Document:

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                                                                     Exhibit 10a
                          CONSOLIDATED AMENDMENT NO. 1
                                       TO
                 MASTER LEASE AGREEMENT AND EQUIPMENT SCHEDULES

                  THIS CONSOLIDATED AMENDMENT NO. 1 TO MASTER LEASE AGREEMENT
(this "AMENDMENT"), dated as of June 30, 2000, is entered into by and between
Brush Wellman Inc., an Ohio corporation ("Lessee"), and National City Bank, for
itself and as agent for certain participants ("Lessor"),

                                    RECITALS:

                  A. Lessee and Lessor entered into a Master Lease Agreement,
dated as of December 30, 1996, as amended by the First Amendment to Master Lease
Agreement, dated as of September 2, 1997, the Second Amendment to Master Lease
Agreement and Amendment to Disbursement Schedules, dated as of January 26, 1999,
the Third Amendment to Master Lease Agreement and Amendment to Equipment
Schedules, dated as of September 30, 1999, and the Fourth Amendment to Master
Lease and Waiver, dated as of May 16, 2000 (together with all Exhibits and
Schedules thereto, the "Lease Agreement"), under which Lessor agreed to lease to
Lessee certain equipment to be used by Lessee at its Elmore, Ohio, facility,
subject to certain conditions and in accordance with the terms thereof; and

                  B. The parties desire to amend certain provisions of the
Master Lease Agreement and the Equipment Schedules thereto, and for ease of
reference, the parties also desire to restate and consolidate in this Amendment
all previous amendments to the Master Lease Agreement so that on and after the
Effective Date hereof (as defined in Section 6.02 of this Amendment), the
previous amendments to the Master Lease Agreement cease to be effective.

                                   AGREEMENT:

                  IN CONSIDERATION OF THE PREMISES above and the mutual
covenants and agreements contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

                       SECTION I - AMENDMENTS TO AGREEMENT

                  1.01 Section IV(a) of the Lease Agreement shall be amended by
deleting the same and substituting in lieu thereof the following:

                  "(a) Lessee will promptly notify Lessor in writing after
receipt of notice of any Tax or other mortgage, pledge, security interest,
encumbrance, lien, lease or charge of any kind (including any agreement or
consignment arrangement to give any of the foregoing, any conditional sale or
other title retention agreement or any lease in the nature thereof)
(collectively, a "LIEN") shall attach to any Disbursement Equipment or
Equipment, of the full particulars thereof and of the location of such
Disbursement Equipment or Equipment on the date of such notification."

                  1.02 Section IV(b) of the Lease Agreement shall be amended by
deleting the same and substituting in lieu thereof the following:

         "(b) Lessee will furnish or cause to be furnished to each Participant
and the Lessor:

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                  (i) ANNUAL FINANCIAL STATEMENTS. As soon as available and in
         any event within 90 days after the close of each fiscal year of the
         Parent, the consolidated and consolidating balance sheets of the Parent
         and the Subsidiaries as at the end of such fiscal year and the related
         consolidated and consolidating statements of income, of stockholder's
         equity and of cash flows for such fiscal year, in each case setting
         forth comparative figures for the preceding fiscal year, all in
         reasonable detail and, solely in the case of the consolidated financial
         statements, accompanied by the opinion with respect to such
         consolidated financial statements of independent public accountants of
         recognized national standing selected by the Parent, which opinion
         shall be unqualified and shall state that such accountants audited such
         consolidated financial statements in accordance with generally accepted
         auditing standards, that such accountants believe that such audit
         provides a reasonable basis for their opinion, and that in their
         opinion such consolidated financial statements present fairly in all
         material respects the financial position of the Parent and the
         Subsidiaries as at the end of such fiscal year and the results of their
         operations and cash flows for such fiscal year in conformity with GAAP.

                  (ii) QUARTERLY FINANCIAL STATEMENTS. As soon as available and
         in any event within 45 days after the close of each of the quarterly
         accounting periods in each fiscal year of the Parent, the unaudited
         consolidated and (commencing with the fiscal quarter ending March 31,
         2001) consolidating balance sheets of the Parent and the Subsidiaries
         as at the end of such quarterly period and the related unaudited
         consolidated and (commencing with the fiscal quarter ending March 31,
         2001) consolidating statements of income and of cash flows for such
         quarterly period, and setting forth, in the case of such unaudited
         statements of income and of cash flows, comparative figures for the
         related periods in the prior fiscal year, and which financial
         statements shall be certified as true and correct on behalf of the
         Parent by a Principal Officer of the Parent, subject to changes
         resulting from normal year-end audit adjustments.

                  (iii) OFFICER'S COMPLIANCE CERTIFICATES. At the time of the
         delivery of the financial statements provided for in sections IV(b)(i)
         and (ii), a certificate on behalf of a Principal Officer of the Parent
         to the effect that no Default or Potential Default exists or, if any
         Default or Potential Default does exist, specifying the nature and
         extent thereof, which certificate shall set forth the calculations
         required to establish compliance with the provisions of Sections
         XXIV(m)(e), (o)(c), (p)(k) and Section XXIII of this Agreement,
         including an identification of the amounts of any financial items of
         persons or business units acquired by the Parent or Lessee or their
         Subsidiaries for any periods prior to the date of acquisition which are
         used in making such calculations.

                  (iv) BUDGETS AND FORECASTS. Not later than 60 days after the
         commencement of each fiscal year of the Parent and the Subsidiaries, a
         consolidated and consolidating budget in reasonable detail for such
         entire fiscal year and for each of the fiscal quarters in such fiscal
         year, and (if and to the extent prepared by management thereof ) for
         any subsequent fiscal years, as customarily prepared by management for
         their internal use, setting forth, with appropriate discussion, the
         forecasted balance sheet, income statement, operating cash flows and
         capital expenditures of the Parent and the Lessee and their
         Subsidiaries for the period or periods covered thereby, and the
         principal assumptions upon which forecasts and budget are based.

                  (v) NOTICE OF DEFAULT OR LITIGATION.

                           (i) Promptly, and in any event within three Business
                  Days thereof, notice of the occurrence of any event which
                  constitutes a Default or Potential Default, which notice

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                  shall specify the nature thereof, the period of existence
                  thereof and what action Lessee or the Parent propose to take
                  with respect thereto; and

                           (ii) Promptly, and in any event within three Business
                  Days after Lessee or the Parent or any Subsidiary obtains
                  knowledge thereof, notice of any litigation or governmental or
                  regulatory investigation or proceeding pending against or
                  involving the Parent, Lessee or any of the Subsidiaries which
                  could reasonably be expected to have a Material Adverse
                  Effect.

                  (vi) ERISA. Promptly, and in any event within 15 days after
         the occurrence of any of the following, Lessee will deliver to Lessor
         and each Participant a certificate on behalf of Lessee and the Parent
         of an Authorized Officer of setting forth the full details as to such
         occurrence and the action, if any, that the Parent, Lessee, such
         Subsidiary or such ERISA Affiliate is required or proposes to take,
         together with any notices required or proposed to be given to or filed
         with or by the Parent, Lessee, the Subsidiary, the ERISA Affiliate, the
         PBGC, a Plan participant or the Plan administrator with respect
         thereto:

                           (i) that a Reportable Event has occurred with respect
                  to any Plan;

                           (ii) the institution of any steps by the Parent,
                  Lessee, any ERISA Affiliate, the PBGC or any other person to
                  terminate any Plan;

                           (iii) the institution of any steps by the Parent or
                  Lessee or any ERISA Affiliate to withdraw from any Plan;

                           (iv) the institution of any steps by the Parent or
                  Lessee or any Subsidiary to withdraw from any Multiemployer
                  Plan or Multiple Employer Plan, if such withdrawal could
                  result in withdrawal liability (as described in Part 1 of
                  Subtitle E of Title IV of ERISA) in excess of $5,000,000;

                           (v) a non-exempt "prohibited transaction" within the
                  meaning of section 406 of ERISA in connection with any Plan;

                           (vi) that a Plan has an Unfunded Current Liability
                  exceeding $5,000,000;

                           (vii) any material increase in the contingent
                  liability of the Parent or Lessee or any Subsidiary with
                  respect to any post-retirement welfare liability; or

                           (viii) the taking of any action by, or the written
                  threat of the taking of any action by, the Internal Revenue
                  Service, the Department of Labor or the PBGC with respect to
                  any of the foregoing.

                  (vii) ENVIRONMENTAL MATTERS. Promptly upon, and in any event
         within 5 days after the occurrence of any of the following, notice of
         any of the following environmental matters which involves or could
         reasonably be expected to result in a Material Adverse Effect: (i) any
         pending or threatened (in writing) Environmental Claim against the
         Parent, Lessee or any of the Subsidiaries or any Real Property owned or
         operated by any of them; (ii) any condition or occurrence on or arising
         from any Real Property owned or operated by the Parent or Lessee or any
         of the Subsidiaries that (A) results in noncompliance by the Parent or
         Lessee or any of the Subsidiaries

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         with any applicable Environmental Law or (B) could reasonably be
         expected to form the basis of an Environmental Claim against the Parent
         or Lessee or any of the Subsidiaries or any such Real Property; (iii)
         any condition or occurrence on any Real Property owned, leased or
         operated by the Parent or Lessee or any of the Subsidiaries that could
         reasonably be expected to cause such Real Property to be subject to any
         restrictions on the ownership, occupancy, use or transferability by the
         Parent or Lessee or any of the Subsidiaries of such Real Property under
         any Environmental Law; and (iv) the taking of any removal or remedial
         action in response to the actual or alleged presence of any Hazardous
         Material on any Real Property owned, leased or operated by the Parent
         or Lessee or any of the Subsidiaries as required by any Environmental
         Law or any governmental or other administrative agency. All such
         notices shall describe in reasonable detail the nature of the
         Environmental Claim and the Parent's or Lessee's or such Subsidiary's
         response thereto.

                  (h) SEC REPORTS AND REGISTRATION STATEMENTS. Promptly upon
         transmission thereof or other filing with the SEC, copies of all
         registration statements and annual, quarterly or current reports that
         the Parent or Lessee or any of the Subsidiaries files with the SEC, and
         promptly upon transmission thereof, each proxy statement, annual
         report, certificate, notice or other document sent by the Parent or
         Lessee to the holders of any of its securities (or any trustee under
         any indenture which secures any of its securities or pursuant to which
         such securities are issued).

                  (i) OTHER INFORMATION. Such other information or documents
         (financial or otherwise) relating to the Parent or Lessee or any of the
         Subsidiaries as Lessor or any Participant may reasonably request from
         time to time."

                  1.03 Section XI(a) of the Lease Agreement shall be amended by
deleting Paragraph (v) and by deleting Paragraphs (ii), (iii), (iv), (vi), (vii)
and (ix) and substituting in lieu thereof the following:

                  "(ii) If any representation, warranty or statement made in
         this Agreement or in any Schedule or the Guaranty, the Pledge Agreement
         or any other Lease Document or any other certificate, report, notice or
         other writing delivered to Lessor in respect of this Agreement shall be
         false or erroneous in any Material respect when made or deemed made,

                  (iii) If Lessee fails to perform or observe (1) any of its
         obligations in Section IX or Section XXIII or Section XXIV, (2) any of
         its obligations under the Assignment of Purchase Orders or any other
         Document or B. W. Alloy, Ltd. shall fail to perform or observe any of
         its obligations under the Assignment of Purchase Orders or any other
         Document to which it is a party, or (3) any of its other obligations in
         this Agreement (other than those referred to in clauses (i) and
         (iii)(1) and (iii)(2) above) and that failure shall not have been fully
         corrected within thirty (30) days after the giving of written notice to
         Lessee by Lessor that it is to be remedied, provided, however, if
         during that thirty-day period Lessee shall commence corrective action
         that, if begun and prosecuted with due diligence, cannot be completed
         within a period of thirty (30) days, then that thirty-day period shall
         be extended, but not more than an additional forty (40) days, to the
         extent necessary to enable Lessee to diligently complete that
         corrective action; or the Pledge Agreement, the Guaranty or any other
         Lease Document (once executed and delivered) shall cease for any reason
         (other than termination in accordance with its terms) to be in full
         force and effect; or any Lease Party shall default in any material
         respect in the due performance and observance of any other obligation
         under a Lease Document (other than this Agreement) to which it is a
         party and such default shall continue unremedied for a period of at
         least 30 days (or such other longer cure period permitted under the
         applicable Lease Document) after notice by Lessor; or any Lease Party
         shall (or seek to)

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         disaffirm or otherwise limit its obligations under a Lease Document to
         which it is a party otherwise than in strict compliance with the terms
         thereof,

                  (iv) Lessee, the Parent or any of the Subsidiaries shall (i)
         default in any payment with respect to any Indebtedness (other than the
         obligations of Lessee under this Agreement) or Permitted Precious Metal
         Consignments in excess, individually, of $25,000 owed to Lessor or any
         Participant or any of their Affiliates, or to any other person, and
         such default shall continue after the applicable grace period, if any,
         specified in the agreement or instrument relating to such Indebtedness
         or Permitted Precious Metal Consignment, or (ii) default in the
         observance or performance of any agreement or condition relating to any
         such Indebtedness or Permitted Precious Metal Consignment or contained
         in any instrument or agreement evidencing, securing or relating thereto
         (and all grace periods applicable to such observance, performance or
         condition shall have expired), or any other event shall occur or
         circumstance shall exist, the effect of which default or other event or
         circumstance is to cause, or to permit the holder or holders of such
         Indebtedness or other party to a Permitted Precious Metal Consignment
         (or a trustee or agent on behalf of such holder or holders or other
         party) to cause any such Indebtedness to become due prior to its stated
         maturity or any obligation thereunder to become due prior to the date
         contemplated therein; or any such Indebtedness of the Parent or Lessee
         or any of the Subsidiaries or any obligation under a Permitted Precious
         Metal Consignment shall be declared to be due and payable, or shall be
         required to be prepaid (other than by a regularly scheduled required
         prepayment or redemption, prior to the stated maturity thereof),

                  (vi) If (a) Lessee or the Parent or any Material Subsidiary
         shall discontinue operations, or (b) Lessee or Parent or any Material
         Subsidiary shall commence any Insolvency Action of any kind or admit
         (by answer, default or otherwise) the Material allegations of, or
         consent to any relief requested in, any Insolvency Action of any kind
         commenced against Lessee or Parent or such Material Subsidiary by its
         creditors or any thereof, or (c) any creditor or creditors shall
         commence against Lessee or Parent or any Material Subsidiary any
         Insolvency Action of any kind which shall remain in effect (neither
         dismissed nor stayed) for thirty (30) consecutive days,

                  (vii) If there shall occur a Change of Control,

                  (ix) one or more judgments or decrees shall be entered against
Lessee or the Parent or any of the Subsidiaries involving a liability equal to
or more than $5,000,000 in the aggregate for all such judgments and decrees for
the Parent, Lessee and the Subsidiaries (excluding any judgment covered by
insurance as to which the carrier has adequate claims paying ability and has not
reserved its rights), and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 30 days from the
entry thereof,"

                  1.04 Section XVI(a) of the Lease Agreement shall be amended by
deleting the first sentence therein and substituting in lieu thereof the
following:

                  "Lessee has adequate power and authority to enter into, and
perform and observe its obligations under, this Agreement, each Schedule, each
Assignment of Purchase Orders to which it is a party and all other agreements,
instruments, documents and other writings related to this Agreement, including,
without limitation, the Lease Documents (collectively, the "DOCUMENTS")."

                  1.05 Section XIX(j) of the Lease Agreement shall be amended by
deleting the same and inserting the following in lieu thereof:

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                  "(j) Any Rent, Interim Rent or other amount not paid to Lessor
         when due hereunder (after any applicable grace period therefor) shall
         bear interest, both before and after any judgment or termination
         hereof, at the lesser of the Daily Lease Rate Factor then in effect
         plus two percent (2%) per annum or the maximum rate allowed by law. In
         addition, after the occurrence and during the continuance of a Default,
         the Daily Lease Rate Factor shall be increased by an amount equal to
         two percent (2%) per annum."

                  1.06 Section XXIII of the Lease Agreement shall be amended by
deleting the same and substituting in lieu thereof the following:

"XXIII. GENERAL FINANCIAL STANDARDS:

         Lessee agrees that so long as this Agreement remains in effect and
thereafter until all obligations of Lessee hereunder shall have been paid and
performed in full, Lessee will observe and cause to be observed each of the
following:

         (a) RATIO OF CONSOLIDATED TOTAL DEBT TO CONSOLIDATED TOTAL ADJUSTED
CAPITAL. At no time will the ratio, expressed as a percentage, of (x) the amount
of Consolidated Total Debt to (y) Consolidated Total Adjusted Capital, exceed
50.0%.

         (b) RATIO OF CONSOLIDATED TOTAL DEBT TO CONSOLIDATED EBITDAR. The ratio
at any time of (x) the amount of Consolidated Total Debt at such time to (y)
Consolidated EBITDAR for the Testing Period most recently ended, will not exceed
(i) 3.50 to 1.00 for the Testing Period ending June 30, 2000, (ii) 3.25 to 1.00
for the Testing Periods ending September 30, 2000 and December 31, 2000, (iii)
3.00 to 1.00 for the Testing Periods ending March 31, 2001, June 30, 2001, and
September 30, 2001; and (iv) 2.75 to 1.00 for the Testing Periods ending on and
after December 31, 2001.

         (c) CONSOLIDATED FIXED CHARGE COVERAGE RATIO. At no time will the
Consolidated Fixed Charge Coverage Ratio be less than 2.00 to 1.00 for any
Testing Period.

         (d) CONSOLIDATED TANGIBLE NET WORTH. At no time will the Consolidated
Tangible Net Worth be less than $190,731,000 plus an amount equal to forty
percent (40%) of the Consolidated Net Income of the Parent, Lessee and the
Subsidiaries for the four fiscal quarters ending December 31, 2000 and each
December 31 thereafter; provided, that if such Consolidated Net Income for any
fiscal year is a negative figure, such Consolidated Net Income for the fiscal
year in question shall be treated as zero for the purposes of this section."

                  1.07 Section XXIV of the Lease Agreement shall be amended by
deleting the same and substituting in lieu thereof the following:

"XXIV.   COVENANTS:

         Lessee agrees that so long as this Agreement remains in effect and
thereafter until the Rent and all obligations of Lessee hereunder shall have
been paid and performed in full, Lessee will perform and observe, and will cause
the Parent and each Subsidiary to perform and observe, each of the following
provisions on their respective parts to be complied with, namely:

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         (a) BOOKS, RECORDS AND INSPECTIONS. (i) keep proper books of record and
account, in which full and correct entries shall be made of all financial
transactions and the assets and business of the Parent, Lessee or the
Subsidiaries, as the case may be, in accordance with GAAP; and (ii) permit
officers and designated representatives of the Lessor or any of the Participants
to visit and inspect any of the properties or assets of the Parent, Lessee and
the Subsidiaries in whomsoever's possession, and to examine (and make copies of
or take extracts from) the books of account of the Parent, Lessee and the
Subsidiaries and discuss the affairs, finances and accounts of the Parent,
Lessee and the Subsidiaries with, and be advised as to the same by, their
officers and independent accountants and independent actuaries, if any, all at
such reasonable times and intervals upon reasonable notice (except that during
the existence of a Default, no notice shall be required) as the Lessor or any of
the Participants may request.

         (b) INSURANCE. (i) maintain insurance coverage by insurers having an
A.M. Best rating of "A-" or better and being in a financial size category of
"VII" or larger, or by other companies acceptable to the Lessor, and in such
forms and amounts and against such risks as are generally consistent with the
insurance coverage maintained by the Parent, Lessee and the Subsidiaries at the
date hereof, but at a minimum shall keep themselves and all of their insurable
properties insured at all times to such extent, with such deductibles, by such
insurers and against such hazards and liabilities as is generally done by other
business enterprises respectively similar to the Parent, Lessee and the
Subsidiaries, and (ii) forthwith upon Lessor's or any Participant's written
request, furnish to Lessor or such Participant such information about such
insurance as Lessor or such Participant may from time to time reasonably
request, which information shall be prepared in form and detail satisfactory to
Lessor or such Participant and certified by an Authorized Officer of the Lessee.

         (c) PAYMENT OF TAXES AND CLAIMS. Pay and discharge all taxes,
assessments and governmental charges or levies imposed upon Lessee, the Parent
and the Subsidiaries or upon their income or profits, or upon any properties
belonging to them, prior to the date on which penalties attach thereto, and all
lawful claims which, if unpaid, might become a Lien or charge upon any
properties of the Parent, Lessee or any of the Subsidiaries; PROVIDED that none
of the Parent, Lessee or any of the Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim which is being contested in good
faith and by proper proceedings if it has maintained adequate reserves with
respect thereto in accordance with GAAP; and PROVIDED, FURTHER, that the Parent,
Lessee and the Subsidiaries will not be considered to be in default of any of
the provisions of this sentence if the Parent, Lessee or any Subsidiary fails to
pay any such amount or amounts that, individually or in the aggregate, do not
exceed $500,000 so long as that matter is being negotiated in good faith with
the applicable taxing authority.

