any of
its property; and, no Event of Default or Potential Default has occurred and is
continuing or would result from the making of this Third Amendment.

                                      -3-
<PAGE>   4

3.       Conditions of Effectiveness of Amendment.

         This Third Amendment shall be effective on the date (the "Effective
Date") on which each of the Borrower, the Guarantors, the Banks and the Agent
have executed this Third Amendment and all of the following conditions have been
satisfied:

         A.       Secretary's Certificate.

                  There shall be delivered to the Agent for the benefit of each
Bank a certificate dated the Effective Date of this Third Amendment and signed
by the Secretary or an Assistant Secretary of each of the Loan Parties,
certifying as appropriate as to:

                  (i) all action taken by each Loan Party in connection with
this Third Amendment and; and

                  (ii) the names of the officer or officers authorized to sign
this Third Amendment and the true signatures of such officer or officers.

         B.       Opinion of Counsel.

                  There shall be delivered to the Agents for the benefit of each
Bank written opinion of counsel for the Borrower and its Subsidiaries dated as
of the Effective Date of this Third Amendment and in form and substance
satisfactory to the Agents and their counsel as to the matters set forth in
Exhibit 3(B) hereto.

         C.       Fees and Expenses.

                  The Borrower shall have paid to the Agent and the Banks any
fees, including legal fees, or expenses payable under the Loan Documents.

4.       References to Credit Agreement; Inconsistency.

         On and after the Effective Date of this Third Amendment, any reference
to the Credit Agreement in any document, instrument, or agreement shall
hereafter mean and include the Credit Agreement as amended hereby. In the event
of inconsistency between the terms or provisions hereof and the terms or
provisions of the Credit Agreement or any Loan Document, the terms and
provisions hereof shall control.

5.       Force and Effect.

         Each of the Guarantors and the Borrower reconfirms, restates, and
ratifies the Credit Agreement and all other documents executed in connection
therewith except to the extent any such documents are expressly modified by this
Third Amendment and confirms that all such documents have remained in full force
and effect since the date of their execution.

                                      -4-
<PAGE>   5

6.       Governing Law.

         This Third Amendment shall be deemed to be a contract under the laws of
the Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed and enforced in accordance with the internal laws of the Commonwealth
of Pennsylvania without regard to its conflict of laws principles.

7.       Counterparts.

         This Third Amendment may be signed in any number of counterparts each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

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

                         [SIGNATURES BEGIN ON NEXT PAGE]

                                      -5-
<PAGE>   6

                   [SIGNATURE PAGE 1 OF 3 TO THIRD AMENDMENT]

                                            BORROWER:

                                            CHASE INDUSTRIES INC.

                                            By:  /s/ MICHAEL T. SEGRAVES
                                               ---------------------------------
                                            Name:    Michael T. Segraves
                                                 -------------------------------
                                            Title:   Chief Financial Officer
                                                  ------------------------------

                                            GUARANTORS:

                                            CHASE BRASS & COPPER COMPANY, INC.

                                            By:  /s/ MICHAEL T. SEGRAVES
                                               ---------------------------------
                                            Name:    Michael T. Segraves
                                                 -------------------------------
                                            Title:   Chief Financial Officer
                                                  ------------------------------

                                            LEAVITT TUBE COMPANY, INC.

                                            By:  /s/ MICHAEL T. SEGRAVES
                                               ---------------------------------
                                            Name:    Michael T. Segraves
                                                 -------------------------------
                                            Title:   Chief Financial Officer
                                                  ------------------------------

                                            HOLCO CORPORATION

                                            By:  /s/ MICHAEL T. SEGRAVES
                                               ---------------------------------
                                            Name:    Michael T. Segraves
                                                 -------------------------------
                                            Title:   Chief Financial Officer
                                                  ------------------------------

<PAGE>   7

                   [SIGNATURE PAGE 2 OF 3 TO THIRD AMENDMENT]

                                            AGENT AND BANKS:

                                            PNC BANK, NATIONAL ASSOCIATION,
                                            individually and as the Agent

                                            By: /s/ RICHARD C. MUNSICK
                                               ---------------------------------
                                            Name:   Richard C. Munsick
                                                 -------------------------------
                                            Title:  Managing Director
                                                  ------------------------------

                                            COMERICA BANK

                                            By:   /s/ ANTHONY L. DAVIS
                                               ---------------------------------
                                            Name:     Anthony L. Davis
                                                 -------------------------------
                                            Title:    Assistant Vice President
                                                  ------------------------------

                                            FIFTH THIRD BANK, NORTHWESTERN OHIO,
                                            N.A.

