EXHIBIT 3.1
 
 
 
                              RESTATED CERTIFICATE
                                       OF
                                 INCORPORATION
                                       OF
                               QUANEX CORPORATION
 
 
         The original Certificate of Incorporation of Quanex Corporation (the
"Company") was filed with the Delaware Secretary of State on June 3, 1968 under
the name of Michigan Seamless Tube Company.  On August 24, 1995 the Board of
Directors of the Company duly adopted resolutions authorizing the restatement
and integration of the provisions of the Certificate of Incorporation of the
Company and authorizing the filing of this Restated Certificate of
Incorporation in accordance with Section 245 of the General Corporation Law of
the State of Delaware.  This Restated Certificate of Incorporation only
restates and integrates and does not further amend any of the provisions of the
Certificate of Incorporation of the Company presently in effect and there is no
discrepancy between the provisions of the Certificate of Incorporation of the
Company as presently in effect and the provisions of this Restated Certificate
of Incorporation.
 
         The following Restated Certificate of Incorporation supersedes the
Certificate of Incorporation of the Company as presently in effect:
 
         FIRST:  The name of the Corporation is
 
                               QUANEX CORPORATION
 
         SECOND: Its registered office in the state of Delaware is located at
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.  The
name and address of its registered agent is The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.
 
         THIRD:  The nature of the business, or objects or purposes to be
transacted, promoted or carried on are:
 
         To manufacture and fabricate tubing and pipe of every type and
         character, seamless, non-seamless, metal or non-metal, and of every
         size and description, of every shape and form, and to buy, sell, and
         trade in tubing and pipe and products made thereof, in whole or in
         part, and in any and all materials used or required in connection with
         the production and marketing of such products; to manufacture,
         deliver, buy, sell, deal in and with machines and equipment, tools,
         dies, fixtures, goods, wares, and merchandise and property of every
         kind and description.
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         To establish, maintain, conduct and carry on a general merchandising
         business; and in conjunction therewith to produce, buy, import,
         purchase and otherwise acquire, contract for, own, store, hold, use,
         sell, export, distribute, lease, pledge and otherwise dispose of and
         generally deal in and with, at wholesale or retail, as principal or
         agent for others, upon commission, consignment or otherwise, goods,
         wares, commodities, merchandise and personal property of every class,
         name, nature and description.
 
         To import, export, manufacture, produce, buy, sell and otherwise deal
         in and with, goods, wares and merchandise of every class and
         description.
 
         To manufacture, purchase or otherwise acquire, invest in, own,
         mortgage, pledge, sell, assign and transfer or otherwise dispose of,
         trade, deal in and deal with goods, wares and merchandise and personal
         property of every class and description.
 
         To acquire, and pay for in cash, stock or bonds of this corporation or
         otherwise, the good will, rights, assets and property, and to
         undertake or assume the whole or any part of the obligations or
         liabilities of any person, firm, association or corporation.
 
         To acquire, hold, use, sell, assign, lease, grant licenses in respect
         of, mortgage or otherwise dispose of letters patent of the United
         States or any foreign country, patent rights, licenses and privileges,
         inventions, improvements and processes, copyrights, trade-marks and
         trade names, relating to or useful in connection with any business of
         this corporation.
 
         To acquire by purchase, subscription or otherwise, and to receive,
         hold, own, guarantee, sell, assign, exchange, transfer, mortgage,
         pledge or otherwise dispose of or deal in and with any of the shares
         of the capital stock, or any voting trust certificates in respect of
         the shares of capital stock, scrip, warrants, rights, bonds,
         debentures, notes, trust receipts, and other securities, obligations,
         chooses in action and evidences of indebtedness or interest issued or
         created by any corporations, joint stock companies, syndicates,
         associations, firms, trusts or persons, public or private, or by the
         government of the United States of America, or by any foreign
         government, or by any state, territory, province, municipality or
         other political subdivision or by any governmental agency, and as
         owner thereof to possess and exercise all the rights, powers and
         privileges of ownership, including the right to execute consents and
         vote thereon, and to do any and all acts and things necessary or
         advisable for the preservation, protection, improvement and
         enhancement in value thereof.
 
 
 
 
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<PAGE>   3
         To enter into, make and perform contracts of every kind and
         description with any person, firm, association, corporation,
         municipality, county, state, body politic or government or colony or
         dependency thereof.
 