         (d) CORPORATE FRANCHISES. Do and cause to be done all things necessary
to preserve and keep in full force and effect the corporate or other
organizational existence, rights, authority and franchises of the Parent, Lessee
and the Subsidiaries, PROVIDED that nothing in this Paragraph (d) shall be
deemed to prohibit any transaction permitted by Paragraph (m) below.

         (e) GOOD REPAIR. Ensure that the properties and equipment of the
Parent, Lessee and the Subsidiaries used or useful in their business in
whomsoever's possession they may be, are kept in good repair, working order and
condition, normal wear and tear excepted.

         (f) COMPLIANCE WITH STATUTES, ETC. Comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of the
business of the Parent, Lessee and the Subsidiaries and the ownership of their
property, other than those (i) being contested in good faith by appropriate
proceedings, as to which

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adequate reserves are established to the extent required under GAAP, and (ii)
the noncompliance with which could not reasonably be expected to have a Material
Adverse Effect.

         (g) COMPLIANCE WITH ENVIRONMENTAL LAWS. Notwithstanding, and in
addition to, the covenants contained in Paragraph (f) above:

                  (a) comply in all respects with all Environmental Laws
         applicable to the ownership, lease or use of all Real Property and
         personal property now or hereafter owned, leased or operated by the
         Parent, Lessee or any of the Subsidiaries, and promptly pay or cause to
         be paid all costs and expenses incurred in connection with such
         compliance, the noncompliance with which could reasonably be expected
         to have a Material Adverse Effect; and (iii) keep or cause to be kept
         all such Real Property free and clear of any Liens imposed pursuant to
         such Environmental Laws which are not permitted under Paragraph (n)
         below.

                  (b) Without limitation of the foregoing, if the Parent, Lessee
         or any of the Subsidiaries shall generate, use, treat, store, release
         or dispose of, or permit the generation, use, treatment, storage,
         release or disposal of, Hazardous Materials on any Real Property now or
         hereafter owned, leased or operated by any of them, or transport or
         permit the transportation of Hazardous Materials to or from any such
         Real Property, any such action shall be effected in compliance with all
         Environmental Laws applicable thereto.

                  (c) If required to do so under any applicable order of any
         governmental agency, take any clean up, removal, remedial or other
         action necessary to remove and clean up any Hazardous Materials from
         any Real Property owned, leased or operated by the Parent, Lessee or
         any of the Subsidiaries in accordance with the requirements of all
         applicable Environmental Laws and in accordance with such orders of all
         governmental authorities, except to the extent that the Parent, Lessee
         or such Subsidiary is contesting such order in good faith and by
         appropriate proceedings and for which adequate reserves have been
         established to the extent required by GAAP.

         (h) FISCAL YEARS, FISCAL QUARTERS. Not change its fiscal year or fiscal
quarters, other than the fiscal year or fiscal quarters of a person which
becomes a Subsidiary, made at the time such person becomes a Subsidiary to
conform to Lessee's fiscal year and fiscal quarters.

         (i) HEDGE AGREEMENTS, ETC. In the event the Parent, Lessee or any of
the Subsidiaries determine to enter into a Hedge Agreement they may do so,
PROVIDED that such Hedge Agreement, when considered in light of other
outstanding Hedge Agreements to which that person is a party, does not expose
that person to predominantly speculative risks unrelated to the amount of
assets, Indebtedness or other liabilities intended to be subject to coverage on
a notional basis under such Hedge Agreement. The parties to any Financial Hedge
Agreement, the calculation of credit exposure under any Financial Hedge
Agreement, any intercreditor issues with the Lessor and Participants and the
documentation therefor (which shall conform in all respects to ISDA standards)
must be reasonably acceptable to the Lessor in all respects.

         (j) SENIOR DEBT. Ensure that (a) the claims of the Lessor and the
Participants in respect of Rent and the other obligations of Lessee under this
Agreement will not be subordinate to, and will in all respects at least rank
PARI PASSU with, the claims of every other senior unsecured creditor of the
Lessee, and (b) any Indebtedness subordinated in any manner to the claims of any
other senior unsecured creditor of the Lessee will be subordinated in like
manner to such claims of Lessor and the Participants.

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         (k) SECURITY DOCUMENTS. In order to secure the payment of Rent and the
other obligations of Lessee, the Parent and Lessee will pledge as collateral to
the Lessor, as collateral agent, the capital stock in each of the following
Subsidiaries of the Parent: Williams Advanced Materials Inc., a New York
corporation, Circuits Processing Technologies, Inc., a California corporation,
Technical Materials, Inc., an Ohio corporation, and Brush International, Inc.,
an Ohio corporation. In connection with the foregoing stock pledges, the Parent
and Lessee will deliver for possession by the Lessor, as collateral agent, the
stock certificate(s) representing 100% of the capital stock of, or other equity
or ownership interest in, such Subsidiaries and execute and deliver to the
Lessor, as collateral agent, the Pledge Agreement in the form attached to the
Credit Agreement as in effect on the Effective Date as Exhibit F. The Parent and
Lessee will also pledge as collateral to the Lessor, as collateral agent, the
capital stock of any existing Domestic Subsidiary that becomes a Material
Subsidiary after the date of this Agreement and of any Domestic Subsidiary
created or acquired by the Parent or Lessee or any Domestic Subsidiary after the
date of this Agreement. The above-described pledges of capital stock shall grant
to the Lessor, as collateral agent, a first priority perfected lien on 100% of
the capital stock of each such Domestic Subsidiary that is owned by Lessee or
the Parent or any Domestic Subsidiary of either of them, as the case may be.

         (l) CHANGES IN BUSINESS. None of the Parent, Lessee and any of the
Subsidiaries will engage in any business if, as a result, the general nature of
the business which would then be engaged in by that person would be
substantially changed from the general nature of the business engaged in by the
Parent, Lessee or any Subsidiary on the Effective Date.

         (m) CONSOLIDATION, MERGER, ACQUISITIONS, ASSET SALES, ETC. None of the
Parent, Lessee or any of the Subsidiaries will (1) wind up, liquidate or
dissolve its affairs, (2) enter into any transaction of merger or consolidation,
(3) make or otherwise effect any Acquisition, (4) sell or otherwise dispose of
any of their property or assets outside the ordinary course of business, or
otherwise make or otherwise effect any Asset Sale, or (5) agree to do any of the
foregoing at any future time, EXCEPT that the following shall be permitted:

                  (a) CERTAIN INTERCOMPANY MERGERS, ETC. If no Default or
         Potential Default shall have occurred and be continuing or would result
         therefrom,

                           (i) the merger, consolidation or amalgamation of any
                  Subsidiary of Lessee or Parent (other than Lessee) with or
                  into Lessee or the Parent, PROVIDED Lessee or the Parent is
                  the surviving or continuing or resulting corporation;

                           (ii) the Reorganization; or the merger, consolidation
                  or amalgamation of any Subsidiary of the Parent (other than
                  Lessee) or any Subsidiary of Lessee that is not a Pledged
                  Company with or into another Subsidiary of the Parent (other
                  than Lessee) or another Subsidiary of Lessee, PROVIDED that
                  the surviving or continuing or resulting corporation is a
                  Wholly-Owned Subsidiary that is a Domestic Subsidiary directly
                  owned by the Parent or Lessee or a Pledged Company that is a
                  Wholly-Owned Subsidiary of the Parent or Lessee;

                            (iii) the liquidation, winding up or dissolution of
                  any Subsidiary of the Parent (other than Lessee) or any
                  Subsidiary of Lessee, other than a Material Subsidiary;

                           (iv) the transfer or other disposition of any
                  property by any Subsidiary of the Parent or Lessee, other than
                  Lessee or a Pledged Company, to the Parent or Lessee or to any
                  Wholly-Owned Subsidiary directly owned by the Parent or
                  Lessee;

                                     Page 9
<PAGE>   10

                           (v) the merger, consolidation or amalgamation of any
                  Pledged Company with or into another Pledged Company; and

                           (vi) the transfer or other disposition of any
                  property by any Pledged Company to the Parent or Lessee or to
                  another Pledged Company.

                  (b) ACQUISITIONS. If no Default or Potential Default shall
         have occurred and be continuing or would result therefrom, the Parent
         or Lessee or any Subsidiary may make any Acquisition that is a
         Permitted Acquisition, PROVIDED that all of the conditions contained in
         the definition of the term Permitted Acquisition are satisfied.

                  (c) PERMITTED DISPOSITIONS. If no Default or Potential Default
         shall have occurred and be continuing or would result therefrom, the
         Parent or Lessee or any of the Subsidiaries may, except with respect to
         the Equipment, (i) sell any property, land or building (including any
         related receivables or other intangible assets) to any person, or (ii)
         sell the entire capital stock (or other equity interests) and
         Indebtedness of any Subsidiary, other than Lessee or a Material
         Subsidiary, owned by the Parent or Lessee or any other Subsidiary,
         other than Lessee or a Material Subsidiary, to any person, or (iii)
         permit any Subsidiary, other than Lessee or a Material Subsidiary, to
         be merged or consolidated with a person which is not an Affiliate of
         the Parent or Lessee, or (iv) consummate any other Asset Sale with a
         person who is not a Subsidiary of the Parent or Lessee; PROVIDED that:

                           (A) the consideration for such transaction (1)
                  represents fair value (as determined by management of Lessee),
                  and at least 80% of such consideration consists of cash, and
                  (2) does not exceed, when aggregated with the consideration of
                  any other transaction or transactions of the Parent, Lessee or
                  any Subsidiary during the then current fiscal year permitted
                  under this Paragraph (m)(c), $10,000,000,

                           (B) in the case of any such transaction involving
                  consideration equal to or in excess of $1,000,000, at least
                  five Business Days prior to the date of completion of such
                  transaction Lessee shall have delivered to the Lessor an
                  officer's certificate executed on behalf of Lessee by
                  Principal Officers of Lessee, which certificate shall contain
                  (1) a description of the proposed transaction, the date such
                  transaction is scheduled to be consummated, the estimated
                  purchase price or other consideration for such transaction,
                  (2) a certification that no Default or Potential Default has
                  occurred and is continuing, or would result from consummation
                  of such transaction, and (3) which shall (if requested by
                  Lessor) include a certified copy of the draft or definitive
                  documentation pertaining thereto; and

                           (C) contemporaneously with the completion of such
                  transaction the Parent and Lessee prepay their obligations
                  under the Credit Agreement as and to the extent required by
                  section 5.2 thereof; and

                  PROVIDED, FURTHER, that sales or other dispositions of
         inventory in the ordinary course of business or of obsolete or worn out
         equipment or fixtures (other than the Equipment) in the ordinary course
         of business may be effected without compliance with the above
         provisions and the

                                    Page 10
<PAGE>   11

         amount of any such sales or other dispositions shall be excluded from
         any computations under this Paragraph (m)(c).

                  (d) LEASES. The Parent, Lessee and the Subsidiaries may enter
         into leases of property or assets not constituting Acquisitions,
         PROVIDED such leases are not otherwise in violation or could cause a
         violation of Paragraph (u) below or any other provision of this
         Agreement.

                  (e) CAPITAL EXPENDITURES: The Parent, Lessee and the
         Subsidiaries shall be permitted to make Consolidated Capital
         Expenditures, PROVIDED that (A) expenses for mining property, plant and
         equipment shall not exceed $25,000,000 during any consecutive
         thirty-six (36) month period, and (B) Consolidated Capital
         Expenditures, excluding expenses for mining property, plant or
         equipment, do not during any fiscal year of the Parent exceed the
         amount specified below:

<TABLE>
<CAPTION>
                  --------------------------------------- ---------------------------------------

                  FISCAL YEAR ENDING                      AMOUNT

                  --------------------------------------- ---------------------------------------

<S>                                                                     <C>
                  December 31, 2000                                     $35,000,000
                  --------------------------------------- ---------------------------------------

                  December 31, 2001                                     $40,000,000
                  --------------------------------------- ---------------------------------------

                  December 31, 2002                                     $45,000,000
                  --------------------------------------- ---------------------------------------

                  December 31, 2003 and each fiscal                     $50,000,000
                  year thereafter
                  --------------------------------------- ---------------------------------------
</TABLE>

                  (f) PERMITTED INVESTMENTS. The Parent, Lessee and the
         Subsidiaries shall be permitted to make the investments permitted
         pursuant to Paragraph (p) below.

         (n) LIENS. None of the Parent, Lessee or the Subsidiaries will create,
incur, assume or suffer to exist any Lien upon or with respect to any of its
property or assets of any kind (real or personal, tangible or intangible)
whether now owned or hereafter acquired, or sell any such property or assets
subject to an understanding or agreement, contingent or otherwise, to repurchase
such property or assets (including consignment arrangements and including sales
of accounts receivable or notes with or without recourse to the Parent, Lessee
or any of the Subsidiaries, other than for purposes of collection of delinquent
accounts in the ordinary course of business) or assign any right to receive
income, or file or permit the filing of any financing statement under the UCC or
any other similar notice of Lien under any similar recording or notice statute,
EXCEPT that (i) the foregoing restrictions and the following exceptions in this
paragraph shall not apply to the Equipment, which is subject to the restrictions
set forth in Section V(c), and (ii) the foregoing restrictions shall not apply
to:

                  (a) STANDARD PERMITTED LIENS: the Standard Permitted Liens and
         Liens granted to the Lessor on behalf of the Participants;

                                    Page 11
<PAGE>   12

                  (b) EXISTING LIENS, ETC.: Liens (i) in existence on the
         Effective Date which are listed, and the Indebtedness secured thereby
         and the property subject thereto on the Effective Date described, in
         Annex IV to the Credit Agreement on the Effective Date, or (ii) arising
         out of the refinancing, extension, renewal or refunding of any
         Indebtedness secured by any such Liens, PROVIDED that the principal
         amount of such Indebtedness is not increased and such Indebtedness is
         not secured by any additional assets;

                  (c) PURCHASE MONEY LIENS: Liens which are placed upon fixed or
         capital assets, acquired, constructed or improved by the Parent or
         Lessee or any Subsidiary, PROVIDED that (A) such Liens secure
         Indebtedness permitted by Paragraph (o)(c) below, (B) such Liens and
         the Indebtedness secured thereby are incurred prior to or within 30
         days after such acquisition or the completion of such construction or
         improvement, (C) the Indebtedness secured thereby does not exceed 100%
         of the cost of acquiring, constructing or improving such fixed or
         capital assets; and (D) such Liens shall not apply to any other
         property or assets of the Parent, Lessee or any Subsidiary; and

                  (d) INVENTORY CONSIGNMENTS: Liens granted in connection with:
         (i) any Permitted Precious Metal Consignments; and (ii) the Master
         Copper Lease Agreement, dated February 17, 2000, between Lessee and FP
         Commodity Master Trust, by its Administrative Agent, Canadian Imperial
         Bank of Commerce, and only so long as the value, in United States
         Dollars, of the metals subject to said Master Copper Lease Agreement
         does not exceed an amount greater than $15,000,000 in the aggregate.

         (o) INDEBTEDNESS. None of the Parent, Lessee or any of the Subsidiaries
will contract, create, incur, assume or suffer to exist any Indebtedness of the
Parent, Lessee or any of the Subsidiaries, EXCEPT:

                  (a) LEASE DOCUMENTS: Indebtedness incurred under this
         Agreement, the Credit Agreement and the other Lease Documents;

                  (b) EXISTING INDEBTEDNESS: Existing Indebtedness; and any
         refinancing, extension, renewal or refunding of any such Existing
         Indebtedness not involving an increase in the principal amount thereof
         and, if involving a maturity date prior to the Maturity Date or
         shortening the maturity date to a date prior to the Maturity Date, not
         involving a reduction of more than 10% in the remaining weighted
         average life to maturity thereof (computed in accordance with standard
         financial practice);

                  (c) CERTAIN PRIORITY DEBT: to the extent not permitted by the
         foregoing clauses,

                           (i) Indebtedness consisting of Capital Lease
                  Obligations of the Parent, Lessee and the Subsidiaries,

                           (ii) Indebtedness consisting of obligations under
                  Synthetic Leases of the Parent or Lessee and any Subsidiary,

                           (iii) Indebtedness of the Parent, Lessee and the
                  Subsidiaries secured by a Lien referred to in Paragraph (n)(c)
                  above,

                           (iv) Indebtedness of Foreign Subsidiaries, and

                                    Page 12
<PAGE>   13

                           (v) any refinancing, extension, renewal or refunding
                  of any such Indebtedness not involving an increase in the
                  principal amount thereof or a reduction of more than 10% in
                  the remaining weighted average life to maturity thereof
                  (computed in accordance with standard financial practice),

         PROVIDED that (A) at the time of any incurrence thereof after the date
         hereof, and after giving effect thereto, the Parent and Lessee would be
         in compliance with Paragraph (m)(e) above and Section XXIII, and no
         Potential Default under Section XI(a)(i) or Default shall have occurred
         and be continuing or would result therefrom; and (B) the aggregate
         outstanding principal amount (using Capitalized Lease Obligations in
         lieu of principal amount, in the case of any Capital Lease, and using
         the present value, based on the implicit interest rate, in lieu of
         principal amount, in the case of any Synthetic Lease) of Indebtedness
         permitted by this clause (c), shall not exceed with respect to the
         Parent, Lessee and the Subsidiaries on a consolidated basis,
         $10,000,000;

                  (d) INTERCOMPANY DEBT: unsecured Indebtedness of any of the
         Subsidiaries to the Parent or Lessee or to a Wholly-Owned Subsidiary of
         the Parent or Lessee;

                  (e) HEDGE AGREEMENTS: Indebtedness of the Parent, Lessee and
         the Subsidiaries under Hedge Agreements that comply with Paragraph (i)
         above;

                  (f) GUARANTY OBLIGATIONS: any Guaranty Obligations permitted
         by Paragraph (p) below;

                  (g) CONSIGNMENT OBLIGATIONS: obligations of Lessee and
         Subsidiaries of the Parent in respect of Permitted Precious Metal
         Consignments;

                  (h) TAKE OR PAY CONTRACT IN KAZAKHSTAN: Indebtedness incurred
         by Lessee in connection with a take or pay arrangement for beryllium
         mined in Kazakhstan pursuant to the Sale and Purchase Agreement, dated
         as of December 21, 1999, among Lessee, Kazatomprom, Ulba Metallurgical
         Plant, and NUKEM, Inc., as amended by an amendment that Lessee expects
         to enter into after the Closing Date, provided that such amendment and
         any related documents are approved by the Lessor, which approval will
         not be unreasonably withheld, and that any Indebtedness arising in
         connection therewith, determined in U.S. Dollars, does not in the
         aggregate exceed $9,000,000 during any twelve month period;

                  (i) MEDIUM TERM NOTES: Indebtedness incurred by Lessee under
         any Medium-Term Notes issued pursuant to the Issuing and Paying Agency
         Agreement, dated as of February 1, 1990, between Lessee and Morgan
         Guaranty Trust Company of New York or its successor in interest, as
         amended or modified from time to time, not in excess of $10,000,000
         aggregate principal amount outstanding at any time without the prior
         written consent of the Lessor, PROVIDED that at the time of incurrence
         thereof, and after giving effect thereto, (i) Lessee would be in
         compliance with Section XXIII; and (ii) no Potential Default under
         Section XI(a)(i) or Default shall have occurred and be continuing or
         would result therefrom; and

                  (j) ADDITIONAL UNSECURED DEBT OF THE PARENT AND LESSEE:
         additional unsecured Indebtedness of the Parent and Lessee, not in
         excess of $5,000,000 aggregate principal amount outstanding at any
         time, PROVIDED that at the time of incurrence thereof, and after giving
         effect

                                    Page 13
<PAGE>   14

         thereto, (i) the Parent and Lessee would be in compliance with Section
         XXIII; and (ii) no Potential Default under Section XI(a)(i) or Default
         shall have occurred and be continuing or would result therefrom.

