<PAGE>
 
                                                                     EXHIBIT 3.1

                             CERTIFICATE OF MERGER
                                    MERGING
                                NGC CORPORATION
                                 WITH AND INTO
                          MIDSTREAM COMBINATION CORP.
                           PURSUANT TO SECTION 251 OF
                          THE GENERAL CORPORATION LAW
                            OF THE STATE OF DELAWARE

     The undersigned, being President of Midstream Combination Corp., a
corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware, DOES HEREBY CERTIFY AS FOLLOWS:

     FIRST:   That the name of and the state of incorporation of each of the
constituent corporations in the merger is as follows:

                                                                STATE OF
NAME                                                            INCORPORATION
----                                                            -------------

Midstream Combination Corp.                                     Delaware
NGC Corporation                                                 Delaware

     SECOND:  That the Combination Agreement and Plan of Merger dated
as of May 22, 1996 (the "Combination Agreement"), among NGC Corporation, Chevron
U.S.A. Inc. and Midstream Combination Corp. has been approved, adopted,
certified, executed and acknowledged by each of the constituent corporations in
accordance with Section 251 and Section 228 (by unanimous written consent) of
the General Corporation Law of the State of Delaware.

     THIRD:   That Midstream Combination Corp. shall be the surviving
corporation, except that the name of the surviving corporation is hereby changed
to NGC Corporation (the "Surviving Corporation").

     FOURTH:  That the Certificate of Incorporation of Midstream Combination
Corp. will be the Certificate of Incorporation of the Surviving Corporation
except that Article First of the Certificate of Incorporation of the Surviving
Corporation will be amended by virtue of the Merger to provide that "The name of
the corporation is NGC Corporation (the "Corporation")."

     FIFTH:   That an executed copy of the Combination Agreement is on file at
the principal place of business of the Surviving Corporation at the following
address:

                      13430 Northwest Freeway, Suite 1200
                               Houston, TX  77040

                                       1
<PAGE>
 
     SIXTH:   That a copy of the Combination Agreement will be furnished by the
Surviving Corporation, on request, and without cost, to any stockholder of any
constituent corporation.

     SEVENTH: The Merger shall become effective for all purposes at 11:59 p.m.,
Houston, Texas time, on August 31, 1996 (the "Effective Time").



           [The remainder of this page is intentionally left blank.]

                                       2
<PAGE>
 
     IN WITNESS WHEREOF, Midstream Combination Corp. has caused this Certificate
of Merger to be signed by David R. Dunn, President, this 29th day of August,
1996.

                                                MIDSTREAM COMBINATION CORP.



                                                ________________________________
                                                David R. Dunn
                                                President

                                       3
<PAGE>
 
                                                                     EXHIBIT 3.1

                         CERTIFICATE OF INCORPORATION
                                      OF
                          MIDSTREAM COMBINATION CORP.



     FIRST:   The name of the corporation is MIDSTREAM COMBINATION CORP. (the
"Corporation").


     SECOND:  The registered office of the Corporation in the State of Delaware
is located at Corporation Service Company, 1013 Centre Road, in the City of
Wilmington, County of New Castle. The name of the registered agent of the
Corporation at such address is Corporation Service Company.


     THIRD:   The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.


     FOURTH:

     A.  Capital Stock. The total number of shares of stock which the
Corporation shall have authority to issue is 450,000,000 shares, divided into
two classes as follows: (i) 50,000,000 shares of Preferred Stock, par value
$0.01 per share ("Preferred Stock"); and (ii) 400,000,000 shares of Common
Stock, par value $0.01 per share ("Common Stock").

     The designations and the powers, preferences, rights, qualifications,
limitations, and restrictions of the Preferred  Stock and the Common Stock of
the Corporation are as follows:

     B.  Provisions Relating to the Preferred Stock.

         1.  The Preferred Stock may be issued from time to time in one or more
series, the shares of each series to have such designations and powers,
preferences, and rights, and qualifications, limitations, and restrictions
thereof as are stated and expressed herein and in the resolution or resolutions
providing for the issuance of such series adopted by the board of directors of
the Corporation as hereafter prescribed.

         2.  Authority is hereby expressly granted to and vested in the board
of directors of the Corporation to authorize the issuance of the Preferred Stock
from time to time in one or more series, and with respect to each such series of
the Preferred Stock, to fix and state by the resolution or 

                                      -1-
<PAGE>
 
resolutions from time to time adopted providing for the issuance thereof the
following:

             (i)    whether or not such series is to have voting rights, full,
     special, or limited, or is to be without voting rights, and whether or not
     such series is to be entitled to vote as a separate class either alone or
     together with the holders of one or more other series or class of stock;

             (ii)   the number of shares to constitute such series and the
     designations thereof;

             (iii)  the preferences, and relative, participating, optional, or
     other special rights, if any, and the qualifications, limitations, or
     restrictions thereof, if any, with respect to any such series;

             (iv)   whether or not the shares of any such series shall be
     redeemable at the option of the Corporation or the holders thereof or upon
     the happening of any specified event, and, if redeemable, the redemption
     price or prices (which may be payable in the form of cash, notes,
     securities, or other property), and the time or times at which, and the
     terms and conditions upon which, such shares shall be redeemable and the
     manner of redemption;