                                            By:   /s/ WILLIAM J. BEHE
                                               ---------------------------------
                                            Name:     William J. Behe
                                                 -------------------------------
                                            Title:    Senior Vice President
                                                  ------------------------------

<PAGE>   8

                   [SIGNATURE PAGE 3 OF 3 TO THIRD AMENDMENT]

                                            BANK ONE, MICHIGAN
                                            (f/k/a NBD Bank)

                                            By: /s/ PATRICK F. DUNPHY
                                               ---------------------------------
                                            Name: Patrick F. Dunphy
                                                 -------------------------------
                                            Title: Vice President
                                                  ------------------------------

                                            FIRSTAR BANK, N.A.
                                            f/k/a Star Bank

                                            By: /s/ DAVID J. DANNEMILLER
                                               ---------------------------------
                                            Name: David J. Dannemiller
                                                 -------------------------------
                                            Title: Vice President
                                                  ------------------------------

                                            NATIONAL CITY BANK

                                            By: /s/ PETER J. NOTTER
                                               ---------------------------------
                                            Name: Peter J. Notter
                                                 -------------------------------
                                            Title: Vice President
                                                  ------------------------------

                                            KEYBANK N.A.

                                            By: /s/ RICHARD W. HECK
                                               ---------------------------------
                                            Name: Richard W. Heck
                                                 -------------------------------
                                            Title: Senior Vice President
                                                  ------------------------------

<PAGE>   9

                         LIST OF SCHEDULES AND EXHIBITS

Schedules
Schedule 1.1(B)   Commitments Of The Banks
Schedule 6.1(b)   Holders Of Voting Common Stock Of Borrower
Schedule 6.1(h)   Litigation
Schedule 6.1(m)   Patents, Trademarks, Copyrights And Licenses
Schedule 6.1(o)   Insurance Policies
Schedule 6.1(q)   Material Contracts
Schedule 6.1(u)   Employee Benefit Plan Disclosures
Schedule 6.1(v)   Collective Bargaining Agreements
Schedule 6.1(w)   Environmental Matters

Exhibits
Exhibit 3(B) -    Matters to be addressed in Opinion of Counsel

<PAGE>   10

                                 Schedule 1.1(B)

                           List Of Banks, Commitments

<TABLE>
<CAPTION>

                          Revolving        Revolving
                           Credit            Credit            Swing Loan                           Aggregate
      Bank               Commitment       Ratable Share         Maximum          Commitment      Ratable Share*
------------------      ------------      -------------       ------------      ------------     --------------

<S>                     <C>               <C>                <C>               <C>               <C>
PNC Bank, National
Association             $ 10,000,000                20%      $  5,000,000      $ 10,000,000                 20%

Bank One, Michigan      $  8,000,000                16%                        $  8,000,000                 16%

National City Bank      $ 10,000,000                20%                        $ 10,000,000                 20%

Comerica Bank           $  4,000,000                 8%                        $  4,000,000                  8%

Firstar Bank, N.A.      $  4,000,000                 8%                        $  4,000,000                  8%

Keybank N.A.            $  4,000,000                 8%                        $  4,000,000                  8%

Fifth Third Bank,
Northwestern Ohio,
N.A.                    $ 10,000,000                20%                        $ 10,000,000                 20%
                        ------------      ------------       ------------      ------------       ------------

     Total              $ 50,000,000               100%      $  5,000,000      $ 50,000,000                100%
                        ============      ============       ============      ============       ============
</TABLE>

*Figures rounded to 4 decimal places. Actual percentages may be rounded to a
large number of decimal places.

<PAGE>   11

                                  EXHIBIT 3(B)

                  MATTERS TO BE ADDRESSED IN OPINION OF COUNSEL

         The opinion should address the topics covered in the warranties in the
Credit Agreement listed below. The opinion should cover this Third Amendment and
the Credit Agreement as amended by this Third Amendment.

<TABLE>
<CAPTION>

          Credit Agreement
            Section Ref.               Description
          -----------------            -----------
<S>                                   <C>
                    6.1(a)            Organization and Qualification
                    6.1(d)            Power and Authority
                    6.1(e)            Validity and Binding Effect
                    6.1(f)            No Conflict
                    6.1(h)            Litigation
                    6.1(l)            Consents and Approvals
</TABLE><PAGE>   1
                                                                   EXHIBIT 10.24

                           CHANGE OF CONTROL AGREEMENT

     This CHANGE OF CONTROL AGREEMENT ("Agreement") is entered into as of March
31, 1997, by and between Chase Brass Industries Inc., a Delaware corporation
("CBI"), and Michael T. Segraves ("Executive").

                                    Recitals

     A.   Executive currently is employed as Chief Financial Officer and Vice
          President-Finance of Chase Brass & Copper Company, Inc., a Delaware
          corporation and a wholly-owned subsidiary of CBI ("CBCC").

     B.   Executive and CBI agree that it is desirable that CBI provide greater
          employment security to Executive, and, to that end, the parties hereby
          enter into this Agreement.