         (p) ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS. None of the
Parent, Lessee or any of the Subsidiaries will (1) lend money or credit or make
advances to any person, (2) purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to, or
other investment in, any person, (3) create, acquire or hold any Subsidiary, (4)
be or become a party to any joint venture, member of a limited liability company
or partner of a partnership, or (5) be or become obligated under any Guaranty
Obligations (other than those created in favor of the Participants pursuant to
the Lease Documents), EXCEPT:

                  (a) the Parent, Lessee or any of the Subsidiaries may invest
         in cash and Cash Equivalents;

                  (b) any endorsement of a check or other medium of payment for
         deposit or collection, or any similar transaction in the normal course
         of business;

                  (c) the Parent, Lessee and the Subsidiaries may acquire and
         hold receivables owing to them in the ordinary course of business and
         payable or dischargeable in accordance with customary trade terms
         (including receivables evidenced by a promissory note executed after
         the account debtor in question fails to make payments when due and
         including the acceptance of notes by Brush Wellman (Japan) Ltd. in
         respect of its receivables in the normal course of its business and
         consistent with its past practice );

                  (d) loans and advances to employees for business-related
         travel expenses, moving expenses, costs of replacement homes, business
         machines or supplies, automobiles and other similar expenses, in each
         case incurred in the ordinary course of business and consistent with
         past practice;

                  (e) the existing loans, advances, investments and guarantees
         described in Annex V to the Credit Agreement on the Effective Date;

                  (f) investments of the Parent, Lessee and the Subsidiaries in
         Hedge Agreements that comply with Paragraph (i) above;

                  (g) existing investments in any Subsidiaries shall be
         permitted, and the creation and holding of any Wholly-Owned Subsidiary
         and any additional investments in any current or future Wholly-Owned
         Subsidiary, so long as the Parent and Lessee comply with Paragraph (k)
         above in connection with the creation of any Wholly-Owned Domestic
         Subsidiary;

                  (h) intercompany loans and advances permitted by Paragraph
         (o)(d) above;

                  (i) the Acquisitions permitted by Paragraph (m) above; and
         loans, advances and investments of any person which are outstanding at
         the time such person becomes a Subsidiary of the Parent or Lessee as a
         result of an Acquisition permitted by Paragraph (m) above and not
         created in contemplation thereof, but not any increase in the amount
         thereof;

                                    Page 14
<PAGE>   15

                  (j) any unsecured Guaranty Obligation incurred by the Parent,
         Lessee or any Subsidiary with respect to (i) Indebtedness of a
         Wholly-Owned Subsidiary of the Parent or Lessee which is permitted
         under Paragraph (o) above without restriction upon the ability of the
         Parent, Lessee or any Subsidiary to guarantee the same, or (ii) other
         obligations of a Wholly-Owned Subsidiary of the Parent or Lessee which
         are not prohibited by this Agreement;

                  (k) any other loans, advances, investments (whether in the
         form of cash or contribution of property, and if in the form of a
         contribution of property, such property shall be valued for purposes of
         this clause at the fair value thereof as reasonably determined by the
         Parent or Lessee), in or to any corporation, partnership, limited
         liability company, joint venture or other business entity, not
         otherwise permitted by the foregoing clauses, made after the date
         hereof (such loans, advances and investments, collectively, "BASKET
         INVESTMENTS"), PROVIDED that (i) at the time of making any such Basket
         Investment no Default or Potential Default shall have occurred and be
         continuing, or would result therefrom, and (ii) the maximum cumulative
         amount of Basket Investments which are so made and outstanding at any
         time, taking into account the repayment of any loans or advances
         comprising such Basket Investments, shall not, when taken together with
         the aggregate amount of all Guaranty Obligations of the Parent, Lessee
         and the Subsidiaries in respect of Indebtedness of persons other than
         Wholly-Owned Subsidiaries of the Parent or Lessee which are then
         outstanding, does not exceed $10,000,000 with respect to the Parent,
         Lessee and the Subsidiaries on a consolidated basis; and

                  (l) the Permitted Precious Metal Consignments.

         (q) DIVIDENDS, STOCK REPURCHASES, ETC. (a) The Parent will not directly
or indirectly declare, order, pay or make any dividend (other than dividends
payable solely in capital stock of the Parent) or other distribution on or in
respect of any capital stock of any class of the Parent, whether by reduction of
capital or otherwise, EXCEPT that the Parent may make cash dividend payments in
respect of its capital stock if (i) no Potential Default under Section XI(a)(i)
or Default shall have occurred and be continuing at the time of declaration or
payment thereof; and (ii) after giving effect thereto the Parent and Lessee will
be in compliance, on a PRO FORMA basis, with Section XXIII.

         (b) The Parent and Lessee will not directly or indirectly make, or
permit any of the Subsidiaries to directly or indirectly make, any purchase,
redemption, retirement or other acquisition of (x) any of their capital stock of
any class (other than for a consideration consisting solely of capital stock of
that person), or (y) any warrants, rights or options to acquire or any
securities convertible into or exchangeable for any of their capital stock,
EXCEPT that the Parent and Lessee may make cash payments for such purposes so
long as the moneys used for such purposes are not proceeds of any loans under
the Credit Agreement and if (i) no Potential Default under Section XI(a)(i) or
Default shall have occurred and be continuing at the time of payment; (ii) after
giving effect thereto the Parent and Lessee will be in compliance, on a PRO
FORMA basis, with Section XXIII; and (iii) at the time of making any such cash
payment and after giving effect thereto, the cumulative aggregate amount so
expended for such purposes subsequent to the Effective Date does not exceed
$10,000,000.

         (r) PREPAYMENTS AND REFINANCINGS OF OTHER DEBT, ETC. None of the
Parent, Lessee or any of the Subsidiaries will make (or give any notice in
respect thereof) any voluntary or optional payment or prepayment or redemption
or acquisition for value of (including, without limitation, by way of depositing
with the trustee with respect thereto money or securities before due for the
purpose of paying when due) or exchange of, or refinance or refund, any
Indebtedness of any of the Parent, Lessee or the Subsidiaries

                                    Page 15
<PAGE>   16

having an outstanding principal balance (or Capitalized Lease Obligation, in the
case of a Capital Lease, or present value, based on the implicit interest rate,
in the case of any Synthetic Lease) (other than the obligations under this
Agreement and intercompany loans and advances among the Parent, Lessee and the
Subsidiaries permitted by Paragraph (o)(d) above); PROVIDED that the Parent or
Lessee or any Subsidiary may refinance or refund any such Indebtedness not
involving an increase in the principal amount thereof and, if involving a
maturity date prior to the Maturity Date or shortening the maturity date to a
date prior to the Maturity Date, the aggregate principal amount thereof (or
Capitalized Lease Obligation, in the case of a Capital Lease, or present value,
based on the implicit interest rate, in the case of any Synthetic Lease) is not
increased and the weighted average life to maturity thereof (computed in
accordance with standard financial practice) is not reduced by more than 10%.

         (s) TRANSACTIONS WITH AFFILIATES. None of the Parent, Lessee and any
Subsidiary that is a Pledged Company will enter into any transaction or series
of transactions with any Affiliate (other than, in the case of the Parent or
Lessee, Lessee or the Parent or any Wholly-Owned Subsidiary that is a Pledged
Company, and in the case of a Subsidiary that is a Pledged Company, the Parent,
Lessee or another Wholly-Owned Subsidiary that is a Pledged Company) other than
pursuant to the reasonable requirements of the Parent's, Lessee's or such
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Parent, Lessee or such Subsidiary than would be obtained in a comparable
arm's-length transaction with a person other than an Affiliate, EXCEPT for the
transactions described in Annex VII to the Credit Agreement on the Effective
Date. No Subsidiary that is not a Pledged Company will enter into any
transaction or series of transactions with any Affiliate (other than the Parent,
Lessee or a Wholly-Owned Subsidiary) other than pursuant to the reasonable
requirements of such Subsidiary's business and upon fair and reasonable terms no
less favorable to such Subsidiary than would be obtained in a comparable
arm's-length transaction with a person other than an Affiliate, EXCEPT for the
transactions described in Annex VII to the Credit Agreement on the Effective
Date.

         (t) PLAN TERMINATIONS, MINIMUM FUNDING, ETC. None of the Parent, Lessee
or any ERISA Affiliate will (i) terminate any Plan or Plans so as to result in
liability of the Parent, Lessee or any ERISA Affiliate to the PBGC in excess of,
in the aggregate, the amount which is equal to $5,000,000 as of the date of the
then most recent financial statements furnished to Lessor and the Participants
pursuant to the provisions of this Agreement, (ii) permit to exist one or more
events or conditions which reasonably present a material risk of the termination
by the PBGC of any Plan or Plans with respect to which the Parent, Lessee or any
ERISA Affiliate would, in the event of such termination, incur liability to the
PBGC in excess of such amount in the aggregate, or (iii) fail to comply in any
material respect with the minimum funding standards of ERISA and the Code with
respect to any Plan.

         (u) CERTAIN LEASES. None of the Parent, Lessee or any of the
Subsidiaries will permit the aggregate payments (excluding any property taxes,
insurance or maintenance obligations paid by the Parent, Lessee and the
Subsidiaries as additional rent or lease payments) by the Parent, Lessee and the
Subsidiaries on a consolidated basis under agreements to rent or lease any real
or personal property for a period exceeding 12 months (including any renewal or
similar option periods) (other than any leases constituting Capital Leases,
Synthetic Leases or, subject to Paragraph (s) above, leases between the Parent
and Lessee, between Subsidiaries or between the Parent or Lessee and a
Subsidiary), to exceed in any fiscal year of the Parent an amount greater than
3.50% of the Consolidated Net Worth of the Parent and Lessee as of the date of
the financial statements then most recently furnished to Lessor and the
Participants under Section IV(b)(i).

         (v) LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS. None of the Parent,
Lessee or any of the Subsidiaries will directly or indirectly, enter into, incur
or permit to exist or become effective, any "negative

                                    Page 16
<PAGE>   17

pledge" covenant or other agreement, restriction or arrangement that prohibits,
restricts or imposes any condition upon (a) the ability of the Parent or Lessee
or any Subsidiary to create, incur or suffer to exist any Lien upon any of its
property or assets as security for Indebtedness, or (b) the ability of the
Parent or Lessee or any Subsidiary to pay dividends or make any other
distributions on its capital stock or any other interest or participation in its
profits owned by the Parent or Lessee or any Subsidiary of the Parent or Lessee,
or pay any Indebtedness owed to the Parent or Lessee or a Subsidiary of the
Parent or Lessee, or to make loans or advances to the Parent or Lessee or any
other Subsidiaries, or transfer any of its property or assets to the Parent or
Lessee or any other Subsidiaries, EXCEPT for such restrictions existing under or
by reason of (i) applicable law, (ii) this Agreement and the other Lease
Documents and the Credit Agreement, (iii) customary provisions restricting
subletting or assignment of any lease governing a leasehold interest, (iv)
customary provisions restricting assignment of any licensing agreement entered
into in the ordinary course of business, (v) customary provisions restricting
the transfer or further encumbering of assets subject to Liens permitted under
Paragraphs (n)(b), (n)(c) or (n)(d) above, (vi) customary restrictions affecting
only a Subsidiary of the Parent or Lessee under any agreement or instrument
governing any of the Indebtedness of a Subsidiary permitted pursuant to
Paragraph (o) above, excluding any restriction on dividends or distributions to
its stockholders (vii) restrictions affecting any Foreign Subsidiary of the
Parent or Lessee under any agreement or instrument governing any Indebtedness of
such Foreign Subsidiary permitted pursuant to Paragraph (o) above, and customary
restrictions contained in "comfort" letters and guarantees of any such
Indebtedness, excluding any restriction on dividends or distributions to its
stockholders (viii) any document relating to Indebtedness secured by a Lien
permitted by Paragraph (n) above, insofar as the provisions thereof limit grants
of junior liens on the assets securing such Indebtedness, and (ix) any operating
lease or Capital Lease, insofar as the provisions thereof limit grants of a
security interest in, or other assignments of, the related leasehold interest to
any other person.

                  1.08 Section XXV of the Lease Agreement shall be amended as
 follows:

                  (A) The following definitions shall be deleted: "Amendment
Effective Date"; "Accumulated Funding Deficiency"; "Contingent Obligation";
"EBIT"; "EBITDA"; "Eligible Investments"; "Funded Indebtedness" "Indebtedness
for Borrowed Money"; "Net Income"; "Pension Plan"; "Required Multiplier";
"Standard & Poor's"; and "Tangible Net Worth".

                  (B) The following definitions shall be amended by deleting the
same and inserting the following in lieu thereof the following definitions:

         COMPANY refers to Lessee or to the Parent, as the case may be, and
         their Subsidiaries and COMPANIES refers to the Parent, Lessee and the
         Subsidiaries;

         CREDIT AGREEMENT means the Credit Agreement, dated as of June 30, 2000,
         among Lessee, Parent, Lessor, in its capacity as Administrative Agent
         and as swing line lender, and the lending institutions party thereto,
         as the same may be amended, modified, restated or supplemented from
         time to time;

         ENVIRONMENTAL LAW shall mean any applicable Federal, state, foreign or
         local statute, law, rule, regulation, ordinance, code, binding and
         enforceable guideline, binding and enforceable written policy and rule
         of common law now or hereafter in effect and in each case as amended,
         and any binding and enforceable judicial or administrative
         interpretation thereof, including any judicial or administrative order,
         consent, decree or judgment issued to or rendered against the Parent,
         Lessee or any of the Subsidiaries relating to the environment, employee
         health and safety or Hazardous

                                    Page 17
<PAGE>   18

         Materials, including, without limitation, CERCLA; RCRA; the Federal
         Water Pollution Control Act, 33 U.S.C. Section 2601 ET SEQ.; the Clean
         Air Act, 42 U.S.C. Section 7401 ET SEQ.; the Safe Drinking Water Act,
         42 U.S.C. Section 3803 ET SEQ.; the Oil Pollution Act of 1990, 33
         U.S.C. Section 2701 ET SEQ.; the Emergency Planning and the Community
         Right-to-Know Act of 1986, 42 U.S.C. Section 11001 ET SEQ., the
         Hazardous Material Transportation Act, 49 U.S.C. Section 1801 ET SEQ.
         and the Occupational Safety and Health Act, 29 U.S.C. Section 651 ET
         SEQ. (to the extent it regulates occupational exposure to Hazardous
         Materials); and any state and local or foreign counterparts or
         equivalents, in each case as amended from time to time (all terms
         pertaining to Environmental Laws not defined in this Agreement shall
         have the meanings ascribed thereto in the respective Environmental
         Laws);

         ERISA shall mean the Employee Retirement Income Security Act of 1974,
         as amended from time to time, and the regulations promulgated and
         rulings issued thereunder. Section references to ERISA are to ERISA, as
         in effect at the Effective Date and any subsequent provisions of ERISA,
         amendatory thereof, supplemental thereto or substituted therefor.

         GAAP shall mean generally accepted accounting principles in the United
         States of America as in effect from time to time; it being understood
         and agreed that determinations in accordance with GAAP for purposes of
         Sections XXIII and XXIV, including defined terms as used therein, are
         subject (to the extent provided therein) to the following: except as
         otherwise specifically provided herein, all terms of an accounting or
         financial nature shall be construed in accordance with GAAP, as in
         effect from time to time; PROVIDED that, if Lessee notifies Lessor that
         Lessee requests an amendment to any provision of Section XXIII or XXIV
         hereof to eliminate the effect of any change occurring after the
         Effective Date in GAAP or in the application thereof to such provision
         (or if Lessor notifies Lessee that Lessor requests an amendment to any
         such provision hereof for such purposes), regardless of whether any
         such notice is given before or after such change in GAAP or in the
         application thereof, then such provision shall be interpreted on the
         basis of GAAP as in effect and applied immediately before such change
         shall have become effective until such notice shall have been withdrawn
         or such provision amended in accordance with the requirements of this
         Agreement;

         GUARANTY means the Guaranty Agreement, dated as of May 16, 2000, by the
         Parent in favor of Lessor, as the same may be amended, restated,
         modified or supplemented from time to time;

         MAXIMUM ACQUISITION Cost means with respect to the aggregate
         Acquisition Cost of the Equipment under all of the Schedules,
         $55,500,000;

         PARENT means Brush Engineered Materials Inc., an Ohio corporation and
         its successors and assigns;

         PORT AUTHORITY BONDS means the Toledo-Lucas County Port Authority
         Taxable Project Development Revenue Bonds, Series 1996 (Brush Wellman
         Inc. Project) in the principal amount of $13,100,000, and the
         Toledo-Lucas County Port Authority Taxable Project Development Revenue
         Bonds, Series 1997 (Brush Wellman Inc. Project) in the principal amount
         of $2,175,000, both of which were issued, sold and delivered by the
         Toledo-Lucas County Port Authority to The Prudential Insurance Company
         of America;

         PORT AUTHORITY LEASE means the Lease, dated as of October 1, 1996,
         between the Toledo-Lucas County Port Authority, as lessor, and Lessee,
         as lessee, as amended by the First Supplemental Lease, dated as of
         April 1, 1997, between National City Bank, as trustee, as lessor (as
         assignee of

                                    Page 18
<PAGE>   19

         all of the lessor's rights from the Toledo-Lucas County Port
         Authority), relating to certain real and personal property located at
         14710 West Portage River S. Road, Harris Township, Ohio 43416;

         REPORTABLE EVENT shall mean an event described in section 4043 of ERISA
         or the regulations thereunder with respect to a Plan, other than those
         events as to which the notice requirement is waived under the PBGC
         Regulations;

         SUBSIDIARY of any person shall mean and include (i) any corporation
         more than 50% of whose stock of any class or classes having by the
         terms thereof ordinary voting power to elect a majority of the
         directors of such corporation (irrespective of whether or not at the
         time stock of any class or classes of such corporation shall have or
         might have voting power by reason of the happening of any contingency)
         is at the time owned by such person directly or indirectly through
         Subsidiaries and (ii) any partnership, association, joint venture or
         other entity in which such person directly or indirectly through
         Subsidiaries, has more than a 50% equity interest at the time. Unless
         otherwise expressly provided, all references herein to "Subsidiary"
         shall mean a Subsidiary of the Parent and/or Lessee;

         SYNTHETIC LEASE shall mean any lease (i) which is accounted for by the
         lessee as an Operating Lease, and (ii) under which the lessee is
         intended to be the "owner" of the leased property for Federal income
         tax purposes, including, without limitation, this Agreement;"

                  (C) The following definitions shall be inserted in proper
alphabetical order:

         ACQUISITION shall mean and include (i) any acquisition on a going
concern basis (whether by purchase, lease or otherwise) of any facility and/or
business operated by any person who is not a Subsidiary of the Parent or Lessee,
and (ii) acquisitions of a majority of the outstanding equity or other similar
interests in any such person (whether by merger, stock purchase or otherwise).

         AFFILIATE shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
by reason of such status, be considered an Affiliate of such person; and (y)
neither Lessor nor any Participant shall in any event be considered an Affiliate
of the Parent, Lessee or any of the Subsidiaries.

         ASSET SALE shall mean the sale, transfer or other disposition
(including by means of Sale and Lease-Back Transactions, and by means of
mergers, consolidations, and liquidations of a corporation, partnership or
limited liability company of the interests therein of the Parent, Lessee or any
Subsidiary) by the Parent, Lessee or any Subsidiary to any person of any of
their respective assets, but excluding the sale, transfer or other disposition
of the Equipment.

         AUTHORIZED OFFICER shall mean any officer or employee of Lessee
designated as such in writing to Lessor by Lessee.

                                    Page 19
<PAGE>   20

         CAPITAL LEASE as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that person.

         CAPITALIZED LEASE OBLIGATIONS shall mean all obligations under Capital
Leases of the Parent, Lessee or any of the Subsidiaries in each case taken at
the amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Parent, Lessee and the Subsidiaries prepared in accordance with GAAP.

         CASH EQUIVALENTS shall mean any of the following:

                  (i) securities issued or directly and fully guaranteed or
         insured by the United States of America or any agency or
         instrumentality thereof (PROVIDED that the full faith and credit of the
         United States of America is pledged in support thereof) having
         maturities of not more than one year from the date of acquisition;

                  (ii) U.S. dollar denominated time deposits, certificates of
         deposit and bankers' acceptances of (x) Lessor or any Participant or
         (y) any bank whose short-term commercial paper rating from S&P is at
         least A-1 or the equivalent thereof or from Moody's is at least P-1 or
         the equivalent thereof (any such bank, an "APPROVED BANK"), in each
         case with maturities of not more than 180 days from the date of
         acquisition;

                  (iii) commercial paper issued by Lessor or any Participant or
         Approved Bank or by the parent company of Lessor or any Participant or
         Approved Bank maturing within 270 days of the date of acquisition,
         commercial paper issued by, or guaranteed by, any industrial or
         financial company, having a short-term commercial paper rating of at
         least A-1 or the equivalent thereof by S&P or at least P-1 or the
         equivalent thereof by Moody's, or guaranteed by any industrial company
         with a long term unsecured debt rating of at least A or A2, or the
         equivalent of each thereof, from S&P or Moody's, as the case may be,
         and in each case maturing within 270 days after the date of
         acquisition;

                  (iv) investments in money market funds or mutual funds
         substantially all the assets of which are comprised of securities of
         the types described in clauses (i) through (iii) above and (v) below;
         and

                  (v) obligations issued or guaranteed by any state or political
         subdivision thereof and rated at least A-1 or the equivalent thereof by
         S&P or at least P-1 or the equivalent thereof by Moody's (if rated as
         short-term obligations) or with a long term unsecured debt rating of at
         least A or A2, or the equivalent of each thereof, from S&P or Moody's,
         as the case may (if rated as long-term obligations).