         To borrow or raise moneys for any of the purposes of the corporation
         and, from time to time without limit as to amount, to draw, make,
         accept, endorse, execute and issue promissory notes, drafts, bills of
         exchange, warrants, bonds, debentures and other negotiable or
         non-negotiable instruments and evidences of indebtedness, and to
         secure the payment of any thereof and of the interest thereon by
         mortgage upon or pledge, conveyance or assignment in trust of the
         whole or any part of the property of the corporation, whether at the
         time owned or thereafter acquired, and to sell, pledge or otherwise
         dispose of such bonds or other obligations of the corporation for its
         corporate purposes.
 
         To loan to any person, firm or corporation any of its surplus funds,
         either with or without security.
 
         To purchase, hold, sell and transfer the shares of its own capital
         stock; provided it shall not use its funds or property for the
         purchase of its own shares of capital stock when such use would cause
         any impairment of its capital except as otherwise permitted by law,
         and provided further that shares of its own capital stock belonging to
         it shall not be voted upon directly or indirectly.
 
         To have one or more offices, to carry on all or any of its operations
         and business and without restriction or limit as to amount to purchase
         or otherwise acquire, hold, own, mortgage, sell, convey or otherwise
         dispose of, real and personal property of every class and description
         in any of the states, districts, territories or colonies of the United
         States, and in any and all foreign countries, subject to the laws of
         such state, district, territory, colony or country.
 
         In general, to carry on any other business in connection with the
         foregoing, and to have and exercise all the powers conferred by the
         laws of Delaware upon corporations formed under the General
         Corporation Law of the State of Delaware, and to do any or all of the
         things hereinbefore set forth to the same extent as natural persons
         might or could do.
 
         The objects and purposes specified in the foregoing clauses shall,
except where otherwise expressed, be in nowise limited or restricted by
reference to, or inference from, the terms of any other clause in this Restated
Certificate of Incorporation, but
 
 
 
 
 
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<PAGE>   4
the objects and purposes specified in each of the foregoing clauses of this
Article shall be regarded as independent objects and purposes.
 
         FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is Twenty-Six Million (26,000,000),
of which Twenty-Five Million (25,000,000) shall be shares of Common Stock, par
value Fifty Cents ($.50) per share, and of which One Million (1,000,000) shares
shall be Preferred Stock, no par value.
 
         Any amendment to this Restated Certificate of Incorporation which
shall increase or decrease the authorized stock of the corporation may be
adopted by the affirmative vote of the holders of a majority of the outstanding
shares of stock of the corporation entitled to vote.
 
         The designations and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof, of the Preferred Stock
shall be as follows:
 
                 (1)      The Board of Directors is expressly authorized at any
         time, and from time to time, to provide for the issuance of shares of
         Preferred Stock in one or more series, with such voting powers, full
         or limited but not to exceed one vote per share, or without voting
         powers and with such designations, preferences and relative,
         participating, optional or other special rights, and qualifications,
         limitations or restrictions thereof, as shall be stated and expressed
         in the resolution or resolutions providing for the issue thereof
         adopted by the Board of Directors, and as are not stated and expressed
         in this Restated Certificate of Incorporation, or any amendment
         thereto, including (but without limiting the generality of the
         foregoing) the following:
 
                          (a)     the designation of such series;
 
                          (b)     the dividend rate of such series, the
                 conditions and dates upon which such dividends shall be
                 payable, the preference or relation which such dividends shall
                 bear to the dividends payable on any other class or classes or
                 of any other series of capital stock, and whether such
                 dividends shall be cumulative or non-cumulative;
 
                          (c)     whether the shares of such series shall be
                 subject to redemption by the corporation, and, if made subject
                 to such redemption, the times, prices and other terms and
                 conditions of such redemption;
 
 
 
 
 
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<PAGE>   5
                          (d)     the terms and amount of any sinking fund
                 provided for the purchase or redemption of the shares of such
                 series;
 
                          (e)     whether or not the shares of such series
                 shall be convertible into or exchangeable for shares of any
                 other class or classes or of any other series of any class or
                 classes of capital stock of the corporation, and, if provision
                 be made for conversion or exchange, the times, prices, rates,
                 adjustments, and other terms and conditions of such conversion
                 or exchanges;
 
                          (f)     the extent, if any, to which the holders of
                 the shares of such series shall be entitled to vote as a class
                 or otherwise with respect to the election of the directors or
                 otherwise; provided, however, that in no event shall any
                 holder of any series of Preferred Stock be entitled to more
                 than one vote for each share of such Preferred Stock held by
                 him;
 
                          (g)     the restrictions, if any, on the issue or
                 reissue of any additional Preferred Stock; and
 
                          (h)     the rights of the holders of the shares of
                 such series upon the dissolution of, or upon the distribution
                 of assets of, the corporation.
 