     In consideration of the mutual agreements herein set forth and for good and
valuable consideration, receipt of which hereby is acknowledged the parties
agree as follows:

     1. Term of Agreement. The term of this Agreement (the "Term") shall be for
the period which commences on the date hereof and which terminates on December
31, 1999; provided, however, that (A) subject to Section 4.b. hereof, if, prior
to a Change of Control, Executive ceases for any reason to be an employee of
CBCC, thereupon the Term shall be deemed to have expired and this Agreement
shall immediately terminate and be of no further effect and (B) commencing on
December 31, 1999, and each December 31 thereafter, the Term of this Agreement
shall automatically be extended for an additional year unless at least 30 days
prior to any such date CBI or the Executive shall have given written notice that
CBI or the Executive, as the case may be, does not wish to have the Term of this
Agreement extended. Notwithstanding the expiration of the Term or other
termination of this Agreement, the provisions of Sections 6, 7, 10 and 11 of
this Agreement shall survive any expiration or termination of this Agreement
and, if a Change of Control shall occur prior to the expiration of the Term or
other termination of this Agreement, the terms of this Agreement shall survive
to the extent necessary to enable Executive to enforce his rights under Section
4 of this Agreement.

     2. Change of Employment to Affiliate. If, prior to a Change of Control,
Executive shall resign from his employment with CBCC but, upon such resignation,
shall become or remain an employee of CBI or any Subsidiary (other than CBCC) or
CBCC is party to a transaction that does not constitute a Change of Control but
in which CBCC is not a surviving corporation and Executive becomes employed by
the surviving entity then (i) such resignation or change in employer shall not
constitute a termination of Executive's employment for purposes of this
Agreement and (ii) thereafter, all references to CBCC contained in this
Agreement shall be deemed to refer to the entity by which Executive is then
employed.

     3. Definitions. For purposes of this Agreement, the following definitions
apply:

         a. Acquiring Person: shall mean any Person other than (a) Executive or
any Affiliate of Executive, or (b) CBI or any Subsidiary, any employee benefit
plan of CBI or any Subsidiary or of a corporation owned directly or indirectly
by the stockholders of CBI in substantially

                                       1

<PAGE>   2

the same proportions as their ownership of stock of CBI, or any trustee or other
fiduciary holding securities under an employee benefit plan of CBI or any
Subsidiary or of a corporation owned directly or indirectly by the stockholders
of CBI in substantially the same proportions as their ownership of stock of CBI,
or (c) Citicorp Venture Capital, Ltd., a New York corporation ("CVC"), or any
Affiliate of CVC that is directly controlled by Citicorp or Citibank, N.A., or
otherwise is in the same tier as CVC of Affiliates under the control of such
entities ("Direct Affiliates"), but shall not include any entities that may be
deemed an Affiliate of CVC as a result of the investment by any Direct Affiliate
in such entity.

         b. Affiliate: shall mean, with respect to any Person, any other Person
that directly or indirectly controls, is controlled by, or is under common
control with the Person in question. As used in this definition of "Affiliate,"
the term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of Voting Securities, by contract, or otherwise.

         c. Cause: shall mean

               (i) the continued failure by Executive to substantially perform
     his duties as an employee of CBCC or any other Subsidiary (other than any
     such failure resulting from Executive's incapacity due to physical or
     mental illness) after written demand for substantial performance is
     delivered by CBI specifically identifying the manner in which CBI believes
     Executive has not substantially performed his duties;

               (ii) dishonesty by Executive of a material nature that relates to
     the performance of Executive's duties as an employee of CBCC or any other
     Subsidiary or the commission by Executive of an act of fraud upon, or
     willful misconduct toward, CBI or any Subsidiary, as reasonably determined
     by the Board of Directors of CBI after a hearing following ten days' notice
     to Executive of such hearing;

               (iii) criminal conduct by Executive (other than minor infractions
     and traffic violations) or the conviction of Executive, by a court of
     competent jurisdiction, of any felony (or plea of nolo contendere thereto);

               (iv) a material violation by Executive of his duty of loyalty to
     CBI or any Subsidiary which results or may reasonably be expected to result
     in material injury to CBI or any Subsidiary;

               (v) the failure of Executive to cease any conduct determined by
     the Chief Executive Officer of CBI to be detrimental to the well-being or
     morale, or otherwise not in the best interest, of CBI or any Subsidiary
     after written demand directing Executive to cease such conduct is delivered
     by CBI specifically identifying such conduct and demanding cessation
     thereof;

               (vi) the use by Executive of alcohol which renders Executive
     unable to perform the essential functions of his position as an employee of
     CBCC or the use by Executive of illegal or controlled drugs or other
     substances; or

                                       2

<PAGE>   3

               (vii) a violation by Executive of Executive's covenants and
     obligations under Section 6 or Section 7 of this Agreement which is willful
     on Executive's part and which is not remedied to the reasonable
     satisfaction of CBI in a reasonable period of time after receipt of written
     notice from CBI.