         CASH PROCEEDS shall mean, with respect to any Asset Sale, the aggregate
cash payments (including any cash received by way of deferred payment pursuant
to a note receivable issued in connection with such Asset Sale, other than the
portion of such deferred payment constituting interest, but only as and when so
received) received by the Parent, Lessee and/or any Subsidiary from such Asset
Sale.

         CERCLA shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. Section 9601 ET SEQ.

                                    Page 20
<PAGE>   21

         CHANGE OF CONTROL shall mean and include any of the following:

                  (i) during any period of two consecutive calendar years,
         individuals who at the beginning of such period constituted the
         Parent's Board of Directors (together with any new directors (x) whose
         election by the Parent's Board of Directors was, or (y) whose
         nomination for election by the Parent's shareholders was (prior to the
         date of the proxy or consent solicitation relating to such nomination),
         approved by a vote of at least two-thirds of the directors then still
         in office who either were directors at the beginning of such period or
         whose election or nomination for election was previously so approved),
         shall cease for any reason to constitute a majority of the directors
         then in office;

                  (ii) any person other than the Parent shall own all of the
         issued and outstanding capital stock of Lessee, or any person or group
         (as such term is defined in section 13(d)(3) of the 1934 Act), other
         than the Parent, Lessee, any trustee or other fiduciary holding
         securities under an employee benefit plan of the Parent, or any members
         of the Current Holder Group, shall acquire, directly or indirectly,
         beneficial ownership (within the meaning of Rule 13d-3 and 13d-5 of the
         1934 Act) of more than 20%, on a fully diluted basis, of the economic
         or voting interest in the Parent's capital stock;

                  (iii) the shareholders of the Parent or Lessee approve a
         merger or consolidation by it with any other person, OTHER than a
         merger or consolidation which would result in the voting securities of
         the Parent or Lessee, as the case may be, outstanding immediately prior
         thereto continuing to represent (either by remaining outstanding or by
         being converted or exchanged for voting securities of the surviving or
         resulting entity) more than 50% of the combined voting power of the
         voting securities of that person or such surviving or resulting entity
         outstanding after such merger or consolidation;

                  (iv) the shareholders of the Parent or Lessee approve a plan
         of complete liquidation for that person or an agreement or agreements
         for the sale or disposition by that person of all or substantially all
         of its assets; and/or

                  (v) any "change in control" or any similar term as defined in
         any indenture, credit agreement, note or securities purchase agreement,
         or other agreement or instrument governing any Indebtedness, with
         respect to Indebtedness of the Parent or Lessee that has an unpaid
         principal amount of $25,000 or greater;

As used in this definition, the term "CURRENT HOLDER GROUP" shall mean (i) those
persons, if any, who as of the Effective Date have disclosed in filings with the
SEC their beneficial ownership of more than 5% of the outstanding shares of
capital stock of the Parent, (ii) those other persons who are officers and
directors of the Parent and Lessee at the Effective Date, (iii) the spouses,
heirs, legatees, descendants and blood relatives to the third degree of
consanguinity of any such person, (iv) the executors and administrators of the
estate of any such person, and any court appointed guardian of any such person,
and (v) any trust, family partnership or similar investment entity for the
benefit of any such person referred to in the foregoing clauses (i), (ii) and
(iii) or any other persons (including for charitable purposes), so long as one
or more members of the Current Holder Group has the exclusive or a joint right
to control the voting and disposition of securities held by such trust, family
partnership or other investment entity;

         CODE shall mean the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated thereunder. Section references to the
Code are to the Code, as in effect at the

                                    Page 21
<PAGE>   22

Effective Date and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor;

         COMMODITY HEDGE AGREEMENT shall mean any commodity swap agreement,
forward commodity purchase agreement, forward commodity option agreement or
similar agreement or arrangement;

         CONSOLIDATED AMORTIZATION EXPENSE shall mean, for any period, all
amortization expenses of the Parent, Lessee and the Subsidiaries, all as
determined for the Parent, Lessee and the Subsidiaries on a consolidated basis
in accordance with GAAP;

         CONSOLIDATED CAPITAL EXPENDITURES shall mean, for any period, the
aggregate of all expenditures for property, plant or equipment (whether paid in
cash or accrued as liabilities and including in all events amounts expended or
capitalized under Capital Leases and Synthetic Leases but excluding any amount
representing capitalized interest) by the Parent, Lessee and the Subsidiaries
during that period;

         CONSOLIDATED DEPLETION EXPENSE shall mean, for any period, all
depletion expenses of the Parent, Lessee and the Subsidiaries, all as determined
for the Parent, Lessee and the Subsidiaries on a consolidated basis in
accordance with GAAP;

         CONSOLIDATED DEPRECIATION EXPENSE shall mean, for any period, all
depreciation expenses of the Parent, Lessee and the Subsidiaries, all as
determined for the Parent, Lessee and the Subsidiaries on a consolidated basis
in accordance with GAAP;

         CONSOLIDATED EBIT shall mean, for any period, Consolidated Net Income
for such period; PLUS (A) the sum (without duplication) of the amounts for such
period included in determining such Consolidated Net Income of (i) Consolidated
Interest Expense, (ii) Consolidated Income Tax Expense, and (iii) extraordinary
and other non-recurring non-cash losses and charges; minus (B) extraordinary
gains on sales of assets and other extraordinary or other non-recurring gains;
all as determined for the Parent, Lessee and the Subsidiaries on a consolidated
basis in accordance with GAAP;

         Notwithstanding anything to the contrary contained herein, the
Consolidated EBIT for any Testing Period shall (x) include the appropriate
financial items for any person or business unit which has been acquired by the
Parent, Lessee or any Subsidiary for any portion of such Testing Period prior to
the date of acquisition, and (y) exclude the appropriate financial items for any
person or business unit which has been disposed of by the Parent, Lessee or any
Subsidiary, for the portion of such Testing Period prior to the date of
disposition.

         CONSOLIDATED EBITDA shall mean, for any period, Consolidated EBIT for
such period; PLUS the sum (without duplication) of the amounts for such period
included in determining Consolidated Net Income of Consolidated Depreciation
Expense, Consolidated Amortization Expense and Consolidated Depletion Expense,
all as determined for the Parent, Lessee and the Subsidiaries on a consolidated
basis in accordance with GAAP;

         Notwithstanding anything to the contrary contained herein, the
Consolidated EBITDA for any Testing Period shall (x) include the appropriate
financial items for any person or business unit which has been acquired by the
Parent, Lessee or any Subsidiary for any portion of such Testing Period prior to
the date of acquisition, and (y) exclude the appropriate financial items for any
person or business unit which has been disposed of by the Parent, Lessee or any
Subsidiary, for the portion of such Testing Period prior to the date of
disposition.

                                    Page 22
<PAGE>   23

         CONSOLIDATED EBITDAR shall mean, for any period, Consolidated EBITDA
for such period; PLUS the sum (without duplication) of the amounts for such
period included in determining Consolidated Net Income of Consolidated Rental
Expense, all as determined for the Parent, Lessee and the Subsidiaries on a
consolidated basis in accordance with GAAP;

         CONSOLIDATED FIXED CHARGE COVERAGE RATIO means, for any Testing Period,
the ratio of (a) Consolidated EBITDA for that Testing Period to (b) the sum of
(i) Consolidated Interest Expense and Consolidated Income Tax Expense for that
Testing Period, plus (ii) scheduled or mandatory repayments, prepayments or
redemptions during that Testing Period of the principal of Indebtedness
(including Capitalized Lease Obligations and required reductions in committed
credit facilities) with a final maturity date more than one year after the end
of that Testing Period, plus (iii) the sum of all payments for dividends, stock
repurchases or other stock redemptions, and other purposes described in Section
XXIV(q), if any, in each case on a consolidated basis for the Parent, Lessee and
the Subsidiaries for such Testing Period; PROVIDED that, notwithstanding
anything to the contrary contained herein, the Consolidated Fixed Charge
Coverage Ratio for any Testing Period shall (x) include the appropriate
financial items for any person or business unit which has been acquired by the
Parent, Lessee or any Subsidiary for any portion of such Testing Period prior to
the date of acquisition, and (y) exclude the appropriate financial items for any
person or business unit which has been disposed of by the Parent, Lessee or any
Subsidiary, for the portion of such Testing Period prior to the date of
disposition;

         CONSOLIDATED INCOME TAX EXPENSE shall mean, for any period, all
provisions for taxes based on the net income of the Parent, Lessee and the
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Parent, Lessee and the Subsidiaries on a consolidated basis in accordance with
GAAP;

         CONSOLIDATED INTEREST EXPENSE shall mean, for any period, total
interest expense (including that which is capitalized, that which is
attributable to Capital Leases (but not to Synthetic Leases) and the pre-tax
equivalent of dividends payable on Redeemable Stock) of the Parent, Lessee and
the Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Parent, Lessee and the Subsidiaries, including, without
limitation, all commissions, discounts and other fees and charges owed with
respect to letters of credit and net obligations under Financial Hedge
Agreements (except for Financial Hedge Agreements described in clause (ii) of
the definition thereof), BUT EXCLUDING, HOWEVER, any interest expense in respect
of Permitted Precious Metal Consignments, any amortization or write-off of
deferred financing costs and any charges for prepayment penalties on prepayment
of Indebtedness;

         CONSOLIDATED NET INCOME shall mean for any period, the net income (or
loss) of the Parent, Lessee and the Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP;

         CONSOLIDATED NET WORTH shall mean at any time for the determination
thereof: (i) all amounts which, in conformity with GAAP, would be included under
the caption "total stockholders' equity" (or any like caption) on a consolidated
balance sheet of the Parent, Lessee and the Subsidiaries as at such date (I.E.,
the sum of the entries for (1) the par or stated value of common stock and
preferred stock (but excluding treasury stock and capital stock subscribed and
unissued), (2) paid-in capital and (3) retained earnings (or deficit)), MINUS
(ii) to the extent included in clause (i), all amounts properly attributable to
minority interests, if any, in the stock or other equity of Subsidiaries;
PROVIDED that in no event shall Consolidated Net Worth include any amounts in
respect of Redeemable Stock;

                                    Page 23
<PAGE>   24

         CONSOLIDATED RENTAL EXPENSE shall mean, for any period, total rental
expense for all Synthetic Leases, including the interest portion of all
Synthetic Leases, of the Parent, Lessee and the Subsidiaries, all as determined
for the Parent, Lessee and the Subsidiaries on a consolidated basis.

         CONSOLIDATED TANGIBLE NET WORTH shall mean at any time for the
determination thereof: (i) the Consolidated Net Worth of the Parent, Lessee and
the Subsidiaries as at such date, MINUS the aggregate amount of goodwill and
intangible assets of the Parent, Lessee and the Subsidiaries as at such date, as
determined in accordance with GAAP;

         CONSOLIDATED TOTAL ADJUSTED CAPITAL shall mean at any time (i)
Consolidated Total Debt at such time; PLUS (ii) Consolidated Tangible Net Worth
as of the end of the most recent fiscal quarter for which the Parent's and
Lessee's consolidated financial statements have been furnished to Lessor and the
Participants under this Agreement; PLUS (iii) to the extent deducted in
determining Consolidated Net Worth for purposes of determining Consolidated
Tangible Net Worth, all amounts properly attributable to minority interests, if
any, in the stock or other equity of Subsidiaries;

         CONSOLIDATED TOTAL DEBT shall mean, at any time, the sum (without
duplication) of the principal amount (or Capitalized Lease Obligation, in the
case of a Capital Lease, or present value, based on the implicit interest rate,
in the case of any Synthetic Lease, or the higher of liquidation value or stated
value, in the case of Redeemable Stock) of all Indebtedness of the Parent,
Lessee and of the Subsidiaries, without duplication, all as determined on a
consolidated basis, PROVIDED that for purposes of this definition none of the
following obligations shall be considered in determining Consolidated Total
Debt: obligations under (i) Hedge Agreements, (ii) Permitted Precious Metal
Consignments, (iii) the Gold-denominated loan under the Master Precious Metal
Transaction Agreement, dated March 10, 1993, among Lessee, Williams Advanced
Materials Inc., one of its subsidiaries, Technical Materials Inc. and Canadian
Imperial Bank of Commerce to the extent that the payment obligations of Lessee
thereunder do not exceed payments in respect of 23,781 ounces of gold, and (iv)
the obligations of Lessee in respect of the agreement described in Section
XXIV(o)(h) to the extent that those obligations do not exceed $6,000,000 during
any twelve month period;

         DOLLARS, U.S. DOLLARS, DOLLARS and the sign "$" each means lawful money
of the United States;

         DOMESTIC SUBSIDIARY shall mean any Subsidiary organized under the laws
of the United States of America, any State thereof, the District of Columbia, or
any United States possession, the chief executive office and principal place of
business of which is located in, and which conducts the majority of its business
within, the United States of America and its territories and possessions;

         EFFECTIVE DATE shall mean the date on which the conditions set forth in
Article II of the Consolidated Amendment No. 1 to Master Lease Agreement and
Equipment Schedules, dated as of June 30, 2000, between Lessee and Lessor are
satisfied;

         ENVIRONMENTAL CLAIMS shall mean any and all administrative, regulatory
or judicial actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violation, investigations or proceedings relating in any way
to any Environmental Law or any permit issued under any such law (hereafter
"CLAIMS"), including, without limitation, (i) any and all Claims by governmental
or regulatory authorities for enforcement, cleanup, removal, response, remedial
or other actions or damages pursuant to any applicable Environmental Law, and
(ii) any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
the storage, treatment or Release (as defined in CERCLA) of any Hazardous
Materials or arising from alleged injury or threat of injury to health, safety
or the environment;

                                    Page 24
<PAGE>   25

         ERISA AFFILIATE shall mean each person (as defined in section 3(9) of
ERISA) which together with the Parent, Lessee or any Subsidiary would be deemed
to be a "single employer" (i) within the meaning of section 414(b),(c), (m) or
(o) of the Code or (ii) as a result of the Parent's, Lessee's or that
Subsidiary's being or having been a general partner of such person;

         EXISTING INDEBTEDNESS shall have the meaning provided in section 7.18
of the Credit Agreement as in effect on the Effective Date;

         EXISTING INDEBTEDNESS AGREEMENTS shall have the meaning provided in
section 7.18 of the Credit Agreement as in effect on the Effective Date;

         FINANCIAL HEDGE AGREEMENT shall mean (i) any interest rate swap
agreement, any interest rate cap agreement, any interest rate collar agreement
or other similar agreement or arrangement; and (ii) any currency swap agreement,
forward currency purchase agreement or similar agreement or arrangement;

         FOREIGN SUBSIDIARY shall mean any Subsidiary that is not a Domestic
Subsidiary;

         GENERAL PERMITTED LIENS shall mean Liens described in Section XXIV(n);

         GUARANTY OBLIGATIONS shall mean as to any person (without duplication)
any obligation of such person guaranteeing any Indebtedness ("PRIMARY
INDEBTEDNESS") of any other person (the "PRIMARY OBLIGOR") in any manner,
whether directly or indirectly, including, without limitation, any obligation of
such person, whether or not contingent, (a) to purchase any such primary
Indebtedness or any property constituting direct or indirect security therefor,
(b) to advance or supply funds (i) for the purchase or payment of any such
primary Indebtedness or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof, PROVIDED, HOWEVER, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary Indebtedness in respect of which such Guaranty Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such person is required to perform
thereunder) as determined by such person in good faith;

         HAZARDOUS MATERIALS shall mean (i) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; and (ii) any chemicals, materials or substances defined as or
included in the definition of "hazardous substances", "hazardous wastes",
"hazardous materials", "restricted hazardous materials", "extremely hazardous
wastes", "restrictive hazardous wastes", "toxic substances", "toxic pollutants",
"contaminants" or "pollutants", or words of similar meaning and regulatory
effect, under any applicable Environmental Law;

         HEDGE AGREEMENT shall mean any Commodity Hedge Agreement and any
Financial Hedge Agreement;

                                    Page 25
<PAGE>   26

         INDEBTEDNESS of any person shall mean without duplication:

                  (i) all indebtedness of such person for borrowed money;

                  (ii) all bonds, notes, debentures and similar debt securities
         of such person;

                  (iii) the deferred purchase price of capital assets or
         services which in accordance with GAAP would be shown on the liability
         side of the balance sheet of such person;

                  (iv) the face amount of all letters of credit issued for the
         account of such person and, without duplication, all drafts drawn
         thereunder;

                  (v) all obligations, contingent or otherwise, of such person
         in respect of bankers' acceptances;

                  (vi) all Indebtedness of a second person secured by any Lien
         on any property owned by such first person, whether or not such
         Indebtedness has been assumed;

                  (vii) all Capitalized Lease Obligations of such person;

                  (viii) the present value, determined on the basis of the
         implicit interest rate, of all basic rental obligations under all
         Synthetic Leases of such person;

                  (ix) all obligations of such person to pay a specified
         purchase price for goods or services whether or not delivered or
         accepted, I.E., take-or-pay and similar obligations;

                  (x) all net obligations of such person under Hedge Agreements;

                  (xi) the full outstanding balance of trade receivables, notes
         or other instruments sold with full recourse (and the portion thereof
         subject to potential recourse, if sold with limited recourse), other
         than in any such case any thereof sold solely for purposes of
         collection of delinquent accounts;

                  (xii) the stated value, or liquidation value if higher, of all
         Redeemable Stock of such person; and

                  (xiii) all Guaranty Obligations of such person;

PROVIDED that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same) that are no more than forty-five days delinquent, shall
constitute Indebtedness; and (y) the Indebtedness of any person shall in any
event include (without duplication) the Indebtedness of any other entity
(including any general partnership in which such person is a general partner) to
the extent such person is liable thereon as a result of such person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide expressly that such person is not liable
thereon.