                 (2)      Except as otherwise required by law and except for
         such voting powers with respect to the election of directors or other
         matters as may be stated in the resolutions of the Board of Directors
         creating any series of Preferred Stock, the holders of any such series
         shall have no voting power whatsoever.
 
         Pursuant to the authority conferred upon the Board of Directors by the
Certificate of Incorporation of the said Corporation, the said Board of
Directors on April 26, 1989, adopted the resolution set forth on Exhibit A to
this Restated Certificate of Incorportion amending and restating the
preferences and rights of a series of 150,000 shares of Preferred Stock, no par
value, designated as Series A Junior Participating Preferred Stock.
 
         FIFTH:  The corporation is to have perpetual existence.
 
         SIXTH:  The private property of the stockholders shall not be subject
to the payment of corporate debts to any extent whatever.
 
 
 
 
 
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<PAGE>   6
         SEVENTH:         In furtherance and not in limitation of the powers
conferred by statute, the Board of Directors is expressly authorized:
 
         To authorize and cause to be executed mortgages and liens upon the
         real and personal property of the Corporation.
 
         To set apart out of any of the funds of the Corporation available for
         dividends a reserve or reserves for any proper purpose and to abolish
         any such reserve in the manner in which it was created.
 
         By resolution passed by a majority of the whole Board, to designate
         one or more committees, each committee to consist of two or more of
         the directors of the Corporation, which, to the extent provided in the
         resolution or in the bylaws of the Corporation, shall have and may
         exercise the powers of the Board of Directors in the management of the
         business and affairs of the Corporation, and may authorize the seal of
         the Corporation to be affixed to all papers which may require it.
         Such committee or committees shall have such name or names as may be
         stated in the bylaws of the Corporation or as may be determined from
         time to time by resolution adopted by the board of directors.
 
         EIGHTH: Meetings of stockholders may be held outside the State of
Delaware, if the bylaws so provide.  The books of the corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
board of directors or in the bylaws of the corporation.  Elections of directors
need not be by ballot unless the bylaws of the corporation shall so provide.
 
         NINTH:  The corporation reserves the right to amend, alter, change or
repeal any provision contained in this Restated Certificate of Incorporation,
in the manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to this reservation.
 
         TENTH:  Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this corporation under
the provisions of section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers
appointed for this corporation under the provisions of section 279 of Title 8
of the Delaware Code order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of this corporation, as the
case may be, to be
 
 
 
 
 
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<PAGE>   7
summoned in such manner as the said court directs.  If a majority in number
representing three-fourths in value of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of this corporation, as the
case may be, agree to any compromise or arrangement and to any reorganization
of this corporation as consequence of such compromise or arrangement, the said
compromise or arrangement and the said reorganization shall, if sanctioned by
the court to which the said application has been made, be binding on all the
creditors or class of creditors, and/or on all the stockholders or class of
stockholders, of this corporation, as the case may be, and also on this
corporation.
 
         ELEVENTH: The Board of Directors shall be divided into three classes
as nearly equal in number as possible, with the term of office of one class
expiring each year.  At the annual meeting of stockholders in 1974, directors
of the first class shall be elected to hold office for a term expiring at the
next succeeding annual meeting, directors of the second class shall be elected
to hold office for a term expiring at the second succeeding annual meeting and
directors of the third class shall be elected to hold office for a term
expiring at the third succeeding annual meeting.  During the intervals between
annual meetings of stockholders, any vacancy occurring in the Board of
Directors caused by resignation, removal, death, or other incapacity and any
newly created directorships resulting from an increase in the number of
directors shall be filled by a majority vote of the directors then in office,
whether or not a quorum.  Each director chosen to fill a vacancy shall hold
office for the unexpired term in respect of which such vacancy occurred.  Each
director chosen to fill a newly created directorship shall hold office until
the next election of the class for which such director shall have been chosen.
When the number of directors is changed, any newly created directorships or any
decreases in directorships shall be so apportioned among the classes as to make
all classes as nearly equal in number as possible.
 