Any termination of Executive's employment by CBCC for Cause shall be
communicated to Executive in a written notice of termination which shall set
forth in reasonable detail the facts and circumstances, if any, claimed to
provide a basis for such termination.

         d. Change of Control: shall be deemed to have occurred if:

               (i) any Acquiring Person is or becomes the "beneficial owner" (as
     defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended
     (the "Exchange Act"), directly or indirectly, of securities of CBI
     representing fifty percent or more of the combined voting power of the then
     outstanding Voting Securities of CBI; or

               (ii) a public announcement is made of a tender or exchange offer
     by any Acquiring Person for fifty percent or more of the outstanding Voting
     Securities of CBI, and the Board of Directors of CBI approves or fails to
     oppose that tender or exchange offer in its statements in Schedule 14D-9
     under the Exchange Act, provided, that, within one year after the
     occurrence of such event, an event described in clauses (i), (iii) or (iv)
     hereof shall have occurred (in which case a Change of Control shall be
     deemed to have occurred on the date of the occurrence of the event
     described above in this clause (ii));

               (iii) the stockholders of CBI approve a merger or consolidation
     of CBI with any other Person (or, if no such approval is required, the
     consummation of such a merger or consolidation of CBI), other than a merger
     or consolidation that would result in the Voting Securities of CBI
     outstanding immediately prior to the consummation thereof continuing to
     represent (either by remaining outstanding or by being converted into
     Voting Securities of the surviving entity or of a parent of the surviving
     entity) a majority of the combined voting power of the Voting Securities
     and Convertible Voting Securities (on a fully-diluted basis assuming full
     conversion thereof) of the surviving entity (or its parent) outstanding
     immediately after that merger or consolidation;

               (iv) the stockholders of CBI or CBCC approve a plan of complete
     liquidation of CBI or CBCC, respectively, or an agreement for the sale or
     disposition by CBI or CBCC of all or substantially all of CBI's or CBCC's
     assets, respectively, (or, if no such approval is required, the
     consummation of such a liquidation, sale, or disposition in one transaction
     or series of related transactions) other than a liquidation, sale or
     disposition of all or substantially all of CBI's or CBCC's assets in one
     transaction or a series of related transactions to a Subsidiary or any
     other Person owned directly or indirectly by the stockholders of CBI in
     substantially the same proportions as their ownership of stock of CBI; or

               (v) CBI ceases to be the "beneficial owner" (as defined in Rule
     13d-3 under the Exchange Act), directly or indirectly, of securities of
     CBCC representing at least

                                       3

<PAGE>   4

     a majority of the combined voting power of the then outstanding Voting
     Securities of CBCC other than pursuant to a transaction in which,
     immediately after the consummation of such transaction, all of the
     outstanding Voting Securities of CBCC or any Person into which CBCC is
     merged or otherwise consolidated which are not owned by CBI or any
     Subsidiary of CBI are owned, directly or indirectly, by the stockholders of
     CBI in substantially the same proportions as their ownership of stock of
     CBI immediately prior to such transaction.

         e. Convertible Voting Securities: shall mean any and all options,
warrants or other rights to purchase, or securities convertible into or
exchangeable or exercisable for, directly or indirectly, Voting Securities of
any Person.

         f. Good Reason: a resignation for Good Reason shall mean the
resignation by Executive from employment by CBCC after (i) a material reduction
or material adverse alteration in the nature of Executive's position,
responsibilities or authorities which Executive held immediately prior to the
Change of Control, (ii) any material reduction of Executive's compensation or
benefits to which Executive was entitled immediately prior to the Change of
Control, (iii) the relocation of Executive's principal place of employment to a
location which is 60 miles or more from Executive's principal residence
immediately prior to the Change of Control (provided such relocation shall not
constitute Good Reason unless such relocation also results in Executive's
principal place of employment being at least five miles further away from
Executive's principal residence immediately prior to the Change of Control),
(iv) any other material adverse change to the terms and conditions of
Executive's employment or benefits as in effect immediately prior to the Change
of Control, or (v) the liquidation, dissolution, merger, consolidation or
reorganization of CBI or transfer of all or substantially all of its assets in a
transaction that constitutes a Change of Control, unless the successor (by
liquidation, merger, consolidation, reorganization or otherwise) to which all or
a substantially all of its assets have been transferred (directly or by
operation of law) shall have assumed all duties and obligations of CBI under
this Agreement pursuant to Section 8.b. hereof; provided, that, (A) if Executive
shall consent in writing to any event described in clauses (i) through (iv) of
this paragraph, Executive's subsequent resignation shall not be treated as a
resignation for Good Reason unless a subsequent event described in such clauses
to which Executive did not consent occurs and (B) any changes in Executive's
discretionary bonus as from time to time determined by the Board of Directors of
CBI shall not constitute Good Reason for resignation. Notwithstanding the
foregoing, Executive shall be entitled to resign for Good Reason only if any
occurrence referred to in clauses (i), (ii), (iii), (iv) or (v) of this Section
3.f. is not remedied within 10 calendar days after receipt by CBI of written
notice from Executive setting forth in reasonable detail the facts and
circumstances giving rise to such Good Reason.

         g. Person: shall mean any individual, group, partnership, corporation,
association, trust, or other entity or organization.

         h. Retirement: shall mean a termination of Executive's employment other
than for Cause on or after Executive's attainment of age 65 (or such other age
as mutually agreed upon by Executive and CBI).