         LEASE DOCUMENTS shall mean this Agreement, any Security Documents and
the Schedules;

                                    Page 26
<PAGE>   27

         LEASE PARTY shall mean each of the Parent, Lessee and any other person
that is a party to any of the Lease Documents;

         LEASEHOLDS of any person means all the right, title and interest of
such person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures;

         MATERIAL ADVERSE EFFECT shall mean any or all of the following: (i) any
material adverse effect on the business, operations, property, prospects,
assets, liabilities or condition (financial or otherwise) of, when used with
reference to the Parent, Lessee and/or any of the Subsidiaries, the Parent,
Lessee and the Subsidiaries, taken as a whole, or when used with reference to
any other person, such person and its Subsidiaries, taken as a whole, as the
case may be; (ii) any material adverse effect on the ability of each of the
Lease Parties to perform its obligations under the Lease Documents to which it
is a party; (iii) any material adverse effect on the ability of the Parent,
Lessee and the Subsidiaries, taken as a whole, to pay their liabilities and
obligations as they mature or become due; or (iv) any material adverse effect on
the validity, effectiveness or enforceability, as against any Lease Party, of
any of the Lease Documents to which it is a party;

         MATERIAL SUBSIDIARY shall mean, at any time, with reference to any
person, any Subsidiary of such person (i) that has assets at such time
comprising 5% or more of the consolidated assets of such person and the
Subsidiaries, or (ii) whose operations in the current fiscal year are expected
to, or whose operations in the most recent fiscal year did (or would have if
such person had been a Subsidiary for such entire fiscal year), represent 5% or
more of the consolidated earnings before interest, taxes, depreciation and
amortization of such person and the Subsidiaries for such fiscal year. In
addition, Material Subsidiary shall include any Subsidiary as to which any part
of the capital stock thereof is pledged or is required to be pledged to Lessor,
as collateral agent, under the Pledge Agreement;

         MATURITY DATE shall mean the Maturity Date as that term is defined in
the Credit Agreement;

         MULTIEMPLOYER PLAN shall mean a multiemployer plan, as defined in
section 4001(a)(3) of ERISA to which the Parent, Lessee or any ERISA Affiliate
is making or accruing an obligation to make contributions or has within any of
the preceding five plan years made or accrued an obligation to make
contributions;

         MULTIPLE EMPLOYER PLAN shall mean an employee benefit plan, other than
a Multiemployer Plan, to which the Parent, Lessee or any ERISA Affiliate, and
one or more employers other than the Parent, Lessee or an ERISA Affiliate, is
making or accruing an obligation to make contributions or, in the event that any
such plan has been terminated, to which the Parent, Lessee or an ERISA Affiliate
made or accrued an obligation to make contributions during any of the five plan
years preceding the date of termination of such plan;

         NET CASH PROCEEDS shall mean, with respect to any Asset Sale, the Cash
Proceeds resulting therefrom net of (i) reasonable and customary expenses of
sale incurred in connection with such Asset Sale, and other reasonable and
customary fees and expenses incurred, and all state, and local taxes paid or
reasonably estimated to be payable by such person, as a consequence of such
Asset Sale and the payment of principal, premium and interest of Indebtedness
secured by the asset which is the subject of the Asset Sale and required to be,
and which is, repaid under the terms thereof as a result of such Asset Sale,
(ii) amounts of any distributions payable to holders of minority interests in
the relevant person or in the relevant property or assets and (iii) incremental
income taxes paid or payable as a result thereof;

                                    Page 27
<PAGE>   28

         OPERATING LEASE as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is not accounted for as a Capital Lease on the balance
sheet of that person;

         PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to section 4002 of ERISA, or any successor thereto;

         PERMITTED ACQUISITION shall mean and include any Acquisition as to
which all of the following conditions are satisfied:

                  (i) such Acquisition involves a line or lines of business
         which is complementary to the lines of business in which the Parent,
         Lessee or a Subsidiary, as the case may be, making the Acquisition is
         engaged on the Effective Date, UNLESS Lessor specifically approve or
         consent to such Acquisition in writing;

                  (ii) such Acquisition is not actively opposed by the Board of
         Directors (or similar governing body) of the selling person or the
         person whose equity interests are to be acquired, UNLESS Lessor and all
         of the Participants specifically approve or consent to such Acquisition
         in writing;

                  (iii) if as a result of an Acquisition a person becomes a
         Subsidiary of the Parent or Lessee, such Subsidiary shall be a
         Wholly-Owned Subsidiary;

                  (iv) the aggregate consideration for such Acquisition and all
         other Permitted Acquisitions completed in within the preceding 12 month
         period, including the principal amount of any assumed Indebtedness and
         (without duplication) any Indebtedness of any acquired person or
         persons, does not exceed $25,000,000, UNLESS Lessor specifically
         approves or consents to such Acquisition, such approval or consent not
         to be unreasonably withheld; PROVIDED that no such approval or consent
         shall be effective to permit an Acquisition which would result in such
         aggregate consideration exceeding $30,000,000 unless Lessor and all of
         the Participants join in such consent or approval; and

                  (v) the Parent and Lessee would, after giving effect to such
         Acquisition, be in compliance, on a PRO FORMA basis, with the financial
         covenants contained in Section XXIII (which compliance shall be
         evidenced by the execution and delivery of a PRO FORMA compliance
         covenant certificate by Lessee to Lessor at least fourteen days prior
         to the closing of the Permitted Acquisition), such PRO FORMA ratios
         being determined:

                           (A) as if (x) such Acquisition had been completed at
                  the beginning of the most recent period of four consecutive
                  fiscal quarters of the Parent and Lessee for which financial
                  information for the Parent and Lessee and the business or
                  person to be acquired, is available, and (y) any such
                  Indebtedness incurred to finance such Acquisition had been
                  outstanding for such period; and

                           (B) without giving effect to any credit for
                  unobtained or unrealized gains in connection with such
                  Acquisition, but taking into account such adjustments to the
                  overhead of such properties and assets as may reasonably be
                  determined and specified by Lessee to reflect the overhead
                  generally applicable to similar properties and assets owned by
                  the Parent, Lessee and the Subsidiaries, as and to the extent
                  Lessor determines (acting

                                    Page 28
<PAGE>   29

                  on instructions from the Required Participants) such
                  adjustments to be reasonable and appropriate under the
                  particular circumstances);

PROVIDED, that the term Permitted Acquisition specifically excludes any loans,
advances or minority investments otherwise permitted pursuant to section 9.5.

         PERMITTED PRECIOUS METAL CONSIGNMENTS shall mean precious metals
inventory of Lessee or any other Subsidiary that deals in precious metals that
is subject to any precious metal consignment arrangement described in Annex VI
of the Credit Agreement as in effect on the Effective Date (regardless of
whether styled as a lease, consignment, sub-consignment or debt) or that are
approved by Lessor, which approval will not be unreasonably withheld, but only
to the extent that the aggregate value, in U. S. Dollars, of the precious metals
subject to all those consignment arrangements does not exceed an amount greater
than $140,000,000;

         PERSON OR PERSON shall mean any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or other
enterprise or any government or political subdivision or any agency, department
or instrumentality thereof;

         PLAN shall mean any pension plan as defined in Section 3(2) of ERISA
and any multiemployer or single-employer plan as defined in section 4001 of
ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute by) the Parent, Lessee or a Subsidiary or an ERISA
Affiliate, and each such plan for the five year period immediately following the
latest date on which the Parent, Lessee, or a Subsidiary or an ERISA Affiliate
maintained, contributed to or had an obligation to contribute to such plan;

         PLEDGE AGREEMENT shall mean the Pledge Agreement, of even date
herewith, between the Parent, Lessee and Lessor, as collateral agent, as the
same may be amended or modified from time to time, which secures the obligations
of Lessee and the Parent under the Credit Agreement and the obligations of
Lessee under this Agreement and the Schedules;

         PLEDGED COMPANY shall mean a Material Subsidiary the capital stock of
which, or other equity or ownership interest in which, has been pledged to
Lessor, as collateral agent, under the Pledge Agreement;

         PRINCIPAL OFFICER shall mean any officer of the Parent or Lessee whose
title is (including any title which is substantially the same as): (i) Chief
Executive Officer, (ii) President, (iii) Chief Financial Officer or Vice
President-Finance, or (iv) Treasurer;

         PROHIBITED TRANSACTION shall mean a transaction with respect to a Plan
that is prohibited under section 4975 of the Code or section 406 of ERISA and
not exempt under section 4975 of the Code or section 408 of ERISA;

         RCRA shall mean the Resource Conservation and Recovery Act, as the same
may be amended from time to time, 42 U.S.C. Section 6901 ET SEQ;

         REAL PROPERTY of any person shall mean all of the right, title and
interest of such person in and to land, improvements and fixtures, including
Leaseholds;

                                    Page 29
<PAGE>   30

         REDEEMABLE STOCK shall mean with respect to any person any capital
stock or similar equity interests of such person that (i) is by its terms
subject to mandatory redemption, in whole or in part, pursuant to a sinking
fund, scheduled redemption or similar provisions, at any time prior to the
Maturity Date; or (ii) otherwise is required to be repurchased or retired on a
scheduled date or dates, upon the occurrence of any event or circumstance, or at
the option of the holder or holders thereof, or otherwise, at any time prior to
the Maturity Date, other than any such redemption, repurchase or retirement
occasioned by a "change of control" or similar event;

         REORGANIZATION shall mean the transactions described in Annex VIII to
the Credit Agreement as in effect on the Effective Date;

         SALE AND LEASE-BACK TRANSACTION shall mean any arrangement with any
person providing for the leasing by the Parent, Lessee or any Subsidiary of any
property (except for temporary leases for a term, including any renewal thereof,
of not more than one year and except for leases between the Parent, Lessee and a
Subsidiary or between Subsidiaries subject to Section XXIV(s), which property
has been or is to be sold or transferred by the Parent, Lessee or such
Subsidiary to such person;

         S&P shall mean Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., and its successors;

         SECURITY DOCUMENTS shall mean the Pledge Agreement, the Guaranty and
each other document pursuant to which any Lien or security interest is granted
by the Parent, Lessee or any Subsidiary to Lessor as security for any of the
obligations of Lessee to Lessor under or relating to this Agreement and the
Schedules;

         SOLVENT shall mean, with respect to any Person on a particular date,
that on such date (i) the fair value of the property of such Person is greater
than the total amount of liabilities, including, without limitation, contingent
liabilities, of such Person, (ii) the present fair saleable value of the assets
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (iii) such Person is able to realize upon its assets and pay its debts
and other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (iv) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature, and (v) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged;

         STANDARD PERMITTED LIENS shall mean the following:

                  (i) Liens for taxes not yet delinquent or Liens for taxes
         being contested in good faith and by appropriate proceedings for which
         adequate reserves have been established;

                  (ii) Liens in respect of property or assets imposed by law
         which were incurred in the ordinary course of business, such as
         carriers', warehousemen's, materialmen's and mechanics' Liens and other
         similar Liens arising in the ordinary course of business, which do not
         in the aggregate detract from the value of such property or assets or
         materially impair the use thereof in the operation of the business of
         the Parent, Lessee or any Subsidiary;

                                    Page 30
<PAGE>   31

                  (iii) Liens (other than any Lien imposed by ERISA) incurred or
         deposits made in the ordinary course of business in connection with
         workers' compensation, unemployment insurance and other types of social
         security; and mechanic's Liens, carrier's Liens, and other Liens to
         secure the performance of tenders, statutory obligations, contract
         bids, government contracts, performance and return-of-money bonds and
         other similar obligations, incurred in the ordinary course of business
         (exclusive of obligations in respect of the payment for borrowed
         money), whether pursuant to statutory requirements, common law or
         consensual arrangements;

                  (iv) easements, rights-of-way, zoning or deed restrictions,
         minor defects or irregularities in title and other similar charges or
         encumbrances not adversely affecting in any material respect the
         ordinary conduct of the business of the Parent, Lessee or any of the
         Subsidiaries considered as an entirety;

                  (v) Liens arising from judgments, decrees or attachments in
         circumstances not constituting a Default under Section XI(a)(ix); and

                  (vi) Leases or subleases granted to others not interfering in
         any material respect with the business of the Parent, Lessee or any of
         its Subsidiaries and any interest or title of a lessor under any lease
         not in violation of this Agreement.

         TESTING PERIOD shall mean for any determination, a single period
consisting of the four consecutive fiscal quarters of the Parent and Lessee then
last ended (whether or not such quarters are all within the same fiscal year),
EXCEPT that if a particular provision of this Agreement indicates that a Testing
Period shall be of a different specified duration, such Testing Period shall
consist of the particular fiscal quarter or quarters of the Parent and Lessee
then last ended which are so indicated in such provision; and

         UCC shall mean the Uniform Commercial Code.

         UNFUNDED CURRENT LIABILITY of any Plan shall mean the amount, if any,
by which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year exceeds the fair market value
of the assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.

         UNITED STATES AND U.S. each means United States of America.

         WHOLLY-OWNED SUBSIDIARY shall mean each Subsidiary of the Parent or
Lessee at least 95% of whose capital stock, equity interests and partnership
interests, other than director's qualifying shares or similar interests, are
owned directly or indirectly by the Parent or Lessee, as the case may be.

                  1.09 Exhibit No. 2, Exhibit No. 3 and Exhibit No. 4 to the
Lease Agreement are deleted and Exhibit No. 2, Exhibit No. 3 and Exhibit No. 4
attached to this Amendment are inserted in lieu thereof.

                        SECTION II - CONDITIONS PRECEDENT

                  2.01 It is a condition precedent to the effectiveness of this
Amendment that, prior to or on the date hereof, the following items shall have
been delivered to Lessor (in form and substance acceptable to Lessor):

                                    Page 31
<PAGE>   32

                  (a) The Credit Agreement executed by Lessee and the Parent in
form satisfactory to Lessor;

                  (b) Lessee and the Parent shall have executed and delivered to
Lessor the Pledge Agreement in the form attached to the Credit Agreement as
Exhibit F, and Lessee shall have executed and delivered to Lessor an Amended and
Restated Equipment Schedule--Schedule No. 1 in the form of Exhibit No. 2 to this
Amendment with the blanks appropriately completed (the "Restated Equipment
Schedule").

                  (c) Lessee's secretary shall have certified to Lessor (i) a
copy of resolutions duly adopted by Lessee's board of directors in respect of
this Amendment, the Restated Equipment Schedule and the Pledge Agreement, (ii)
true and correct copies of Lessee's current Articles of Incorporation and Code
of Regulations, (iii) the names and true signatures of the officers of Lessee
authorized to sign this Amendment on behalf of Lessee, and (iv) that no
"Default" or "Potential Default" (as those terms are defined in the Lease
Agreement) exists.

                  (d) Lessee shall have caused the Parent's secretary to certify
to Lessor (i) a copy of resolutions duly adopted by Parent's board of directors
in respect of the Pledge Agreement, (ii) true and correct copies of its current
Articles of Incorporation and Code of Regulations, and (iii) the names and true
signatures of the officers of Parent authorized to sign the Guaranty on behalf
of Parent.

                  (e) Counsel for Lessee and the Parent shall have rendered to
Lessor a written opinion as to the enforceability of this Amendment, the
Restated Equipment Schedule and the Pledge Agreement, in form and substance
satisfactory to Lessor.

                  (f) Lessee shall have delivered certificates of good standing
for Lessee and Parent issued by the Secretary of State of the State of Ohio.

                  (g) Lessee shall have delivered or caused to be delivered such
other documents as Lessor may reasonably request.

                  2.02 If Lessor shall consummate the transactions contemplated
hereby prior to the fulfillment of any of the conditions precedent set forth
above, the consummation of such transactions shall constitute only an extension
of time for the fulfillment of such conditions and not a waiver thereof.

                  SECTION III - REPRESENTATIONS AND WARRANTIES

                  3.01 Lessee hereby represents and warrants to Lessor as
follows:

                  (A) That all representations and warranties set forth in the
Lease Agreement and the Restated Equipment Schedule, as amended hereby, are true
and correct in all material respects, and that this Amendment, the Restated
Equipment Schedule and the Pledge Agreement have been executed and delivered by
duly authorized officers of Lessee and the Parent, as the case may be, and
constitute the legal, valid and binding obligations of Lessee and the Parent, as
the case may be, enforceable against Lessee and the Parent, as the case may be,
in accordance with their respective terms.

                  (B) That the execution, delivery and performance by Lessee of
this Amendment, the Restated Equipment Schedule and the Pledge Agreement and its
performance of the Lease Agreement, the Restated Equipment Schedule and the
other Equipment Schedules, as amended hereby, and the Pledge Agreement have been
authorized by all requisite corporate action and will not (1) violate (a) any
order of any court, or any rule, regulation or order of any other agency of
government, (b) the Articles of

                                    Page 32
<PAGE>   33

Incorporation, the Code of Regulations or any other instrument of corporate
governance of Lessee, or (c) any provision of any indenture, agreement or other
instrument to which Lessee is a party, or by which Lessee or any of its
properties or assets are or may be bound; (2) be in conflict with, result in a
breach of or constitute, alone or with due notice or lapse of time or both, a
default under any indenture, agreement or other instrument referred to in (1)(c)
above; or (3) result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever.

         SECTION IV - ACKNOWLEDGMENTS CONCERNING OUTSTANDING OBLIGATIONS

                  4.01 Lessee acknowledges and agrees that, as of the date
hereof, all of Lessee's outstanding obligations to Lessor under the Lease
Agreement and all Schedules thereto are owed without any offset, deduction,
defense or counterclaim of any nature whatsoever.

                             SECTION V - REFERENCES

                  5.01 On and after the effective date of this Amendment, as
used in the Lease Agreement, the terms "Master Lease Agreement", "Lease
Agreement", "Agreement", "this Agreement", "herein", "hereinafter", "hereto",
"hereof", and words of similar import shall, unless the context otherwise
requires, mean the Lease Agreement as amended and modified by this Amendment.
The Lease Agreement, as amended by this Amendment, together with the other
Documents, is and shall continue to be in full force and effect and is hereby
ratified and confirmed in all respects. To the extent any amendment set forth in
the First Amendment, the Second Amendment, the Third Amendment, or the Fourth
Amendment is omitted from this Amendment, the same shall be deemed eliminated as
between Lessee and Lessor effective as of the effective date hereof.

                           SECTION VI - MISCELLANEOUS

                  6.01 This Amendment may be executed in any number of
counterparts, each counterpart to be executed by one or more of the parties but,
when taken together, all counterparts shall constitute one agreement. This
Amendment, and the respective rights and obligations of the parties hereto,
shall be construed in accordance with and governed by Ohio law, without
reference to principles of conflict of laws.

                  6.02 Lessee agrees to pay to Lessor, for itself and the
account of each Participant on a pro-rata basis, a fee in an amount equal to
$134,483 at the time this Amendment is executed and delivered by Lessor and to
pay on demand all costs and expenses of Lessor, including reasonable attorneys'
fees and expenses, in connection with the preparation, execution and delivery of
this Amendment and the related documents.

                                    Page 33
<PAGE>   34

                  6.03 This Amendment is executed in accordance with and subject
to Section XIX(g) of the Lease Agreement. Except as expressly set forth in
Section 3 of this Amendment, (1) the execution, delivery and performance by
Lessee of this Amendment shall not constitute, or be deemed to be or construed
as, a waiver of any right, power or remedy of Lessee, or a waiver of any
provision of the Lease Agreement, and (2) none of the provisions of this
Amendment shall constitute, or be deemed to be or construed as, a waiver of any
"Default" or any "Potential Default," as those terms are defined in the Lease
Agreement.

                  [Remainder of Page Intentionally Left Blank]

                                   Page 34

<PAGE>   35

                  IN WITNESS WHEREOF, the parties have caused this Amendment to
be duly executed as of the day and year first above written.

<TABLE>
<S>                                                   <C>
LESSOR:                                              LESSEE:

NATIONAL CITY BANK,                                  BRUSH WELLMAN INC.
FOR ITSELF AND AS AGENT FOR
CERTAIN PARTICIPANTS

By:___________________________________               By:___________________________________

Name:_________________________________               Name:_________________________________

Title:________________________________               Title:________________________________

                  THE FOREGOING AMENDMENT is hereby acknowledged, consented and
agreed to by each of the undersigned by their respective duly authorized
officers as of the day and year first above written.

Address:                                             FIFTH THIRD BANK, NORTHEASTERN
                                                     OHIO

         1404 East Ninth Street
         Cleveland, Ohio 44114                       By:___________________________________

                                                     Title:________________________________

Address:                                             BANK ONE, MICHIGAN

         611 Woodward
         Detroit, Michigan 48226                     By:___________________________________
         Fax:  (313) 225-1212
                                                     Title:________________________________

Address:                                             HARRIS TRUST AND SAVINGS BANK
         P.O. Box 755 (111/10W)
         Chicago, Illinois 60690-0755                By:____________________________________
         Fax:  (312) 461-5225
                                                     Title:_________________________________

Address:                                             FIRSTAR BANK, N.A.

         1350 Euclid Avenue, ML 4432
         Cleveland, Ohio 44115                       By:____________________________________
         Fax:  (216) 623-9208
                                                     Title:_________________________________
</TABLE>

                                    Page 35
<PAGE>   36

                                  EXHIBIT NO. 2

                               EQUIPMENT SCHEDULE

                               SCHEDULE NO. ______
                 DATED THIS ________ DAY OF _____________, 199__
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

Lessor & Mailing Address:                   Lessee & Mailing Address:

NATIONAL CITY BANK,                         BRUSH WELLMAN INC.
FOR ITSELF AND AS AGENT FOR                 17876 St. Clair Avenue
CERTAIN PARTICIPANTS                        Cleveland, Ohio 44110
1900 East 9th Street
Cleveland, Ohio 44114

This Equipment Schedule is executed pursuant to, and incorporates by reference
the terms and conditions of, and capitalized terms not defined herein shall have
the meanings assigned to them in, the Master Lease Agreement identified above
("Agreement;" said Agreement and this Schedule being collectively referred to as
"Lease"). This Equipment Schedule, incorporating by reference the Agreement,
constitutes a separate instrument of lease.

A.       EQUIPMENT.
         ---------

         Pursuant to the terms of the Lease, Lessor agrees to acquire and lease
to Lessee the Equipment listed on Annex A attached hereto and made a part
hereof.

B.       FINANCIAL TERMS.
         ---------------

         1.       Capitalized Lessor's Cost: $______________________ (being an
                  amount equal to funds disbursed and Interim Rent accrued and
                  unpaid in respect of the Equipment and its parts and
                  components during the Interim Lease Period).

         2.       Daily Lease Rate Factor: LIBOR Rate plus the Applicable Margin
                  per annum.

         3.       Basic Term: The thirty-three month period commencing on the
                  Basic Term Commencement Date.

         4.       Basic Term Commencement Date: March 15, 1999.

         5.       Equipment Location: Lessee's plant in 14710 W. Portage River
                  South Road, Harris Township, Ottawa County, Ohio 43416.