         Any director may be removed from office as a director at any time, but
only for cause, by the affirmative vote of stockholders of record holding a
majority of the outstanding shares of stock of the corporation entitled to vote
in elections of directors at a meeting of the stockholders called for that
purpose.
 
         TWELFTH:         (A) Except as set forth in paragraph (B) of this
Article, the affirmative vote or consent of the holders of not less than
four-fifths (80%) of the outstanding shares of stock of this corporation (the
"Corporation") entitled to vote in elections of directors, voting for purposes
of this Article as one class, shall be required:
 
         (1)     to adopt any agreement for, or to approve, the merger or
                 consolidation of the Corporation or any subsidiary (as
                 hereinafter defined) with or into any other person (as
                 hereinafter defined),
 
 
 
 
 
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<PAGE>   8
         (2)     to authorize any sale, lease, transfer, exchange, mortgage,
                 pledge or other disposition to any other person of all or
                 substantially all of the assets of the Corporation or any
                 subsidiary, or
 
         (3)     to authorize the issuance or transfer by the Corporation or
                 any subsidiary of any voting securities of the Corporation or
                 any subsidiary in exchange or payment for the securities or
                 assets of any other person, if such authorization is otherwise
                 required by law or by any agreement between the Corporation
                 and any national securities exchange or by any other agreement
                 to which the Corporation or any subsidiary is a party, if, in
                 any such case, as of the record date for the determination of
                 stockholders entitled to notice thereof and to vote thereon or
                 consent thereto, such other person is, or at any time within
                 the preceding twelve months has been, the beneficial owner (as
                 hereinafter defined) of 5 percent or more of the outstanding
                 shares of stock of the Corporation entitled to vote in
                 elections of directors.  If such other person is not, and has
                 not been a 5 percent beneficial owner, the provisions of this
                 paragraph (A) shall not apply, the provisions of Delaware law
                 shall apply.
 
         (B)     The provisions of paragraph (A) of this Article shall not
apply, and the provisions of Delaware law shall apply, to (1) any transaction
described therein if the Board of Directors by resolution shall have approved a
memorandum of understanding with such other person setting forth the principal
terms of such transaction and such transaction is substantially consistent
therewith, provided that a majority of those members of the Board of Directors
voting in favor of such resolution were duly elected and acting members of the
Board of Directors prior to the time such other person became the beneficial
owner of 5 percent or more of the outstanding shares of stock of the
Corporation entitled to vote in elections of directors; or (2) any transaction
described therein if such other person is a corporation of which a majority of
the outstanding shares of all classes of stock entitled to vote in elections of
directors is owned of record or beneficially by the Corporation or its
subsidiaries.
 
         (C)     The affirmative vote or consent of the holders of not less
than four-fifths (80%) of the outstanding shares of stock of the Corporation
entitled to vote in elections of directors, voting for purposes of this Article
as one class, shall be required for the adoption of any plan for the
dissolution of the Corporation if the Board of Directors shall not have, by
resolution, recommended to the stockholders the adoption of such plan for
dissolution of the Corporation.  If the Board of Directors shall have so
recommended to the stockholders such plan for dissolution of the Corporation,
the provisions of Delaware law shall apply.
 
         (D)     For purposes of this Article,
 
 
 
 
 
                                      -8-
<PAGE>   9
                 (1)      any specified person shall be deemed to be the
         "beneficial owner" of shares of stock of the Corporation (a) which
         such specified person or any of its affiliates or associates (as such
         terms are hereinafter defined) owns, directly or indirectly, whether
         of record or not, (b) which such specified person or any of its
         affiliates or associates has the right to acquire pursuant to any
         agreement, or upon exercise of conversion rights, warrants or options,
         or otherwise, or (c) which are beneficially owned, directly or
         indirectly (including shares deemed owned through application of
         clauses (a) and (b) above), by any other person with which such
         specified person or any of its affiliates or associates has any
         agreement, arrangement or understanding for the purpose of acquiring,
         holding, voting or disposing of stock of the Corporation;
 
                 (2)      a "subsidiary" is any corporation more than 49
         percent of the voting securities of which are owned, directly or
         indirectly, by the Corporation;
 
                 (3)      a "person" is any individual, corporation or other
         entity;
 
                 (4)      an "affiliate" of a specified person is any person
         that directly, or indirectly through one or more intermediaries,
         controls, or is controlled by, or is under common control with, the
         specified person; and
 
                 (5)      an "associate" of a specified person is (a) any
         person of which such specified person is an officer or partner or is,
         directly or indirectly, the beneficial owner of 10 percent or more of
         any class of equity securities, (b) any trust or other estate in which
         such specified person has a substantial beneficial interest or as to
         which such specified person serves as trustee or in a similar
         capacity, or (c) any relative or spouse of such specified person, or
         any relative of such spouse, who has the same home as such specified
         person or who is a director or officer of such specified person or any
         corporation which controls or is controlled by such specified person.
 