                                       4

<PAGE>   5

         i. Subsidiary: shall mean any corporation or other entity of which a
majority of the combined voting power of the outstanding Voting Securities is
owned, directly or indirectly, by CBI.

         j. Permanent Disability: shall mean any physical or mental disability
which shall have rendered Executive unable to perform his duties as an employee
of CBCC with or without reasonable accommodation for 120 consecutive days, or
which, in the opinion of a licensed physician reasonably satisfactory to CBI, is
likely to render Executive unable to perform his duties as an employee of CBCC
for such period with or without reasonable accommodation; provided, however,
that during any period of Executive's disability CBI or any Subsidiary may
assign Executive's duties to any other employee of CBI or such Subsidiary or may
engage or hire a third party to perform such duties and any such action shall
not be deemed "Good Reason" for Executive to terminate his employment.

         k. Voting Securities: shall mean (i) any securities or interests that
vote generally in the election of directors, in the admission of general
partners, or in the selection of any other similar governing body and (ii) with
respect to CBI, all shares of CBI's nonvoting common stock, par value $.01 per
share (all of which are convertible into shares of common stock, par value $.01
per share, of CBI).

     4. Severance Benefit.

         a. Benefits. If a Change of Control occurs prior to the expiration of
the Term or other termination of this Agreement and, within twelve months after
the date of the occurrence of such Change of Control, either (a) Executive's
employment with CBCC is terminated by CBCC other than (1) for Cause or (2) on
account of Executive's death, Permanent Disability or Retirement, or (b)
Executive resigns from CBCC for Good Reason (based on events occurring after the
Change of Control), then CBI shall:

               (i) pay to Executive, in a single lump sum which shall be paid
     within 30 days after the termination of employment or resignation, a
     severance payment in an amount equal to the sum of (A) the greater of (1)
     Executive's annual salary in effect immediately prior to the Change of
     Control and (2) Executives annual salary in effect at the time of
     termination or, if Executive resigns (or an event, which is not waived or
     consented to by Executive, occurs giving Executive the right to resign) his
     employment for Good Reason, immediately prior to the occurrence of the
     event giving rise to Good Reason, plus (B) the bonus, if any, paid or
     awarded to Executive for the most recent calendar year ended prior to the
     date of the Change of Control or, if bonuses for such calendar year have
     not been determined for such calendar year as of the date of the Change of
     Control, the prior calendar year;

               (ii) maintain in full force and effect, for the continued benefit
     of Executive (and, if applicable, Executive's spouse and dependent
     children) for a one-year period beginning upon the date of termination or
     resignation, all medical and dental insurance coverages as in effect and in
     which such Persons were participating immediately prior to the date of
     termination or resignation, provided that the continued participation of
     such Persons is possible under the general terms and provisions of such
     plans and arrangements; if the

                                       5

<PAGE>   6

     participation of any of such Persons in any such plan or arrangement is
     barred, CBI shall arrange to provide such Persons with insurance coverage
     substantially similar to those which such Persons would otherwise have been
     entitled to receive under such plans and arrangements from which such
     Persons' continued participation is barred; provided, however, that in
     either case, to the extent applicable, Executive pays to CBI an amount
     equal to the premiums, or portion thereof, that Executive was required to
     pay to maintain such insurance coverage for such Persons prior to the date
     of termination or resignation; and provided, further, that any insurance
     coverage provided pursuant hereto shall be limited and reduced to the
     extent such coverage otherwise is provided by (or available from or under),
     at no direct out-of-pocket cost to the recipient, any other employer of
     Executive or Executive's spouse or minor children, or Social Security,
     medicare, medicaid or any similar or substitute plans available to such
     Persons.

         b. Termination in Anticipation of Change of Control. For purposes of
this Section 4, if Executive's employment is terminated prior to a Change of
Control and Executive reasonably demonstrates that such termination (i) was at
the request of a Person who has indicated an intention or taken steps reasonably
calculated to effect a Change of Control and who effectuates a Change of Control
or (ii) otherwise occurred in connection with, or in anticipation of, a Change
of Control which actually occurs, then for all purposes hereof, a Change of
Control shall be deemed to have occurred and the date of a Change of Control
with respect to the employment shall mean the date immediately prior to the
termination date.