         6.       Lessee Federal Tax ID No.:  34-0119320

         7.       Lessee agrees and acknowledges that the Capitalized Lessor's
                  Cost of the Equipment as stated on the Schedule is equal to
                  the fair market value of the Equipment on the date hereof.

<PAGE>   37

         8.       Renewal Term: Each Renewal Term will consist of a one-year
                  period, and subject to Section XVIII(b), Lessee may elect up
                  to seven (7) Renewal Terms.

         9.       Maximum Lease Term: The Term shall not exceed twelve (12)
                  years.

         10.      Stipulated Loss Values:  See Annex D.

         11.      Termination Values:  See Annex D.

         12.      Assumed Interest Rate: __________% (which will be determined
                  three (3) Business Days before the date of execution of this
                  Schedule).

         13.      Last Delivery Date:  February 15, 1999.

C.       TERM AND RENT.
         -------------

         1. Basic Term and Renewal Term Rent. Commencing on the Basic Term
Commencement Date and payable, in arrears, on the same day of each quarter
thereafter (each, a "Rent Payment Date") during the Basic Term ("Basic Term
Rent") and any Renewal Term ("Renewal Term Rent"), Lessee shall pay as Rent
quarterly installments of (a) interest on the unamortized portion of the unpaid
Capitalized Lessor's Cost as of the immediately preceding Rent Payment Date
(after application of the Rent paid on such date) at the Daily Lease Rate Factor
for the Interest Period following such immediately preceding Rent Payment Date
and (b) of principal in the principal amounts described on the Amortization
Schedule attached as Annex E. Interest shall be calculated on the basis of a 360
day year for the actual number of days elapsed. Said Rent consists of principal
and interest components, such principal components being as provided in the
Amortization Schedule attached hereto as Annex E.

         As used herein, the following terms shall have the following meanings:

         "APPLICABLE MARGIN" the particular rate per annum determined by the
Lessor in accordance with the Pricing Grid Table which appears below, based on
the ratio of Consolidated Total Debt to Consolidated EBITDAR and such Pricing
Grid Table, and the following provisions:

                  (i) Initially, until changed hereunder in accordance with the
         following provisions, the Applicable Margin will be 250 basis points
         per annum.

                  (ii) Commencing with the fiscal quarter of the Lessee ended on
         or nearest to June 30, 2000, and continuing with each fiscal quarter
         thereafter, the Lessor will determine the Applicable Margin in
         accordance with the Pricing Grid Table, based on the ratio of (x)
         Consolidated Total Debt as of the end of the fiscal quarter, to (y)
         Consolidated EBITDAR for the Testing Period ended on the last day of
         the fiscal quarter, and identified in such Pricing Grid Table. Changes
         in the Applicable Margin based upon changes in such ratio shall become
         effective on the first day of the month following the receipt by the
         Lessor pursuant to section IV(b)(i) or (ii), as applicable, of the
         financial statements of the Lessee and the Parent, accompanied by the
         certificate and calculations referred to in section IV(b)(iii),
         demonstrating the computation of such ratio, based upon the ratio in
         effect at the end of the applicable period covered (in whole or in
         part) by such financial statements.

                  (iii) Notwithstanding the above provisions, during any period
         when (A) the Lessee has failed to timely deliver or caused to be
         delivered the financial statements referred to in section

<PAGE>   38

         IV(b)(i) or (ii), accompanied by the certificate and calculations
         referred to in section IV(b)(iii), (B) a Potential Default under
         section XI(a)(1) has occurred and is continuing, or (C) a Default has
         occurred and is continuing, the Applicable Margin shall each be the
         highest rate per annum indicated therefor in the Pricing Grid Table,
         regardless of the ratio of Consolidated Total Debt to Consolidated
         EBITDAR at such time, plus 200 basis points.

                  (iv) Any changes in the Applicable Margin shall be determined
         by the Lessor in accordance with the above provisions and the Lessor
         will promptly provide notice of such determinations to the Lessee. Any
         such determination by the Lessor pursuant to these provisions shall be
         conclusive and binding absent manifest error.

                               PRICING GRID TABLE
                           (EXPRESSED IN BASIS POINTS)

<TABLE>
<CAPTION>
                      -------------------------------------------------------------------------------------------

                      RATIO OF                                                             APPLICABLE EURODOLLAR
                      CONSOLIDATED TOTAL DEBT                                              MARGIN FOR GENERAL
                      TO                                                                   REVOLVING LOANS
                      CONSOLIDATED EBITDAR

                      -------------------------------------------------------------------------------------------

<S>                                                                                                    <C>
                      greater than 3.00 to 1.00 and less than 3.50 to 1.00                                 250.00

                      -------------------------------------------------------------------------------------------

                      greater than 2.50 to 1.00 and less than or equal to 3.00 to 1.00                     225.00

                      -------------------------------------------------------------------------------------------

                      greater than 2.00 to 1.00 and less than or equal to 2.50 to 1.00                     200.00

                      -------------------------------------------------------------------------------------------

                      less than or equal to 2.00 to 1.00                                                   175.00

                      -------------------------------------------------------------------------------------------
</TABLE>

         "INTEREST PERIOD" shall mean the period beginning on the Basic Term
Commencement Date and ending on the next Rent Payment Date, and each subsequent
quarterly period.

         "LIBOR RATE" shall mean, with respect to any Interest Period occurring
during the term of the Lease, (i) the rate per annum which appears on page 3750
of the Telerate Screen (or on any successor or substitute page, or on any
electronic publication of a recognized service organization providing comparable
rate quotations, in any case as determined from time to time by the Lessor) for
deposits of $1,000,000 in same day funds for a maturity corresponding to such
Interest Period as of 11:00 A.M. (London time) on the date which is two Business
Days prior to the commencement of such Interest Period, divided (and rounded
upward to the nearest 1/16th of 1%) by (ii) a percentage equal to 100% minus the
then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves and
without benefit of credits for proration, exceptions or offsets which may be
available from time to time) applicable to any member bank of the Federal
Reserve System in respect of Eurocurrency liabilities as defined in Regulation D
(or any successor category of liabilities under Regulation D).

<PAGE>   39

         In the event that such rate is not available at such time for any
reason, the rate referred to in clause (i) above shall be the interest rate per
annum equal to the average (rounded upward to the nearest 1/16th of 1% per
annum), of the rate per annum at which U.S. Dollar deposits of $1,000,000 for a
maturity corresponding to the Interest Period are offered to each of the
Reference Banks by prime banks in the London interbank Eurodollar market,
determined as of 11:00 A.M. (London time) on the date which is two Business Days
prior to the commencement of such Interest Period.

         "Reference Banks" shall mean (i) National City Bank, and (ii) any other
bank or banks selected as a Reference Bank by National City Bank.

         "Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve (or any successor thereto), as amended or supplemented from time
to time.

         If at any time Lessor or any Participant (or, without duplication, the
bank holding company of which such Participant is a subsidiary) determines that
either adequate and reasonable means do not exist for ascertaining the LIBOR
Rate, or it becomes impractical for Lessor or any Participant to obtain funds to
make or maintain the financing hereunder with interest at the LIBOR Rate, or
Lessor or any Participant reasonably determines that, as a result of changes to
applicable law after the date of execution of the Agreement, or the adoption or
making after such date of any interpretations, directives or regulations
(whether or not having the force of law) by any court, governmental authority or
reserve bank charged with the interpretation or administration thereof, it shall
be or become unlawful or impossible to make, maintain, or fund the transaction
hereunder at the LIBOR Rate, then Lessor promptly shall give notice to Lessee of
such determination and Lessor and Lessee shall negotiate in good faith a
mutually acceptable alternative method of calculating the Daily Lease Rate
Factor and shall execute and deliver such documents as reasonably may be
required to incorporate such alternative method of calculating the Daily Lease
Rate Factor in this Schedule, within thirty (30) days after the date of Lessor's
notice to Lessee. If the parties are unable mutually to agree to such
alternative method of calculating the Daily Lease Rate Factor in a timely
fashion, (a) effective on the commencement of the next succeeding Interest
Period or the date that it becomes impractical for Lessor or any Participant to
maintain the financing hereunder with interest at the LIBOR Rate as aforesaid,
as case may be, the Daily Lease Rate Factor shall become a floating rate equal
to the Federal Funds Rate plus sixty (60) basis points, and (b) on the Rent
Payment Date next succeeding the expiration of such thirty (30) day period
Lessee shall purchase all (but not less than all) of the Equipment described on
all Schedules executed pursuant to the Agreement and shall pay to Lessor, in
cash, the purchase price for the Equipment so purchased, determined as
hereinafter provided. (As used herein, "Federal Funds Rate" means the rate of
interest, as reasonably determined by Lessor, paid by or available to Lessor for
the purchase of "federal funds" at the time or times in question on a daily
overnight basis.) The purchase price of the Equipment shall be an amount equal
to the Stipulated Loss Value of such Equipment calculated in accordance with
Annex D as of the date of payment, together with all rent and other sums then
due on such date, plus all taxes and charges upon sale and all other reasonable
and documented expenses incurred by Lessor in connection with such sale. Upon
satisfaction of the conditions specified in this Paragraph, Lessor will
transfer, on an AS IS, WHERE IS BASIS, all of Lessor's interest in and to the
Equipment. Lessor shall not be required to make and may specifically disclaim
any representation or warranty as to the condition of the Equipment and other
matters (except that Lessor shall warrant that it conveyed whatever interest it
received in such Equipment free and clear of any Lien created by Lessor). Lessor
shall execute and deliver to Lessee such Uniform Commercial Code statements of
termination as reasonably may be required in order to terminate any interest of
Lessor in and to the Equipment.

<PAGE>   40

         2. If the Rent Payment Date or any Rent Payment Date is not a Business
Day, the Rent otherwise due on such date shall be payable on the immediately
preceding Business Day.

         3. Lessee shall pay to Lessor, for the account of each Participant,
from time to time the amounts as such Participant may determine to be necessary
to compensate it for any costs which such Participant determines are
attributable to its making or maintaining its interest in the Lease and the
Equipment (the "Interest") or any reduction in any amount receivable by such
Participant in respect of any such Interest (such increases in costs and
reductions in amounts receivable being herein called "Additional Costs"),
resulting from any Regulatory Change (as defined below) which:

                  (i) changes the basis of taxation of any amounts payable to
                  Lessor for the account of such Participant in respect of such
                  Interest (other than taxes imposed on or measured by the
                  overall net income of such Participant in respect of the
                  interest by the jurisdiction in which such Participant has its
                  principal office or its lending office); or

                  (ii) imposes or modifies any reserve, special deposit or
                  similar requirements relating to any extensions of credit or
                  other assets of, or any deposits with or other liabilities of,
                  such Participant; or

                  (iii) imposes any other condition affecting this Lease or any
                  Interest.

For purposes hereof, "Regulatory Change" shall mean any change after the date of
this Lease in United States federal, state or foreign law or regulations
(including, without limitation, Regulation D or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including any Participant or under any United States federal, state or
foreign law and whether or not failure to comply therewith would be unlawful) by
any court or governmental or monetary authority charged with the interpretation
or administration thereof.

         Without limiting the effect of the foregoing Paragraph (but without
duplication), Lessee shall pay to Lessor, for the account of each Participant,
from time to time on request such amounts as such Participant may determine to
be necessary to compensate such Participant (or, without duplication, the bank
holding company of which such Participant is a subsidiary) for any costs which
it determines are attributable to the maintenance by such Participant (or any
lending office or such bank holding company), pursuant to any law or regulation
or any interpretation, directive or request (whether or not having the force of
law) of any court or governmental or monetary authority (i) following any
Regulatory Change or (ii) implementing any risk-based capital guideline or
requirement (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) heretofore or hereafter issued by
any government or governmental or supervisory authority implementing at the
national level the Basle Accord (including, without limitation, the Final
Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve
System (12 C.F.R. Part 208, Appendix A; 12 C.F.R. Part 225, Appendix A) and the
Final Risk-Based Capital Guidelines of the Office of the Comptroller of the
Currency (12 C.F.R. Part 3, Appendix A)), of capital in respect of such
Participant's Interest (such compensation to include, without limitation, an
amount equal to any reduction of the rate of return on assets or equity of such
Participant (or any lending office or bank holding company) to a level below
that which such Participant (or any lending office or bank holding company)
could have achieved but for such law, regulation, interpretation, directive or
request). For purposes of this Paragraph, "Basle Accord" shall mean the
proposals for risk-based capital framework described by the Basle Committee on
Banking Regulations and Supervisory Practices in its paper entitled
"International Convergence of Capital Measurement and Capital Standards" dated
July 1988, as amended, modified and supplemented and in effect from time to time
or any replacement thereof.

<PAGE>   41

         Each Participant shall notify Lessee of any event occurring after the
date of this Lease that will entitle such Participant to compensation under the
preceding two Paragraphs as promptly as practicable, but in any event within
thirty (30) days, after such Participant obtains actual knowledge thereof;
provided, that (i) if such Participant fails to give such notice within thirty
(30) days after it obtains actual knowledge of such an event, such Participant
shall, with respect to compensation payable pursuant to the preceding two
Paragraphs in respect of any costs resulting from such event, only be entitled
to payment under the referenced Paragraphs for costs incurred from and after the
date thirty (30) days prior to the date that such Participant does give such
notice, and (ii) such Participant will designate a different lending office for
the Interest if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the sole opinion of such Participant, be
disadvantageous to such Participant. Each Participant will furnish to Lessee a
certificate setting forth the basis and amount of each request by such
Participant for compensation under the preceding two Paragraphs. Determinations
and allocations by each Participant for purposes of the preceding two Paragraphs
shall be conclusive, absent manifest error.

D.       INSURANCE.

         1. Public Liability: $1,000,000 total liability per occurrence and
$2,000,000 in the aggregate, with excess liability in umbrella form of
$10,000,000 per occurrence and in the aggregate, with a maximum deductible
amount of (a) $1,500,000 per occurrence or (b) an amount equal to $1,500,000 per
occurrence plus the amount of any reserves specifically allocated by Lessee for
this type of liability that are satisfactory to Lessor, but in no event greater
than $2,500,000 per occurrence.

         2. Casualty and Property Damage: An amount equal to the higher of the
Stipulated Loss Value or the full replacement cost of the Equipment, with a
maximum deductible amount of $1,000,000 per occurrence.

E.       FIXED PURCHASE PRICE AND RESIDUAL RISK AMOUNT

<TABLE>
<CAPTION>
                                           Fixed Purchase Price                        Residual Risk Amount
                                          (Percent of Capitalized                     (Percent of Capitalized
End of                                        Lessor's Cost)                              Lessor's Cost)
------                                       ----------------                            ----------------

<S>                                               <C>                                          <C>
Basic Term                                        100.0000%                                    13.2500%
Renewal Term 1                                     92.1681%                                    11.4000%
Renewal Term 2                                     83.7655%                                    10.5000%
Renewal Term 3                                     74.7508%                                     9.5000%
Renewal Term 4                                     64.8705%                                     8.6500%
Renewal Term 5                                     54.0542%                                     7.3000%
Renewal Term 6                                     42.4499%                                     6.2500%
Renewal Term 7                                     30.0000%                                     4.7000%
</TABLE>

The Fixed Purchase Price and Residual Risk Amount are each expressed as a
percentage of the Capitalized Lessor's Cost of the Equipment.

         This Schedule is not binding or effective with respect to the Agreement
or Equipment until executed on behalf of Lessor and Lessee by an authorized
representative of Lessor and Lessee, respectively.

<PAGE>   42

         IN WITNESS WHEREOF, Lessee and Lessor have caused this Schedule to be
executed by their duly authorized representatives as of the date first above
written.

LESSOR:                                 LESSEE:

NATIONAL CITY BANK,                     BRUSH WELLMAN INC.
FOR ITSELF AND AS AGENT FOR
CERTAIN PARTICIPANTS

By:____________________________         By:____________________________
Name:__________________________         Name:__________________________
Title:_________________________         Title:_________________________

<PAGE>   43

                                     ANNEX A
                                       TO
                               SCHEDULE NO. ______
                 DATED THIS ______ DAY OF ______________, 199__
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

                            DESCRIPTION OF EQUIPMENT

<TABLE>
<CAPTION>
                         Type and
                         Serial                   Model of                Number                   Cost per
Vendor                   Numbers                  Equipment               of Units                 Unit
------                   -------                  ---------               --------                 ----------
<S>                      <C>                      <C>                     <C>                      <C>

Initials:         __________        __________
                    Lessor            Lessee
</TABLE>

<PAGE>   44

                                     ANNEX B
                                       TO
                               SCHEDULE NO. ______
                 DATED THIS ______ DAY OF _______________, 199__
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

                          ASSIGNMENT OF PURCHASE ORDERS

                  [See Exhibit No. 6 to Master Lease Agreement]

<PAGE>   45

                                     ANNEX C
                                       TO
                               SCHEDULE NO. ______
              DATED THIS _______ DAY OF __________________, 199___
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

                            CERTIFICATE OF ACCEPTANCE

To:      National City Bank,
         for Itself and as Agent for Certain Participants

         Pursuant to the provisions of the above Schedule and Master Lease
Agreement (collectively, the "LEASE"; capitalized terms used but not defined
herein have the meanings ascribed thereto in the Lease), Lessee hereby certifies
and warrants that (a) all equipment listed in the attached invoice or invoices
(the "Equipment") is in good condition, installed (if applicable), and in
working order; and (b) Lessee accepts the Equipment for all purposes of the
Lease, each Purchase Order relating to the Equipment and all attendant
documents.

         Lessee does further certify that as of the date hereof (i) no Default
or Potential Default has occurred; and (ii) the representations and warranties
made by Lessee pursuant to or under the Lease are true and correct on the date
hereof.

                                              BRUSH WELLMAN INC.

                                              By:_____________________________
                                              Name:___________________________
                                                       Authorized Representative

Dated:   _________________, 199__

<PAGE>   46

                                     ANNEX D
                                       TO
                             SCHEDULE NO. _________
                 DATED THIS ______ DAY OF ______________, 199__
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

                   STIPULATED LOSS AND TERMINATION VALUE TABLE

<TABLE>
<CAPTION>
                NO. OF RENT PAYMENT DATE                                      STIPULATED LOSS AND
         (after Basic Term Commencement Date)                                 TERMINATION VALUE*

<S>                                                                           <C>
                              1                                                  100.0000%
                              2                                                  100.0000%
                              3                                                  100.0000%
                              4                                                  100.0000%
                              5                                                  100.0000%
                              6                                                  100.0000%
                              7                                                  100.0000%
                              8                                                  100.0000%
                              9                                                  100.0000%
                             10                                                  100.0000%
                             11                                                  100.0000%
                             12                                                   98.0934%
                             13                                                   96.1529%
                             14                                                   94.1780%
                             15                                                   92.1681%
                             16                                                   90.1225%
                             17                                                   88.0407%
                             18                                                   85.9219%
                             19                                                   83.7655%
                             20                                                   81.5709%
                             21                                                   79.3374%
                             22                                                   77.0642%
                             23                                                   74.7508%
                             24                                                   72.3963%
                             25                                                   70.0000%
                             26                                                   67.4578%
                             27                                                   64.8705%
                             28                                                   62.2373%
                             29                                                   59.5574%
                             30                                                   56.8300%
                             31                                                   54.0542%
                             32                                                   51.2292%
                             33                                                   48.3540%
                             34                                                   45.4279%
                             35                                                   42.4499%
                             36                                                   39.4190%
</TABLE>

<PAGE>   47

<TABLE>
<S>                                                                               <C>
                             37                                                   36.3344%
                             38                                                   33.1950%
                             39                                                   30.0000%
</TABLE>

Initials: ________       _________
          Lessor         Lessee

------------------------
         *The Stipulated Loss Value and Termination Value for any unit of
Equipment shall be equal to the Capitalized Lessor's Cost of such unit
multiplied by the appropriate percentage derived from the above table. In the
event that the Lease is for any reason extended, then the last percentage figure
shown above shall control throughout any such extended term.