         (E)     For purposes of determining whether a person owns beneficially
5 percent or more of the outstanding shares of stock of the Corporation
entitled to vote in elections of directors, the outstanding shares of stock of
the Corporation shall include shares deemed owned through application of
clauses (a), (b) or (c) of paragraph (D)(1) above but shall not include any
other shares which may be issuable pursuant to any agreement or upon exercise
of conversion rights, warrants or options, or otherwise.
 
 
 
 
 
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<PAGE>   10
         (F)     The Board of Directors shall have the power and duty to
determine, for purposes of this Article, on the basis of information known to
such Board,
 
                 (1)      whether any person referred to in paragraph (A) of
         this Article owns beneficially 5 percent or more of the outstanding
         shares of stock of the Corporation entitled to vote in elections of
         directors; and
 
                 (2)      whether a proposed transaction is substantially
         consistent with any memorandum of understanding of the character
         referred to in paragraph (B) of this Article.
 
         Any such determination shall be conclusive and binding for all
purposes of this Article.
 
         THIRTEENTH:  Notwithstanding the provisions of this Restated
Certificate of Incorporation and any provisions of the Bylaws of the
corporation, no amendment to this Restated Certificate of Incorporation shall
amend, modify or repeal any or all of the provisions of Article Eleventh,
Article Twelfth or this Article Thirteenth of this Restated Certificate of
Incorporation, and the stockholders of the corporation shall not have the right
to amend, modify or repeal any or all provisions of the Bylaws of the
corporation relating to the number or term of office of directors, unless so
adopted by the affirmative vote or consent of the holders of not less than
four-fifths (80%) of the outstanding shares of stock of the corporation
entitled to vote in elections of directors, considered for purposes of this
Article as a class; provided, however, that in the event the Board of Directors
of the corporation shall by resolution adopted by a majority of the then
directors in office recommend to the stockholders the adoption of any such
amendment, the stockholders of record holding a majority of the outstanding
shares of stock of the corporation entitled to vote in elections of directors
may amend, modify or repeal any or all of such provisions.
 
         FOURTEENTH:  (A) Except as set forth in paragraph (3) of this Article,
notwithstanding any other provision of law or requirement of these Articles,
the affirmative vote of the holders of a majority of all of the outstanding
shares of the capital stock of this Corporation (the "Corporation") entitled to
vote generally in the election of directors ("Voting Stock"),voting for the
purposes of this Article as one class, other than holders who are Related
Holders (as hereinafter defined), or Affiliates (as hereinafter defined) or
Associates (as hereinafter defined) of the Related Holder, shall be required
 
                 (1)      to adopt any agreement for, or to approve, the merger
                 or consolidation of the Corporation or any Subsidiary (as
                 hereinafter defined) with or into any Related Holder or any
                 Affiliate of a Related Holder; or
 
 
 
 
 
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<PAGE>   11
                 (2)      to authorize or approve any sale, lease, transfer,
                 exchange, mortgage, pledge or other disposition (in one
                 transaction or a series of transactions) to any Related Holder
                 or any Affiliate of a Related Holder of any assets of the
                 Corporation or any Subsidiary, having an aggregate Fair Market
                 Value (as hereinafter defined) of $5,000,000 or more; or
 
                 (3)      to authorize or approve the issuance or transfer by
                 the Corporation or any Subsidiary of any Voting Stock of the
                 Corporation or any Subsidiary in exchange or payment for
                 securities or other assets of any Related Holder or any
                 Affiliate of a Related Holder, which securities or assets have
                 an aggregate Fair Market Value of $5,000,000 or more; or
 
                 (4)      to adopt any plan or proposal for the liquidation or
                 dissolution of the Corporation proposed by or on behalf of any
                 Related Holder or any Affiliate of a Related Holder; or
 