         c. Employment by Buyer. Notwithstanding the foregoing provisions of
this Section 4, if (i) there shall be a sale or disposition of all or
substantially all the assets of CBCC or a merger, consolidation or
reorganization to which CBCC is a party and is not a surviving corporation, (ii)
such transaction constitutes a Change of Control and (iii) Executive is offered
employment (at substantially the same level of Executive's authority,
responsibility, compensation and benefits with CBCC before such sale) with the
purchaser or corporation into which CBCC is merged or consolidated, as
applicable, or any of its Affiliates ("Buyer") upon consummation of such sale or
disposition, then Executive shall not be entitled to the severance compensation
as provided in Section 4.a. as a result of such transaction. In any such event,
however, Executive shall be entitled to such severance compensation as provided
in Section 4.a. if, within twelve months after the date of such transaction,
either (1) Executive's employment with the Buyer shall be terminated by the
Buyer other than (A) for Cause or (B) on account of Executive's death, Permanent
Disability or Retirement, or (2) Executive shall resign from the Buyer for Good
Reason. For purposes of this paragraph, the time of a termination of employment
or resignation, the definitions of "Permanent Disability," "Retirement,"
resignation for "Good Reason" and termination for "Cause," and the provisions of
Sections 6 and 7 shall be construed with reference to the Buyer instead of with
reference to CBCC and/or CBI, as applicable.

     5. No Reductions or Mitigation. The severance compensation to be provided
pursuant to Section 4 of this Agreement shall be paid and provided without
reduction, other than as expressly provided for therein, regardless of any
amounts of salary, compensation or other amounts which may be paid or payable to
Executive from any source or which Executive could have obtained upon seeking
other employment; provided that CBI shall be permitted to make all such payments
net of any legally required tax withholdings.

                                       6

<PAGE>   7

     6. Non-Competition.

         a. Covenant. Executive agrees that he will not, during or for a period
of one year following the termination of his employment with CBCC, (i) employ
any Person who was a salaried employee of or a consultant to CBI or any
Subsidiary during the six month period preceding such termination or induce,
request, advise, attempt to influence, or solicit, directly or indirectly, any
Person who was a salaried employee of or consultant to CBI or any Subsidiary
during the six month period preceding such termination to terminate his or her
employment or consulting arrangement with CBI or any Subsidiary, (ii) be
employed by, associated with or have any interest in, directly or indirectly
(whether as principal, director, officer, employee, consultant, partner,
stockholder, trustee, manager or otherwise), any company that engages in the
manufacture, distribution, licensing, sale, or marketing of copper alloy rod or
any other products manufactured, distributed, licensed, sold, or marketed by
CBCC during the Term (collectively, "Products"), or any company which otherwise
is directly competitive with CBCC or any subsidiary of CBCC, in any geographical
area in which CBCC or such subsidiary of CBCC engages in business at the time of
such termination or in which CBCC or any subsidiary of CBCC, prior to
termination of Executive's employment, evidenced in writing, at any time during
the six month period prior to such termination, its intention to engage in such
business (any such company, a "Competing Business"), (iii) induce, request,
advise, attempt to influence, or solicit, directly or indirectly, any Person to
purchase Products from any Person other than CBCC if CBCC provides, or
negotiated to provide, Products to that Person during the Term (any such Person
or Business Enterprise, a "Customer"), or (iv) induce, request, advise, attempt
to influence, or solicit, directly or indirectly, any Customer with whom
Executive had personal contact in connection with performing his duties as an
employee of CBCC to purchase Products from any Person other than CBCC; provided,
however, that the provisions of this Section 6 shall not apply in the event (i)
Executive's employment is terminated by CBCC other than (A) for "Cause" or (B)
on account of Executive's Permanent Disability or Retirement or (ii) Executive
terminates his employment for Good Reason. Notwithstanding the foregoing,
Executive shall not be prohibited from owning one percent or less of the
outstanding equity securities of any Competing Business whose equity securities
are listed on a national or regional securities exchange or publicly traded in
any over-the-counter market.

         b. Tolling of Non-Competition Term. If, during any calendar month after
the termination of Executive's employment by CBCC in which the provisions of
Section 6.a. are applicable, Executive is not in compliance with the terms of
Section 6.a., CBI shall be entitled to, among other remedies, compliance by
Executive with the terms of Section 6.a. for an additional number of calendar
months that equals the number of calendar months during which such noncompliance
occurred.

         c. Reasonableness of Restrictions. Executive acknowledges that the
geographic boundaries, scope of prohibited activities, and time duration of the
provisions of Section 6.a. are reasonable and are no broader than are necessary
to maintain and to protect the legitimate business interests of CBI and its
Subsidiaries.

         d. Separate Covenants. The parties hereto intend that the covenants
contained in each of subsections 6.a.(i), (ii), (iii) and (iv) of this Agreement
be construed as a series of separate covenants, one for each county or other
defined province or governmental subdivision in each

                                       7

<PAGE>   8

geographic area in which CBCC or any subsidiary of CBCC conducts its business or
otherwise manufactures, distributes, licenses, sells, or markets Products.
Except for geographic coverage, each such separate covenant shall be deemed
identical in terms to the applicable covenant contained in subsections 6.a.(i),
(ii), (iii) and (iv) hereof. Furthermore, each of the covenants in subsections
6.a.(i), (ii), (iii) and (iv) hereof shall be deemed a separate and independent
covenant, each being enforceable irrespective of the enforceability (with or
without reformation) of the other covenants contained in subsections 6.a.(i),
(ii), (iii) and (iv) hereof.