<PAGE>   48

                                     ANNEX E
                                       TO
                             SCHEDULE NO. _________
                  DATED THIS _____ DAY OF ______________, 199__
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

                              AMORTIZATION SCHEDULE

<TABLE>
<CAPTION>
            NO. OF RENT
            PAYMENT DATE                             PERCENT OF                             PERCENT OF
          (after Basic Term                           PRINCIPAL                         REMAINING PRINCIPAL
         Commencement Date)                           PAYABLE*                               BALANCE*

<S>                                                   <C>                                     <C>
                 1                                    0.0000%                                 100.0000%
                 2                                    0.0000%                                 100.0000%
                 3                                    0.0000%                                 100.0000%
                 4                                    0.0000%                                 100.0000%
                 5                                    0.0000%                                 100.0000%
                 6                                    0.0000%                                 100.0000%
                 7                                    0.0000%                                 100.0000%
                 8                                    0.0000%                                 100.0000%
                 9                                    0.0000%                                 100.0000%
                10                                    0.0000%                                 100.0000%
                11                                    0.0000%                                 100.0000%
                12                                    1.9066%                                  98.0934%
                13                                    1.9405%                                  96.1529%
                14                                    1.9749%                                  94.1780%
                15                                    2.0099%                                  92.1681%
                16                                    2.0456%                                  90.1225%
                17                                    2.0818%                                  88.0407%
                18                                    2.1188%                                  85.9219%
                19                                    2.1564%                                  83.7655%
                20                                    2.1946%                                  81.5709%
                21                                    2.2335%                                  79.3374%
                22                                    2.2732%                                  77.0642%
                23                                    2.3135%                                  74.7508%
                24                                    2.3545%                                  72.3963%
                25                                    2.3963%                                  70.0000%
                26                                    2.5422%                                  67.4578%
                27                                    2.5873%                                  64.8705%
                28                                    2.6332%                                  62.2373%
                29                                    2.6799%                                  59.5574%
                30                                    2.7274%                                  56.8300%
                31                                    2.7758%                                  54.0542%
                32                                    2.8250%                                  51.2292%
                33                                    2.8751%                                  48.3540%
                34                                    2.9261%                                  45.4279%
                35                                    2.9780%                                  42.4499%
                36                                    3.0309%                                  39.4190%
</TABLE>

<PAGE>   49

<TABLE>
<S>             <C>                                   <C>                                      <C>
                37                                    3.0846%                                  36.3344%
                38                                    3.1393%                                  33.1950%
                39                                    3.1950%                                  30.0000%
</TABLE>

Initials: ________       _________
          Lessor         Lessee
------------------------
         *The Principal, and the Outstanding Principal Balance as of any Rent
Payment Date payment (assuming the principal payments due on each Rental Payment
Date are paid when due), shall be equal to the Capitalized Lessor's Cost of the
Equipment multiplied by the appropriate percentage derived from the above table.

<PAGE>   50

                                     ANNEX F
                                       TO
                             SCHEDULE NO. _________
                 DATED THIS ______ DAY OF ______________, 199___
             TO MASTER LEASE AGREEMENT DATED AS OF December 30, 1996

         RETURN PROVISIONS: In addition to the provisions provided for in
Section X of this Lease, and provided that Lessee has elected not to exercise
its purchase option pursuant to Section XVIII(d) of the Lease, Lessee shall, at
its expense:

         (a) at least one hundred eighty (180) days and not more than three
hundred sixty-five (365) days prior to expiration or earlier termination of the
Lease, provide to Lessor a detailed inventory of all components of the
Equipment. The inventory should include, but not be limited to, a listing of
models and serial numbers for all components comprising the Equipment;

         (b) at least one hundred eighty (180) days prior to expiration or
earlier termination of the Lease, upon receiving reasonable notice from Lessor,
provide or cause the vendor(s) or manufacturer(s) to provide to Lessor the
following documents: (i) one set of service manuals, blueprints, process flow
diagrams and operating manuals including replacements and/or additions thereto,
such that all documentation is completely up-to-date; (ii) one set of documents,
detailing Equipment configuration, operating requirements, maintenance records,
and other mechanical data concerning the set-up and operation of the Equipment,
including replacements and/or additions thereto, such that all documentation is
completely up-to-date;

         (c) at least one hundred eighty (180) days prior to expiration or
earlier termination of the Lease, upon receiving reasonable notice from Lessor,
make the Equipment available for on-site operational inspections by potential
purchasers, under power, and provide personnel, power and other requirements
necessary to demonstrate electrical and mechanical systems for each item of the
Equipment;

         (d) at least ninety (90) days prior to expiration or earlier
termination of the Lease, cause the manufacturer's representative or qualified
equipment maintenance provider, acceptable to Lessor (the "Authorized
Inspector"), to perform a comprehensive physical inspection, including testing
all material and workmanship of the Equipment and if during such inspection,
examination and test, the Authorized Inspector finds any of the material or
workmanship to be defective or the Equipment not operating within the
manufacturer's specifications, then Lessee shall repair or replace such
defective material and, after corrective measures are completed, Lessee will
provide for a follow-up inspection of the Equipment by the Authorized Inspector
as outlined in the preceding Paragraph;

         (e) have each item of Equipment returned with an in-depth field service
report detailing said inspection as outlined in Subsection (d) above. The report
shall certify that the Equipment has been properly inspected, examined and
tested and is operating within the manufacturer's specifications;

         (f) permit Lessor to videotape the Equipment "under power" at Lessee's
or at any facility where any Equipment is located at a time during normal
working hours mutually agreeable to Lessor and Lessee prior to deinstallation;

         (g) have any repairs made to the Equipment in a professional and
workmanlike manner. Any Equipment enhancements or additions will revert to
Lessor upon expiration or earlier termination of the

<PAGE>   51

Lease and shall not affect, in an adverse manner, the Fair Market Value of the
Equipment at Lease expiration. Such additions or enhancements shall be made only
with prior written approval of Lessor (whose approval shall not unreasonably be
withheld);

         (h) have the Equipment returned in good appearance with adequate
protective coatings over all surfaces as originally painted or coated, and the
Equipment shall be free from rust, and shall be in good, complete working order;

         (i) have the Equipment cleaned (including the removal of all beryllium)
and approved by the necessary governmental agencies which regulate the use and
operation of such Equipment so as to be available for immediate use;

         (j) properly remove all Lessee installed markings which are not
necessary for the operation, maintenance or repair of the Equipment; and

         (k) provide for the deinstallation and packing of the Equipment to
include, but not be limited to, the following: (i) all process fluids shall be
removed from the Equipment and disposed of in accordance with the then current
waste disposal laws and regulations. At no time are materials which could be
considered hazardous waste by any regulatory authority to be shipped with
machinery; (ii) all internal fluids such as lube oil and hydraulic fluid are to
be filled to operating levels; filler caps are to be secured and disconnected
hoses are to be sealed to avoid spillage; (iii) the manufacturer's
representative shall deinstall and match mark all Equipment in accordance with
the specifications of the manufacturer; (iv) the Equipment shall be packed
properly and in accordance with the manufacturer's recommendations; (v) Lessee
shall provide for the transportation of the Equipment in a manner consistent
with the manufacturer's recommendations and practices to any locations within
the United States of America as Lessor shall direct; and shall have the
Equipment unloaded at such locations; and (vi) Lessee shall obtain and pay for a
policy of transit insurance for the redelivery period in an amount equal to the
replacement value of the Equipment, and Lessor shall be named as the loss payee
on all such policies of insurance.

<PAGE>   52

                                  EXHIBIT NO. 3

                             COMPLIANCE CERTIFICATE

                                                               -----------, ----

To:      National City Bank, for itself and as
           Agent for certain Participants
         1900 East Ninth Street
         Cleveland, Ohio  44114

Subject:          Master Lease Agreement, dated as of December 30, 1996, as
                  amended, between National City Bank, for itself and as Agent
                  for certain Participants, as lessor, and Brush Wellman Inc.,
                  as lessee (the "Lease Agreement")

Greetings:

                  Pursuant to Section IV(b)(iii) of the Lease Agreement and in
my capacity as the chief financial officer of Brush Wellman Inc., I hereby
certify that to the best of my knowledge and belief (capitalized terms used, but
not defined herein shall have the meanings ascribed thereto in the Lease
Agreement):

      [Form to be agreed upon by Lessee and Lessor based on Section XXIII]

                                        BRUSH WELLMAN INC.

                                        By:_____________________________________
                                        Title:__________________________________

<PAGE>   53

                                  EXHIBIT NO. 4

                     LIST OF EQUIPMENT AND ACQUISITION COST

<TABLE>
<CAPTION>
====================================================================================================================
                                                                                                    TOTAL
                                                  PURCHASE ORDER NO.                                ACQUISITION
                         EQUIPMENT                    AND VENDOR                                    COST
--------------------------------------------------------------------------------------------------------------------
<S>                                              <C>                                                 <C>
       1.     Walking Beam Furnace             EX90006/Seco-Warwick                                  $2,200,000.00
--------------------------------------------------------------------------------------------------------------------
       2.     Hot Mill                         EX90003/Griset Engineering                           $12,400,000.00
--------------------------------------------------------------------------------------------------------------------
       3.     Bell Aging Furnace               EX90012/RAD-CON Inc.                                  $1,550,000.00
--------------------------------------------------------------------------------------------------------------------
       4.     Slab Mill                        EX90007/Integrated Industrial Systems                 $7,350,000.00
--------------------------------------------------------------------------------------------------------------------
       5.     Finish Pickle Line               EX90010/SMS Process Lines                             $7,100,000.00
--------------------------------------------------------------------------------------------------------------------
       6.     Four-High Rolling Mill           EX90002/Griset Engineering                            $9,200,000.00
--------------------------------------------------------------------------------------------------------------------
       7.     Anneal/Pickle Line               1.  EX90009/SMS Process                              $13,400,000.00
                                                   Lines
                                                   Anneal/Pickle Line
                                               2.  EX90008/Drever Company
                                                   Cont. Anneal Line
--------------------------------------------------------------------------------------------------------------------
       8.     Degreasing Line                  EX90011/SMS Process Lines                             $2,300,000.00
--------------------------------------------------------------------------------------------------------------------
              TOTAL                                                                                 $55,500,000.00
====================================================================================================================
</TABLE><PAGE>   1
                                                                   Exhibit 10.a.

                              AMENDED AND RESTATED
                  RETENTION/SEVERANCE/NON-COMPETITION AGREEMENT

                         As of __________________, 2000

_________________________
_________________________
_________________________

Dear ____________________:

         Recently, Huffy Corporation (the "Company") announced it was exploring
strategic alternatives for the Company with PaineWebber Incorporated which
strategic alternatives could include the sale of the Company pursuant to an
asset and/or stock sale or pursuant to asset or stock sales of the Huffy
Companies (hereinafter defined) (the "Transactions"). The Board of Directors
considers you a key officer of the Company and needs your best efforts, skills
and dedication not only in the event of a Change of Control (hereinafter
defined) of the Company but also in connection with the other types of
Transactions to assure that the best interests of all shareholders are
protected, as determined by the Board of Directors. The Board of Directors
recognizes that the course of action which it decides upon and which you will be
responsible to implement may be contrary to your own personal interests and
needs. In order to assure the availability of your best efforts, skills and
dedication which are required in order to effect the Transactions to obtain the
most beneficial outcome for the shareholders, the Company wishes to amend the
Letter Agreement, dated ________________, as amended by letter agreement dated
September 9, 1997, and to fully restate such Agreement as an amended and
restated retention/severance/non-competition agreement herein (the "Agreement")
in order to retain your services, provide you with income protection in the
event of termination of your employment following a Transaction, and obtain from
you an agreement of non-competition. Specifically, the Company shall be bound,
in consideration of your continued services, as follows:

        1.  Upon the occurrence of any of the five events (herein called
            "Trigger Events") set out in Section 3 below, the Company shall
            immediately compute the amount of Severance Payment, as defined in
            Section 2 below ("Severance Payment"), and the Company shall
            immediately:

            (a) acquire and deliver to you a non-assignable irrevocable letter
                of credit in an amount equal to the Severance Payment naming you
                as a beneficiary ("Letter of Credit"). The Letter of Credit
                shall be issued by a major commercial bank (e.g., Bank One, NA),
                and shall be redeemable by you upon the terms described herein
                for a period of two (2) years following the occurrence of any of
                the events described in Section 4(a). If needed, the Company
                shall renew
<PAGE>   2
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               the Letter of Credit from time to time so that you always have a
               current Letter of Credit.

           (b) If the Company is unable to cause the Letter of Credit to be
               promptly issued, the Company shall immediately pay to an escrow
               account at Bank One, NA or a similar financial institution (the
               "Escrow Agent") an amount equal to the Severance Payment.

        2. (a) As used herein, Severance Payment shall mean an amount equal to
               2.99 times your "base amount" as defined in Section 280G(b)(3)
               of the Internal Revenue Code of 1986, as amended.

           (b) (i)   Notwithstanding the foregoing, in the event an independent
                     nationally recognized public accounting firm (the
                     "Accounting Firm") shall determine that receipt of all
                     Payments (as defined below) would subject you to the Excise
                     Tax, the Severance Payment shall be reduced (but not below
                     zero) to meet the definition of Reduced Amount. The
                     Accounting Firm shall make its determination of whether
                     such a reduction is required within 20 days of a
                     termination of your employment giving rise to a right to
                     receive the Severance Payment. The Accounting Firm shall
                     also make a determination, within 20 days after the
                     occurrence of any Transaction, whether you will be subject
                     to the Excise Tax with respect to any Payments other than
                     the Severance Payments.

               (ii)  Anything in this Agreement to the contrary notwithstanding,
                     in the event it shall be determined pursuant to the last
                     sentence of Section 2(b)(i) above, or as a result of a
                     proceeding described in Section 2(b)(iii) below, that any
                     Payment is subject to the Excise Tax, then you shall be
                     entitled to receive an additional payment from the Company
                     (the "Gross-Up Payment"), within 5 days after such
                     determination, in an amount such that, after you pay all
                     taxes (and any interest or penalties imposed with respect
                     to such taxes), including, without limitation, any income
                     taxes (and any interest and penalties imposed with respect
                     thereto) and Excise Tax imposed upon the Gross-Up Payment,
                     you retain an amount of the Gross-Up Payment equal to the
                     Excise Tax imposed upon the Payments.

<PAGE>   3

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               (iii) You shall notify the Company in writing of any claim by the
                     Internal Revenue Service that, if successful, would require
                     the payment by the Company of the Gross-Up Payment. Such
                     notification shall be given as soon as practicable, but no
                     later than 10 business days after you are informed in
                     writing of such claim. You shall apprise the Company of the
                     nature of such claim and the date on which such claim is
                     requested to be paid. You shall not pay such claim prior to
                     the expiration of the 30-day period following the date on
                     which you give such notice to the Company (or such shorter
                     period ending on the date that any payment of taxes with
                     respect to such claim is due). If the Company notifies you
                     in writing prior to the expiration of such period that the
                     Company desires to contest such claim, you shall:

                     (i)    give the Company any information reasonably
                            requested by the Company relating to such claim,

                     (ii)   take such action in connection with contesting such
                            claim as the Company shall reasonably request in
                            writing from time to time, including, without
                            limitation, accepting legal representation with
                            respect to such claim by an attorney reasonably
                            selected by the Company,

                     (iii)  cooperate with the Company in good faith in order
                            effectively to contest such claim, and

                     (iv)   permit the Company to participate in any proceedings
                            relating to such claim; provided, however, that the
                            Company shall bear and pay directly all costs and
                            expenses (including additional interest and
                            penalties) incurred in connection with such contest,
                            and shall indemnify and hold you harmless, on an
                            after-tax basis, for any Excise Tax or income tax
                            (including interest and penalties) imposed as a
                            result of such representation and payment of costs
                            and expenses. Without limitation on the foregoing
                            provisions of this Section 2(b)(iii), the Company
                            shall control all proceedings taken in connection
                            with such contest, and, at its sole discretion, may
                            pursue or forgo any and all administrative appeals,
                            proceedings, hearings and conferences with the
                            applicable taxing authority in respect of such claim
                            and may, at its sole discretion, either direct you
                            to pay the tax claimed and sue for a refund or
                            contest the claim in any permissible manner, and you
                            agree to prosecute such contest to a determination
                            before any administrative tribunal, in a court of
                            initial jurisdiction and in one or more appellate
                            courts, as the Company shall determine; provided,

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                            however, that, if the Company directs you to pay
                            such claim and sue for a refund, the Company shall
                            advance the amount of such payment to you, on an
                            interest-free basis, and shall indemnify and hold
                            you harmless, on an after-tax basis, from any Excise
                            Tax or income tax (including interest or penalties)
                            imposed with respect to such advance or with respect
                            to any imputed income in connection with such
                            advance; and provided, further, that any extension
                            of the statute of limitations relating to payment of
                            taxes for the taxable year with respect to which
                            such contested amount is claimed to be due is
                            limited solely to such contested amount.
                            Furthermore, the Company's control of the contest
                            shall be limited to issues with respect to which the
                            Gross-Up Payment would be payable hereunder, and you
                            shall be entitled to settle or contest, as the case
                            may be, any other issue raised by the Internal
                            Revenue Service or any other taxing authority.

                     (v)    If, after you receive an amount advanced by the
                            Company pursuant to Section 2(b)(iii), you become
                            entitled to receive any refund with respect to such
                            claim, you shall (subject to the Company's complying
                            with the requirements of Section 2(b)(iii)) promptly
                            pay to the Company the amount of such refund
                            (together with any interest paid or credited thereon
                            after taxes applicable thereto). If, after you
                            receive an amount advanced by the Company pursuant
                            to Section 2(b)(iii), a determination is made that
                            you are not entitled to any refund with respect to
                            such claim and the Company does not notify you in
                            writing of its intent to contest such denial of
                            refund prior to the expiration of 30 days after such
                            determination, then such advance shall be forgiven
                            and shall not be required to be repaid and the
                            amount of such advance shall offset, to the extent
                            thereof, the amount of Gross-Up Payment required to
                            be paid.

                     (vi)   Notwithstanding any other provision of this
                            Section 2(b), the Company may, in its sole
                            discretion, withhold and pay over to the Internal
                            Revenue Service or any other applicable taxing
                            authority, for your benefit, all or any portion of
                            the Gross-Up Payment, and you hereby consent to such
                            withholding.

                     (vii)  All fees and expenses of the Accounting Firm in
                            implementing the provisions of this Section 2(b)
                            shall be borne by the Company. All determinations
                            made by the Accounting Firm

<PAGE>   5
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                            under this Section shall be binding upon the Company
                            and on you.

                     (viii) Definitions. The following terms shall have
                            the following meanings for purposes of this Section
                            2(b)(iii):

                            "Code" means the Internal Revenue Code of 1986, as
                            amended.

                            "Excise Tax" shall mean the excise tax imposed by
                            Section 4999 of the Code, together with any interest
                            or penalties imposed with respect to such excise
                            tax.

                            A "Payment" shall mean any payment or distribution
                            in the nature of compensation (within the meaning of
                            Section 280G(b)(2) of the Code) to you or your
                            benefit, whether paid or payable pursuant to this
                            Agreement or otherwise.

                            "Reduced Amount" shall mean an amount expressed in
                            Present Value that maximizes the aggregate Present
                            Value of the Severance Payment without causing any
                            Payment to be subject to the Excise Tax.

                            "Present Value" of a Payment shall mean the economic
                            present value of a Payment as of the date of the
                            change of control for purposes of Section 280G of
                            the Code, as determined by the Accounting Firm using
                            the discount rate required by Section 280G(d)(4) of
                            the Code.

        3. The five Trigger Events are as follows:

           (a) Common Stock of the Company has been acquired other than
               directly from the Company in exchange for cash or property by
               any person who thereby becomes the owner of more than 20% of the
               Company's outstanding shares of Common Stock, except if the
               acquisition of such Common Stock is the result of an acquisition
               by the Company of a business or an entity, such acquisition
               having been approved by the Board of Directors and shareholders,
               as appropriate, with all or part of the purchase price consisting
               of more than 20% of the Company's outstanding shares of Common
               Stock; or

           (b) Any person has made a tender offer for, or a request for
               invitations for tenders of, shares of Common Stock of the
               Company; or

<PAGE>   6

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           (c) Any person forwards or causes to be forwarded to shareholders of
               the Company one or more proxy statements in any period of
               twenty-four (24) consecutive months, soliciting proxies to elect
               to the Board of Directors of the Company two or more candidates
               who were not nominated as candidates in a proxy statement
               forwarded to shareholders during such period by the Board of
               Directors of the Company.

           (d) The execution of an agreement by the Company, the consummation of
               which would result in the occurrence of a Change of Control; or

           (e) The adoption by the Board of Directors of a resolution that a
               Change of Control has occurred.