                 (5)      to authorize or approve the reclassification of
                 securities (including any reverse stock split), or
                 recapitalization of the Corporation, or any merger or
                 consolidation of the Corporation with any of its Subsidiaries
                 or any other transaction (whether or not with or into or
                 otherwise involving any Related Holder) which has the effect,
                 directly or indirectly, of increasing the proportionate share
                 of the outstanding shares of any class of equity securities or
                 securities convertible into equity securities of the
                 Corporation or any Subsidiary which is directly or indirectly
                 owned by any Related Holder or any Affiliate of a Related
                 Holder; if there is a Related Holder as of the date in
                 question regarding any transaction described in this paragraph
                 (A) or immediately prior to the consummation of any
                 transaction described in this paragraph (A).
 
         (B)     The provisions of paragraph (A) of this Article shall not
apply to transactions set forth below in Sections (1), (2) and (3) of this
paragraph (B) and such transactions shall require only such affirmative vote as
is otherwise required by law or any other provision of this Certificate of
Incorporation:
 
         (1)     any transaction described in paragraph (A) of this Article, if
         the Board of Directors by resolution shall have approved a memorandum
         of understanding with such Related Holder, or such Affiliate of such
         Related Holder, setting forth the principal terms of such transaction
         and such transaction is effected on terms substantially consistent
         with such memorandum of understanding, provided that a majority of the
         Continuing Directors (as hereinafter defined) vote in favor of such
         resolution; or
 
         (2)     any transaction described in subparagraphs (A)(1), (A)(2),
         (A)(3) and (A)(4) of this Article, if such Related Holder, or such
         Affiliate of such Related
 
 
 
 
 
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<PAGE>   12
         Holder, is a corporation of which a majority of the outstanding shares
         of each class of Voting Stock is owned of record or beneficially by
         the Corporation or its Subsidiaries; or
 
         (3)     any transaction described in paragraph (a) of this Article, if
         the aggregate amount of the cash and the Fair Market Value of
         consideration other than cash to be received per share by holders of
         common, preferred or preference stock in such transactions shall be at
         least equal to the higher of the following:
 
                 (a)      with respect to common, preferred or preference
                 stock, the highest per share price (including any brokerage
                 commissions, transfer taxes and soliciting dealers fees) paid
                 or agreed to be paid by such Related Holder to acquire
                 beneficial ownership of any shares of such series or class of
                 stock, within the three-year period immediately prior to the
                 date of the first public announcement of the proposed
                 transaction described in paragraph (A);
 
                 (b)      the highest closing per share price of common,
                 preferred or preference stock, during the three- month period
                 immediately preceding the date of the first public
                 announcement off the proposed transaction described in
                 paragraph (A);
 
                 (c)      with respect to preferred or preference stock, if the
                 highest preferential amount per share of a series of preferred
                 or preference stock to which the holders thereof would be
                 entitled in the event of any voluntary or involuntary
                 liquidation, dissolution or winding-up of the affairs of the
                 Corporation (regardless of whether the transaction, as
                 described in paragraph (A), to be consummated constitutes such
                 an event) is greater than the aggregate amount to which the
                 holders thereof would be entitled pursuant to subparagraphs
                 (B)(3)(a) or (b), holders of such series of preferred or
                 preference stock shall receive an amount for each such share
                 at least equal to the highest preferential amount applicable
                 to such series of preferred or preference stock;
 
         except that if at any time after a Related Holder becomes such, if any
         of the following events shall occur which are not approved by a
         majority of the Continuing Directors, the provisions of this paragraph
         (B)(3) shall not apply and the provisions of paragraph (A) shall
         apply:
 
                 (1)      any failure to declare and pay at the regular date
                 therefor any full quarterly dividend (whether or not
                 cumulative) on outstanding preferred or preference stock; or
 
 
 
 
 
                                      -12-
<PAGE>   13
                 (2)      any reduction on the annual rate of dividends paid on
                 the common stock (except as necessary to reflect any
                 subdivision of the common stock); or
 
                 (3)      any failure to increase the annual rate of dividends
                 paid on the common stock as necessary to reflect any
                 reclassification (including any reverse stock split),
                 recapitalization, reorganization or any similar transaction
                 that has the effect of reducing the number of outstanding
                 shares of the common stock; or
 
                 (4)      the receipt by the Related Holder, after such Related
                 Holder has become a Related Holder, of a direct or indirect
                 benefit (except proportionately as a shareholder) from any
                 loans, advances, guarantees, pledges or other financial
                 assistance or any tax credits or other tax advantages provided
                 by the Corporation or any Subsidiary of the Corporation,
                 whether in anticipation of or in connection with a transaction
                 described in paragraph (A) or otherwise.
 