     7. Non-Disclosure. Executive shall not, directly or indirectly, at any time
during or for a two year period following termination of his employment with
CBCC, reveal, divulge or make known to any Person or entity, or use for
Executive's personal benefit (including without limitation for the purpose of
soliciting business, whether or not competitive with any business of CBI or any
Subsidiary), any information acquired by Executive during the course of
employment by CBCC with regard to the financial, business or other affairs of
CBI or any Subsidiary (including without limitation any list or record of
Persons or entities with which CBI or any Subsidiary has any dealings), other
than (i) information already in the public domain, (ii) information of a type
not considered confidential by Persons engaged in the same business or a
business similar to that conducted by CBI or any Subsidiary, (iii) information
that Executive is required to disclose under the following circumstances: (A) at
the express direction of any authorized governmental authority; (B) pursuant to
a subpoena or other court process; (C) as otherwise required by law or the
rules, regulations, or orders of any applicable regulatory body; or (D) as
otherwise necessary, in the opinion of counsel for Executive, to be disclosed by
Executive in connection with any legal action or proceeding involving Executive
and CBI or any Subsidiary in his capacity as an employee, officer, director, or
stockholder of CBI or any Subsidiary, or (iv) during the period of his
employment by CBCC, Executive may disclose such confidential information to
another employee of CBI or any Subsidiary or to representatives or agents of CBI
or any Subsidiary (such as independent accountants and legal counsel) when such
disclosure is reasonably necessary or appropriate in connection with the
performance by Executive of his duties on behalf of CBI or any Subsidiary.
Executive shall, at any time requested by CBI (either during or within two years
after the termination of Executive's employment with CBCC), promptly deliver to
CBI all memoranda, notes, reports, lists and other documents (and all copies
thereof) relating to the business of CBI or any Subsidiary which Executive may
then possess or have under his control.

     8. Binding Effect; Assignment.

         a. General. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and Executive's heirs and legal representatives
and CBI's successors and assigns. This Agreement is assignable by CBI to any
Person which acquires, directly or indirectly, by merger, consolidation,
purchase or otherwise, all or substantially all of the assets of CBI or CBCC or
a majority of the outstanding Voting Securities of CBCC. Upon any such
assignment, and the assumption by the assignee of all obligations hereunder, CBI
shall be released from all liability hereunder. This Agreement shall not be
assignable by Executive.

         b. Assumption by Successor. CBI shall require any successor (whether
direct or indirect, by purchase, merger, consolidation, reorganization or
otherwise) to all or substantially all of the business and/or assets of CBI to
expressly assume and agree to perform this Agreement in

                                       8

<PAGE>   9

the same manner and to the same extent CBI or CBCC, as applicable, would be
required to perform if no such succession had taken place.

     9. Nonalienation of Benefits. Benefits payable under this Agreement shall
not be subject in any manner to alienation, sale, transfer, assignment, pledge,
encumbrance, charge, garnishment, execution or levy of any kind (collectively
"Alienate"), either voluntary or involuntary, prior to actually being received
by Executive, other than by a transfer by the Executive's will or by the laws of
descent and distribution; and any attempt to alienate, sell, transfer, assign,
pledge, encumber, charge, garnish, execute on, levy or otherwise dispose of any
right to benefits payable hereunder contrary to this Section 9 shall be void ab
initio and of no force or effect and CBI shall have no obligation or liability
to pay any amounts so attempted to be Alienated.

     10. Severability. In the event that any provision of this Agreement
(including without limitation any provisions relating to the activities or areas
covered by, or time period of, the covenants provided for in subsections
6.a.(i), (ii), (iii) and (iv) hereof) or the application thereof to any Person
or circumstance, is held by a court of competent jurisdiction to be invalid,
illegal, or unenforceable in any respect under present or future laws effective
during the effective term of any such provision, such invalid, illegal or
unenforceable provision shall be fully severable; and this Agreement shall then
be construed and enforced as if such invalid, illegal, or unenforceable
provision had not been contained in this Agreement; and the remaining provisions
of this Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance
from this Agreement. Furthermore, in lieu of each such illegal, invalid, or
unenforceable provision, there shall be added automatically as part of this
Agreement, a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid and enforceable
and, subject to the following sentence, the parties hereby request the court or
any arbitrator to whom disputes relating to this Agreement are submitted to
reform any otherwise unenforceable covenants contained in Sections 6 and/or 7
hereof in accordance with the preceding provision. Notwithstanding the above, in
the event any such invalidity, illegality or unenforceability of any portion of
Section 6 hereof (including without limitation any provisions relating to the
activities or areas covered by, or time period of, the covenants provided for in
subsections 6.a.(i), (ii), (iii) and (iv) hereof), is caused by such provision
being held to be excessively broad as to time, duration, geographical scope,
activity or subject, then such provision shall, at the option of CBI, remain a
part of this Agreement and shall be construed by limiting and reducing it so as
to be enforceable to the extent compatible with the then applicable law and
shall be enforced so as to permit CBI or any Subsidiary to recover damages for
any prior violation of such provision as so limited and reduced, to the extent
permitted under applicable law.