        4. If your employment is terminated, other than for disability,
           retirement on or after the date you reach normal retirement age, or
           death, within two years (y) by the Company without Cause or (z) by
           you for Good Reason after (i) the occurrence of a Change of Control
           described in clause (d) of Section 3 or (ii) the execution by the
           Company of definitive agreements to dispose of all or substantially
           all of the assets or stock of two or more of the Huffy Companies (as
           defined below), or (iii) a Change of Control, you shall have the
           right to receive the Severance Payment, within 30 days after your
           written demand therefor. For these purposes, "Cause" shall mean (A)
           your willful and continued failure to perform substantially your
           duties as an employee of the Company (other than any such failure
           resulting from incapacity due to physical or mental illness), after a
           written demand for substantial performance is delivered to you by the
           Board or the Chief Executive Officer of the Company that specifically
           identifies the manner in which the Board or the Chief Executive
           Officer of the Company believes that you have not substantially
           performed your duties, or (B) your willfully engaging in illegal
           conduct or gross misconduct that is materially and demonstrably
           injurious to the Company. For these purposes, no act, or failure to
           act, on your part shall be considered "willful" unless it is done, or
           omitted to be done, by you in bad faith and without reasonable belief
           that your action or omission was in the best interests of the
           Company. Any act, or failure to act, based upon authority given
           pursuant to a resolution duly adopted by the Board or upon the
           instructions of the Chief Executive Officer of the Company or a
           senior officer of the Company or based upon the advice of counsel for
           the Company shall be conclusively presumed to be done, or omitted to
           be done, by you in good faith and in the best interests of the
           Company. The cessation of your employment shall not be deemed to be
           for Cause unless and until there shall have been delivered to you a
           copy of a resolution duly adopted by the affirmative vote of not less
           than three-quarters of the entire membership of the Board at a
           meeting of the Board called and held for such purpose (after
           reasonable notice is provided to you and you are given an
           opportunity, together with your counsel, to be heard before the
           Board), finding that, in the good faith opinion of the Board, you are
           guilty of the conduct described above, and specifying the particulars
           thereof in detail.

<PAGE>   7

[Date]
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           "Good Reason:" means:

                    (1) the assignment to you of any duties inconsistent in any
                        respect with the Executive's position (including status,
                        offices, titles and reporting requirements, such
                        reporting requirements to be to the same or comparable
                        position), authority, duties or responsibilities as
                        contemplated by Exhibit A, attached hereto and made a
                        part hereof, or any other diminution in such position,
                        authority, duties or responsibilities (whether or not
                        occurring solely as a result of the Company's ceasing to
                        be a publicly traded entity) or any other act or
                        omission by the Company which substantially changes the
                        terms or conditions of your employment, excluding for
                        this purpose an isolated, insubstantial and inadvertent
                        action not taken in bad faith and that is remedied by
                        the Company promptly after receipt of notice thereof
                        given by the Executive;

                    (2) any failure by the Company to comply with any of the
                        provisions of the required compensation set forth on
                        Exhibit B, attached hereto and made a part hereof, other
                        than an isolated, insubstantial and inadvertent failure
                        not occurring in bad faith and that is remedied by the
                        Company promptly after receipt of notice thereof given
                        by the Executive;

                    (3) the Company's requiring you (i) to be based at any
                        office or location other than as provided in Exhibit A,
                        (ii) to be based at a location other than the current
                        principal executive offices of the Company on the day
                        prior to the Change of Control if you were employed at
                        such location immediately preceding the Effective Date,
                        or (iii) to travel on Company business to a
                        substantially greater extent than required immediately
                        prior to the Effective Date;

                    (4) any purported termination by the Company of your
                        employment otherwise than as expressly permitted by this
                        Agreement; or

                    (5) any failure by the Company to comply with and satisfy
                        Section 11(b) herein.

           For purposes of this Section 4, any good faith determination of Good
           Reason made by you shall be conclusive. Anything in this Agreement to
           the contrary notwithstanding, a termination by you for any reason
           pursuant to a notice of termination given during the 30-day period
           immediately following the first anniversary of the date of the first
           of any of the events described in Section 4(a) below to occur shall
           be deemed to be a termination for Good Reason for all purposes of
           this Agreement. Your mental or physical incapacity following the
           occurrence of an event

<PAGE>   8
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           described above in clauses (1) through (5) shall not affect your
           ability to terminate employment for Good Reason.

           (a) A "Change of Control" is hereby defined to include the occurrence
               of any one of the following events:

               (i)   Any person acquires other than directly from the Company in
                     exchange for cash or property shares of Common Stock of the
                     Company in excess of thirty percent (30%) of the Company's
                     outstanding shares of Common Stock; or

               (ii)  There is a merger, consolidation or other combination of
                     the Company with one or more other corporations as a result
                     of which more than forty-nine percent (49%) of the voting
                     stock of the merged, consolidated or combined corporation
                     is held by former shareholders of the corporations (other
                     than the Company) which are parties to such merger,
                     consolidation or other combination; or

               (iii) Two or more persons, who were not nominated as candidates
                     for the Board of Directors of the Company in proxy
                     statements forwarded to shareholders during any period of
                     twenty-four (24) consecutive months on behalf of the Board
                     of Directors of the Company, are elected to the Board of
                     Directors of the Company by the shareholders of the Company
                     voting in person or by proxy; or

               (iv)  The approval by the shareholders of the Company of a
                     reorganization, merger or consolidation or sale or other
                     disposition of all or substantially all of the assets of
                     the Company ("Business Combination") or, if consummation of
                     such Business Combination is subject, at the time of such
                     approval by shareholders, to the consent of any government
                     or governmental agency, the obtaining of such consent
                     (either explicitly or implicitly by consummation);
                     excluding, however, such a Business Combination pursuant to
                     which (i) all or substantially all of the individuals and
                     entities who were the beneficial owners of the outstanding
                     Company voting securities immediately prior to such
                     business Combination beneficially own, directly or
                     indirectly, more that 60% of, respectively, the then
                     outstanding shares of common stock and the combined voting
                     power of the then outstanding voting securities entitled to
                     vote generally in the election of directors, as the case
                     may be, of the corporation resulting from such Business
                     Combination (including, without limitation, a corporation
                     that as a result of such transaction owns the Company or
                     all or substantially all of the Company's assets either
                     directly or through one or more subsidiaries) in
                     substantially the same proportions as their ownership,
                     immediately prior to such Business Combination of the

<PAGE>   9
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                     outstanding Company voting securities, (ii) no Person
                     (excluding any employee benefit plan (or related trust) of
                     the Company or such corporation resulting from such
                     Business Combination) beneficially owns, directly or
                     indirectly, 20% or more of, respectively, the then
                     outstanding shares of common stock of the corporation
                     resulting from such Business Combination or the combined
                     voting power of the then outstanding voting securities of
                     such corporation except to the extent that such ownership
                     existed prior to the Business Combination, and (iii) all or
                     substantially all of the assets of any three of the
                     following Huffy Companies as currently configured
                     (specifically, Huffy Bicycle Company, Huffy Sports Company,
                     Huffy Service First, Inc. and Washington Inventory Service
                     (the "Huffy Companies") remain owned by the Company after
                     such Business Combination, provided, however, an event
                     under this Section 4(a) shall be deemed to have occurred
                     upon receipt of shareholder approval to the sale of all or
                     substantially all of the assets of any two of the Huffy
                     Companies currently owned by Huffy Corporation.

               (v)   Other than as set forth in Subsection (iv) above, approval
                     by the shareholders of the Company of a complete
                     liquidation or dissolution of the Company.

           (b) If your employment is terminated, voluntarily or involuntarily,
               for any reason not specified in the first sentence of this
               Section 4, you shall have no right to any Severance Payment under
               this Agreement.

           (c) The Severance Payment shall be paid to you within 30 days after
               your written demand therefor in one lump sum, either by your
               drawing upon the Letter of Credit or by payment to you by the
               Escrow Agent, as appropriate.

           (d) Your right to make a demand for the Severance Payment hereunder
               shall terminate upon the expiration or termination of two (2)
               years from the date of the last of any of the events described in
               Section 4(a) to occur, unless you have become entitled to make
               and in fact have made, a demand within that time period.

           (e) Subject to Section 2(b) herein, the Severance Payment shall be
               recomputed as of the time of the payment set forth in
               Section 4(c) and if the recomputed amount is larger, the Company
               shall immediately pay you the amount by which the recomputed
               severance Payment exceeds the Severance Payment paid in escrow or
               secured by the Letter of Credit. In the event you receive a
               Severance Payment, you shall not receive a standard Company
               severance payment under Company Policy 110, unless in
               consideration for a release and waiver executed by you, as
               requested by the Company in its sole discretion.

<PAGE>   10
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        5. The Company may terminate  the Letter of Credit or may withdraw the
           amount so deposited with the Escrow Agent pursuant to Section 1 when
           and only when (a) two (2) years have expired from the date of the
           last of any of the events described in Section 4(a) and no proper
           demand has been made during that time or (b) five (5) years have
           expired after the most recent event of the kind described in Section
           3(a), (b), (c), (d) or (e) above and no event described in
           Section 4(a) has occurred or if it did occur, no proper demand has
           been made during that time, or (c) your right to a payment under this
           Agreement has been forfeited by you, whichever occurs first. If,
           before the expiration of such period, there shall occur another event
           of the kind described in Section 3(a), (b), (c), (d) or (e) above,
           the Company will not be required to make an additional deposit.

        6. The Company agrees to pay the charges of the Letter of Credit and of
           the Escrow Agent for its services under this Agreement, and the
           Company will be entitled to any interest or other income arising from
           the amount so deposited by it.

        7. The Letter of Credit will be subject to the issuing bank's usual
           rules and procedures relating to letter of credit and the Company
           will indemnify such bank against any loss or liability for any action
           taken by it in good faith in connection with the Letter of Credit.

        8. The escrow arrangement will be subject to the Escrow Agent's usual
           rules and procedures relating thereto, and the Company will indemnify
           the Escrow Agent against any loss or liability for any action taken
           by it in good faith in such capacity.

        9. In order to effect the Transactions, one or more purchasers may seek
           covenants of non-competition and other related covenants from the
           Company and you. Any or all of the following covenants by you shall
           be assignable by the Company, without your consent or approval, to
           any entity that acquires the Company, any of the Huffy Companies, or
           any business of any of the Huffy Companies, and/or to any of the
           Huffy Companies in connection with the disposition thereof by the
           Company (each such acquisition or disposition, an "Assignment
           Event"). In the event of any such assignment, references below to the
           Company shall be deemed to include references to such assignee (an
           "Assignee") except as specifically noted below. In consideration of
           the non-competition consideration (hereinafter defined), the Company
           and you agree as follows:

<PAGE>   11
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           Confidential Information; No-Raid; Non-competition;

           (a) You shall hold in a fiduciary capacity for the benefit of the
               Company and its subsidiaries and affiliates (the "Affiliated
               Companies") all secret or confidential information, knowledge or
               data relating to the Company or any of the Affiliated Companies
               and their respective businesses (including, without limitation,
               any proprietary and not publicly available information concerning
               any processes, methods, trade secrets, research, secret data,
               costs or names of users or purchasers of their respective
               products or services, business methods, operating procedures or
               programs or methods of promotion and sale) that you obtain during
               your employment by the Company or any of the Affiliated Companies
               and that is not public knowledge (other than as a result of your
               violation of this Section 9(a) ("Confidential Information"). For
               the purposes of this Section 9(a), information shall not be
               deemed to be publicly available merely because it is embraced by
               general disclosures or because individual features or
               combinations thereof are publicly available. You shall not
               communicate, divulge or disseminate Confidential Information at
               any time during or after your employment with the Company or any
               of the Affiliated Companies, except with the prior written
               consent of the Company or its successor or assigns, or such
               Affiliated Company or its successor or assigns, as applicable,
               or as otherwise required by law or legal process. All records,
               files, memoranda, reports, customer lists, drawings, plans,
               documents and the like that you use, prepare or come into contact
               with during the course of your employment shall remain the sole
               property of the Company and/or one or more of the Affiliated
               Companies, as applicable, and shall be turned over to the Company
               or such Affiliated Companies, as applicable, upon termination of
               your employment.

           (b) You agree that you will not, any time during the Non-Competition
               Period (as defined in Section 9(c) below) (the "Non-Competition
               Period", without the prior written consent of the Company or the
               applicable Affiliated Company, as applicable, directly or
               indirectly employ, or solicit the employment of (whether as an
               employee, officer, director, agent, consultant or independent
               contractor), any person who was or is at any time during the
               previous twelve (12) months an employee, representative, officer
               or director of the Company or of any of the Affiliated Companies
               (except for such employment by the Company or any of the
               Affiliated Companies).

           (c) During the Non-Competition Period (as defined below) you shall
               not, without the prior written consent of the Board, engage in or
               become associated with a Competitive Activity. For purposes of
               this Section 9(c): (i) the "Non-Competition Period" means (A) the
               period during which you are employed by the Company, plus (B) the
               period ending on the 24 month anniversary of your date of
               termination from the Company; (ii) a "Competitive Activity" means
               any business or other endeavor, in any county of any state or any
               other country, that was being conducted by the Company or any of
               the Huffy

<PAGE>   12
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               Companies at any time after the date of this Agreement and before
               the termination of your employment; provided, that with respect
               to any Assignee, a "Competitive Activity" shall not include any
               business or other endeavor that is not acquired by the Assignee
               from the Company in the related Assignment Event; and (iii) you
               shall be considered to have become "associated with a Competitive
               Activity" if you become directly or indirectly involved as an
               owner, principal, employee, officer, director, independent
               contractor, representative, stockholder, financial backer, agent,
               partner, advisor, lender, or in any other individual or
               representative capacity with any individual partnership,
               corporation or other organization that is engaged in a
               Competitive Activity. Notwithstanding the foregoing, you may make
               and retain investments during the Employment Period in less than
               one percent of the equity of any entity engaged in a Competitive
               Activity, if such equity is listed on a national securities
               exchange or regularly traded in an over-the-counter market.

           (d) In consideration for your agreement to be bound by the
               Non-Competition covenant of Section 9(c), the Company shall pay
               you the aggregate amount of $__________ (the "Non-Competition
               Consideration") in cash in installments (the "Installments") as
               follows: In the case of an Assignment Event, you shall receive a
               percentage of the Non-Competition Consideration, as follows: if
               the Assignment Event consists of the disposition of substantially
               all of the assets or stock of one or more Huffy Companies, 10%
               times the number of Huffy Companies involved upon consummation of
               a such Transaction(s). In addition, upon the occurrence of a
               Change of Control, you shall receive 30% of the Non-Competition
               Consideration. The balance of the Non-Competition Consideration
               (being an amount when aggregated with all prior payments, if any,
               hereunder equals 100%) shall be paid in full on the date of the
               first to occur of (i) your termination of employment or (ii) the
               consummation of the Change of Control; provided, that if you
               commit any breach of the Non-Competition covenant in
               Section 9(c), then the Company shall have no further obligation
               to pay any unpaid Installment, and you shall be required to
               return to the Company all Installments that had previously been
               paid, together with interest thereon at the applicable federal
               rate as defined in Section 1274(d) of the Internal Revenue Code
               of 1986, as amended, from the date the Installment was paid to
               you through the date you repay it to the Company.

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[Date]
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           (e) All plans, discoveries and improvements, whether patentable or
               unpatentable, made or devised by you, whether alone or jointly
               with others, from the date of your initial employment by the
               Company and continuing until the end of your employment and any
               subsequent period when you are employed by the Company or any of
               the Affiliated Companies, relating or pertaining in any way to
               your employment with or the business of the Company or any of the
               Affiliated Companies, shall be promptly disclosed in writing to
               the Company and are hereby transferred to and shall redound to
               the benefit of the Company, and shall become and remain its sole
               and exclusive property. You agree to execute any assignments to
               the Company or its nominee, of your entire right, title and
               interest in and to any such discoveries and improvements and to
               execute any other instruments and documents requisite or
               desirable in applying for and obtaining patents or copyrights, at
               the expense of the Company, with respect thereto in the United
               States and in all foreign countries, that may be required by the
               Company. You further agree, during and after the Employment
               Period, to cooperate to the extent and in the manner required by
               the Company, in the prosecution or defense of any patent or
               copyright claims or any litigation, or other proceeding involving
               any trade secrets, processes, discoveries or improvements covered
               by this Agreement, but all necessary expenses thereof shall be
               paid by the Company.

           (f) You acknowledge and agree that: (i) the purpose of the foregoing
               covenants, including without limitation the Non-Competition
               covenant of Section 9(c), is to protect the goodwill, trade
               secrets and other Confidential Information of the Company;
               (ii) because of the nature of the business in which the
               Company and the Affiliated Companies are engaged and because of
               the nature of the Confidential Information to which you have
               access, it would be impractical and excessively difficult to
               determine the actual damages of the Company and the Affiliated
               Companies in the event you breach any of the covenants of this
               Section 9; and (iii) remedies at law (such as monetary damages)
               for any breach of your obligations under this Section 9 would be
               inadequate. You therefore agree and consent that if you commit
               any breach of a covenant under this Section 9 or threaten to
               commit any such breach, the Company shall have the right (in
               addition to, and not in lieu of, any other right or remedy that
               may be available to it) to temporary and permanent injunctive
               relief from a court of competent jurisdiction, without posting
               any bond or other security and without the necessity of proof of
               actual damage. With respect to any provision of this Section 9
               finally determined by a court of competent jurisdiction to be
               unenforceable, you and the Company hereby agree that such court
               shall have jurisdiction to reform this Agreement or any provision
               hereof so that it is enforceable to the maximum extent permitted
               by law, and the parties agree to abide by such court's
               determination. If any of the covenants of this Section 9 are
               determined to be wholly or partially unenforceable in any
               jurisdiction, such determination shall not be a bar to or

<PAGE>   14
[Date]
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________________________________________________________________________________

               in any way diminish the Company's right to enforce any such
               covenant in any jurisdiction.

       10. Nothing herein shall be deemed to prohibit either you or the Company
           from terminating your employment at any time.

       11. As used in this Agreement, "person" shall be deemed to have the same
           meaning as when used in Section 13 of the Securities Exchange Act of
           1934. As used in this Agreement, "Company" refers not only to Huffy
           Corporation but also to its successors by merger or otherwise.

           (a) You shall not be required to mitigate the amount of any Severance
               Payment paid to you by seeking other employment or otherwise, nor
               shall the amount of any Severance Payment be reduced by any
               compensation earned by you as the result of employment by another
               employer, by retirement benefits, by offset against any amount
               claimed to be owed by you to the Company, or otherwise.

           (b) The Company will require any successor (whether direct or
               indirect, by purchase, merger, share exchange, consolidation or
               otherwise) to all or substantially all of the business and/or
               assets of the Company to assume expressly and to agree to perform
               this Agreement in the same manner and to the same extent that the
               Company would be required to perform it if no such successor had
               taken place. Failure of the Company to obtain such assumption and
               agreement prior to the effectiveness of any such succession shall
               be a breach of this Agreement and shall entitle you to a
               Severance Payment and Non-Competition Consideration from the
               Company in the same amount and on the same terms as you would be
               entitled to hereunder after the occurrence of any Trigger Event
               and one of the events enumerated in Section 4(a) of this
               Agreement.

           (c) Subject to Section 2(b) herein, after you have the right to
               receive the Severance Payment and Non-Competition Consideration,
               as provided for in Section 4 above, the Company shall also pay to
               you, within thirty (30) days after incurred by you, an amount
               equal to all legal fees and expenses incurred in seeking to
               obtain or enforce any right or benefit provided by this Agreement
               or in connection with any tax audit or proceeding to the extent
               attributable to the application of section 4999 of the Internal
               Revenue Code of 1986, as amended from time to time, to any
               payment or benefit provided hereunder up to a maximum of
               $500,000.

       12. This Agreement cancels and supersedes, as of the date hereof, the
           prior agreement between you and the Company, dated _____________.

<PAGE>   15
[Date]
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________________________________________________________________________________

       13. Notwithstanding anything to the contrary herein, this Agreement shall
           be null and void if you have received an alternate retention
           agreement for cash incentive pay ("Retention Agreement") in
           connection with the sale of the assets or equity of the Huffy Company
           of which you are an employee and such sale has been consummated prior
           to an event in Section 4(a) having occurred. If an event under
           Section 4(a) occurs and you have received a Retention Agreement for
           cash incentive pay which is not null and void under the terms of such
           Retention Agreement, then all amounts received under the Retention
           Package shall reduce dollar for dollar but not below zero all amounts
           owed by the Company under Section 2 herein.

         In no event shall any payments be made hereunder, which would cause a
breach or Event of Default, as defined in the Loan and Security Agreement by and
among the Company, Affiliated Companies, Congress Financial Corporation and
certain financial institutions, the Credit Agreement by and among the Company,
Affiliated Companies, KeyBank National Association, as agent, and certain
financial institutions and those agreements related thereto and contemplated
thereby dated January 26, 2000. In such event as contemplated in the foregoing
sentence, the provision requiring such payment shall be deemed unenforceable and
of no force and effect, until permitted under such agreements or after the
expiration thereof.

         Please indicate your acceptance of this Agreement by signing one copy
of this letter in the space provided below and returning it to me. The other
copy is for your files.

Sincerely,

HUFFY CORPORATION

By ___________________________

AGREED TO AND ACCEPTED this _____ day of ____________________, 2000.

______________________________

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