         (C)     For purposes of this Article,
 
                 (1)      a "Person" means any individual, corporation or other
                 entity;
 
                 (2)      a "Related Holder" means any Person (other than the
                 Corporation, a Subsidiary of the Corporation, or a
                 profit-sharing, employee stock ownership or other employee
                 benefit plan of the Corporation, or a Subsidiary of the
                 Corporation, or any trustee of, or fiduciary with respect to,
                 any such plan acting in such capacity) which is, or within the
                 preceding twelve-month period was, the Beneficial Owner of
                 shares of Voting Stock of the Corporation having 5 percent or
                 more of the voting power of the outstanding capital stock of
                 the Corporation;
 
                 (3)      a Person shall be deemed to be a "Beneficial Owner"
                 of shares of stock of the Corporation (a) which such Person
                 and its Affiliates and Associates beneficially own, directly
                 or indirectly, whether of record or not, or (b) which such
                 Person or any of its Affiliates or Associates has the right to
                 acquire pursuant to any agreement, upon the exercise of
                 conversion rights, warrants, options, or otherwise, or (c)
                 which such Person or any of its Affiliates or Associates has
                 the right to sell or vote pursuant to any agreement, or (d)
                 which are beneficially owned, directly or indirectly, by any
                 other Person with which such first mentioned Person or any of
                 its Affiliates or Associates has any agreement, arrangement or
                 understanding for the purposes of acquiring, holding, voting
                 or disposing of securities of the Corporation;
 
 
 
 
 
                                      -13-
<PAGE>   14
                 (4)      a "Subsidiary" means any corporation more than
                 forty-nine percent (49%) of the voting securities of which are
                 beneficially owned, directly or indirectly, by the
                 Corporation;
 
                 (5)      an "Affiliate" of a Related Holder means any person
                 that directly, or indirectly through one or more
                 intermediaries, controls, or is controlled by, or is under
                 common control with, the Related Holder;
 
                 (6)      an "Associate" of a Related Holder means (a) any
                 person of which such Related Holder is an officer, director,
                 or partner or is, directly or indirectly, the Beneficial Owner
                 of ten percent (10%) or more of any class of equity securities
                 of such person, or (b) any trust or other estate in which such
                 Related Holder has a substantial beneficial interest or as to
                 which such Related Holder serves as trustee or in a similar
                 fiduciary capacity, or (c) any relative or spouse of such
                 Related Holder, or any relative of such spouse, who has the
                 same home as such Related Holder, or (d) any person who is a
                 director or officer of such Related Holder or any corporation
                 which controls or is controlled by such Related Holder, or (e)
                 any other member or partner in a partnership, limited
                 partnership, syndicate or other group, formal or informal, of
                 which such Related Holder is a member or partner and which is
                 acting together for the purpose of acquiring, holding or
                 disposing of securities of the Corporation;
 
                 (7)      "Voting Stock" shall be the outstanding shares of the
                 capital stock of the Corporation entitled to vote generally in
                 the election of directors;
 
                 (8)      "Fair Market Value" means:  (i) in the case of stock,
                 the highest closing price during the 90- day period
                 immediately preceding the date in question of a share of such
                 stock on the Composite Tape for New York Stock Exchange-Listed
                 Stocks, or, if such stock is not quoted on the Composite Tape,
                 on the New York Stock Exchange, or, if such stock is not
                 listed on such Exchange, the fair market value on the date in
                 question of a share of such stock as determined by the Board
                 in good faith, which determination shall include consideration
                 of the highest closing price, or, in the event there is no
                 closing price, the highest closing bid in the primary market
                 in which such stock is traded during the 90-day period
                 preceding the date in question; and (ii) in the case of
                 property other than cash or stock, the fair market value of
                 such property on the date in question as determined by the
                 Board in good faith;
 
                 (9)      a "Continuing Director" means a member of the Board
                 of Directors of the Corporation who is unaffiliated with the
                 Related Holder
 
 
 
 
 
                                      -14-
<PAGE>   15
                 or any Affiliate or Associate of the Related Holder and was a
                 duly elected and acting member of the Board prior to the time
                 such Related Holder became the Beneficial Owner of 5 percent
                 or more of the Voting Stock of the Corporation, and any
                 successor to a Continuing Director who is unaffiliated with
                 the Related Holder and who is recommended to succeed a
                 Continuing Director by a majority of the then Continuing
                 Directors.
 