     11. Specific Enforcement. Executive acknowledges that the covenants of
Executive contained in Sections 6 and 7 of this Agreement are special and
unique, that a breach by Executive of any term or provision of either of
Sections 6 or 7 hereof may cause irreparable injury to CBI and/or a Subsidiary,
and that remedies at law for the breach of any terms or provisions of Sections 6
or 7 hereof may be inadequate. Accordingly, in addition to any other remedies it
may have in the event of breach, CBI shall be entitled to enforce specific
performance of the terms and provisions of Sections 6 or 7 hereof, to obtain
temporary and permanent injunctive relief to prevent the continued breach of
such terms and provisions without the necessity of posting bond or of proving
actual damage, and to obtain attorneys fees in respect of the foregoing if CBI
prevails in such action or

                                       9

<PAGE>   10

proceeding. For purposes of this Section 11 and Sections 6 and 7 hereof, CBI,
CBCC and each subsidiary of CBCC shall be deemed a third party beneficiary
entitled to the benefits of such Sections and shall be entitled to enforce
Sections 6 and 7 of this Agreement in accordance with this Section 11
notwithstanding any assignment by CBI of its rights and obligations under this
Agreement.

     12. Entire Agreement; Amendment; Waiver. This Agreement represents the
entire agreement between the parties hereto with respect to the subject matter
hereof, and supersedes all prior or contemporaneous oral or written
negotiations, understandings and agreements between the parties hereto. This
Agreement shall not be altered, amended or modified except by written instrument
executed by CBI and Executive. A waiver of any term, covenant, agreement or
condition contained in this Agreement shall not be deemed a waiver of any other
term, covenant, agreement or condition, and any waiver of any default in any
such term, covenant, agreement or condition shall not be deemed a waiver of any
later default thereof or of any other term, covenant, agreement or condition.

     13. Legal Fees and Expenses. The prevailing party in any dispute or
controversy under or in connection with this Agreement shall be entitled to
reimbursement from the non-prevailing party for all costs and reasonable legal
fees incurred by such prevailing party.

     14. Applicable Law. The provisions of this Agreement shall be interpreted
and construed in accordance with the laws of the State of Ohio, without regard
to its choice of law principles.

     15. Notices. All notices, demands, requests or other communications that
may be or are required to be given, served or sent by either party to the other
party pursuant to this Agreement will be in writing and will be mailed by
first-class, registered or certified mail, return receipt requested, postage
prepaid, or transmitted by hand delivery or overnight courier, telegram or
facsimile transmission addressed as follows:

     (a) If to CBI:                   c/o Chase Brass & Copper Company, Inc.
                                      14212 County Road M-50
                                      Montpelier, Ohio 43543
                                      Telecopy No.: 419/485-8150
                                      Attention: Corporate Secretary

         with a copy (which will
         not constitute notice) to:   Vinson & Elkins L.L.P.
                                      2001 Ross Avenue, Suite 3700
                                      Dallas, Texas 75201
                                      Telecopy No.: (214) 999-7781
                                      Attention: Rodney L. Moore

     (b) If to Executive:             14212 County Road M-50
                                      Montpelier, Ohio 43543
                                      Telecopy No.: (419) 485-8150
                                      Attn: Michael T. Segraves

                                       10

<PAGE>   11

Either party may designate by written notice a new address to which any notice,
demand, request or communication may thereafter be given, served or sent. Each
notice, demand, request or communication that is mailed, delivered or
transmitted in the manner described above will be deemed sufficiently given,
served, sent and received for all purposes at such time as it is delivered to
the addressee with the return receipt, the delivery receipt, the affidavit of
messenger or (with respect to a facsimile transmission) the answer back being
deemed conclusive evidence of such delivery or at such time as delivery is
refused by the addressee upon presentation.

     16. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original, but all of which together will
constitute one and the same agreement.

     IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.

                                       CHASE BRASS INDUSTRIES INC.

                                       By: /s/ MARTIN V. ALONZO
                                           -------------------------------------
                                           Martin V. Alonzo, President

                                       EXECUTIVE: /s/ MICHAEL T. SEGRAVES
                                                  ------------------------------
                                                  Michael T. Segraves

                                       11

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