         (D)     A majority of the total number of Continuing Directors
(whether or not there exist any vacancies in previously authorized
directorships at the time any such determination as is hereinafter in this
paragraph (D) specified is to be made by the Board) shall have the power to
determine, on the basis of information known to them after reasonable inquiry,
all facts necessary to determine compliance with this Article, including,
without limitation, (1) whether a person is a Related Holder, (2) the number of
shares of Voting Stock beneficially owned by any person, (3) whether a person
is an Affiliate or Associate of another, (4) whether the applicable conditions
set forth in paragraph (B) have been met with respect to any transaction
described therein, and (5) whether the assets which are the subject of any
transaction referred to in section (2) of paragraph (A) have, or the
consideration to be received for the issuance or transfer of securities by the
Corporation or any Subsidiary in any transaction referred to in section (3) of
paragraph (A) has, an aggregate Fair Market Value of $5,000,000 or more.
 
         (E)     Notwithstanding any other provision of this Certificate of
Incorporation or any provision of the Bylaws of the Corporation, no amendment
to this Certificate of Incorporation shall amend, modify or repeal any or all
of the provisions of this Article, unless adopted by the affirmative vote of
the holders of a majority of all of the outstanding shares of the Voting Stock
of the Corporation, voting for the purposes of this Article as a class, other
than holders who are the Related Holder or Affiliates or Associates of the
Related Holder.
 
         FIFTEENTH:       (A)     Except for (1) any action which may be taken
solely upon the vote or consent of holders of Preferred Stock or any series
thereof, or, (2) except for any action with respect to which other Articles
expressly provide stockholder consent requirements, no action required to be
taken or which may be taken at any annual or special meeting of stockholders of
the Corporation may be taken by written consent without a meeting, except that
any such action may be taken without prior notice and without a vote, if a
consent in writing, setting forth the action so taken, shall be signed by all
the stockholders of the Corporation entitled to vote thereon.
 
         (B)     This Article shall not be amended, modified or repealed except
by the affirmative vote of the holders of not less than four-fifths (80%) of
the voting power of
 
 
 
 
 
                                      -15-
<PAGE>   16
all of the then outstanding shares of capital stock of the Corporation then
entitled to vote generally in the election of directors.
 
         SIXTEENTH:       (A)     The power to adopt, alter, amend or repeal
bylaws shall be vested in the Board of Directors, which may take such action by
the vote of a majority of the directors present and voting at a meeting where a
quorum is present, provided that if, as of the date such action shall occur,
there is a Related Holder as defined in Article FOURTEENTH of the Certificate
of Incorporation, such majority shall include a majority of the Continuing
Directors as defined in Article FOURTEENTH of the Certificate of Incorporation.
In addition, the stockholders, by the affirmative votes of the holders of not
less than four-fifths (80%) of the voting power of all of the then outstanding
shares of capital stock of the Corporation then entitled to vote generally in
the election of directors, may adopt new bylaws, or alter, amend or repeal
bylaws adopted by either the stockholders or the Board of Directors.
 
         (B)     This Article shall not be amended, modified or repealed except
by the affirmative vote of the holders of not less than four-fifths (80%) of
the voting power of all of the then outstanding shares of capital stock of the
Corporation then entitled to vote generally in the election of directors.
 
         SEVENTEENTH:  A director of the Corporation shall not personally
liable to the Corporation or its stockholders for monetary damages for breach
of fiduciary duty of the director, except for liability (i) or any breach of
the director's duty of loyalty to the Corporation or its shareholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or
knowing violation of law, (iii) under Section 174 of the General Corporation
Law of the State of Delaware, or (iv) or any transaction from which the
director derived an improper personal benefit.
 
         IN WITNESS WHEREOF, Quanex Corporation has caused this Restated
Certificate of Incorporation to be signed this 10th day of November, 1995.
 
                               QUANEX CORPORATION
 
 
 
                                                 By:   /s/ WAYNE M. ROSE   
                                                     ------------------------
                                                         Wayne M. Rose
                                                    Vice President and Chief 
                                                        Financial Officer
 
 

Filed: November 17, 1995.