             (v)    whether or not the shares of such series shall be subject to
     the operation of retirement or sinking funds to be applied to the purchase
     or redemption of such shares for retirement, and, if such retirement or
     sinking fund or funds are to be established, the annual amount thereof, and
     the terms and provisions relative to the operation thereof;

             (vi)   the dividend rate, whether dividends are payable in cash,
     stock of the Corporation, or other property, or a combination thereof, the
     conditions upon which and the times when such dividends are payable, the
     preference to or the relation to the payment of dividends payable on any
     other class or classes or series of stock, whether such dividends shall be
     cumulative or noncumulative, and if cumulative, the date or dates from
     which such dividends shall accumulate;

             (vii)  the preferences, if any, and the amounts thereof which the
     holders of any such series shall be entitled to receive upon the voluntary
     and involuntary dissolution of, or upon any distribution of the assets of,
     the Corporation;

             (viii) whether or not the shares of any such series, at the option
     of the Corporation or the holder thereof or upon the happening of any
     specified event, shall be convertible into or exchangeable for the 

                                      -2-
<PAGE>
 
     shares of any other class or classes or of any other series of the same or
     any other class or classes of stock, securities, or other property of the
     Corporation and the conversion price or prices or ratio or ratios or the
     rate or rates at which such exchange may be made, with such adjustments, if
     any, as shall be stated and expressed or provided for in such resolution or
     resolutions; and

             (ix)   such other special rights and provisions with respect to any
     such series as may to the board of directors of the Corporation seem
     advisable.

     3.  The shares of each series of the Preferred Stock may vary from the
shares of any other class or series thereof in any or all of the foregoing
respects.  The board of directors of the Corporation may increase the number of
shares of the Preferred Stock designated for any existing series by a resolution
adding to such series authorized and unissued shares of the Preferred Stock not
designated for any other series.  The board of directors of the Corporation may
decrease the number of shares of the Preferred Stock designated for any existing
series by a resolution, subtracting from such series unissued shares of the
Preferred Stock designated for such series, and the shares so subtracted shall
become authorized, unissued and undesignated shares of the Preferred Stock.

     C.  Provisions Relating to the Series A Participating Preferred Stock.

     1.  Designation and Amount.  The shares of such series of Preferred Stock
shall be designated as "Series A Participating Preferred Stock" (the "Series A
Preferred"), $0.01 par value per share, and the number of shares of Preferred
Stock constituting such series shall be 8,000,000.

     2.   Dividends and Distribution.  Subject to the provision for adjustment
hereinafter set forth, the holders of the Series A Preferred shall be entitled
to receive dividends or distributions equal per share in amount and kind to any
dividend or distribution payable on shares of Common Stock, when and as the same
are declared by the Board of Directors out of any funds legally available
therefor and paid to the holders of Common Stock, and no dividend may be
declared and paid on Common Stock unless an identical dividend or distribution
is declared and paid concurrently on Series A Preferred.  If, however, at any
time after the date of original issuance of Series A Preferred, the Corporation
shall subdivide or reclassify the outstanding shares of Common Stock into a
greater number of shares of Common Stock or combine or reclassify the
outstanding shares of Common Stock into a smaller number of shares of Common
Stock, then, and in each such case, the amount to which holders of the Series A
Preferred were entitled immediately prior to such event shall be adjusted by
multiplying such amount by a fraction the numerator 

                                      -3-
<PAGE>
 
of which is the number of shares of the Common Stock outstanding immediately
after such event, and the denominator of which is the number of shares of the
Common Stock outstanding immediately prior to such event. The Corporation will
have the right to issue shares of capital stock that are senior or junior to or
on a parity with the Series A Preferred with respect to dividends without the
approval or consent of the holders of Series A Preferred.

     3.  Voting Rights.  Except as provided by law, the holders of the Series A
Preferred shall have no voting rights on any matter.

     4.  Redemption.  The shares of the Series A Preferred shall not be
redeemable.

     5.  Liquidation Preference.  In the event of any liquidation, dissolution
or winding up of the Corporation, whether voluntary or involuntary, no
distribution shall be made to the holders of Common Stock or any stock ranking
junior (either as to dividends or upon liquidation, dissolution or winding up)
to the Series A Preferred unless, prior thereto, the holders of the Series A
Preferred shall have received $1.00 per share.  All assets of the Corporation
available for distribution after the liquidation preferences are fully met of
the Series A Preferred and any shares senior to or on a parity with the Series A
Preferred with respect to liquidation preferences shall be distributed ratably
among the holders of the Series A Preferred and Common Stock in proportion to
the number of shares of Series A Preferred and Common Stock outstanding at the
time of such liquidation, dissolution or winding up of the Corporation.  The
Corporation will have the right to issue shares of capital stock that are senior
or junior to or on a parity with the Series A Preferred with respect to the
liquidation, winding-up or dissolution of the Corporation without the approval
or consent of the holders of the Series A Preferred.

     6.  Conversion.  The Series A Preferred may be converted at the option of
the holder thereof, or shall be converted automatically without any action on
the part of the holder thereof, into shares of Common Stock, on the terms and
conditions set forth in this Section 6.  For purposes of this section 6, the
term "affiliate" shall mean any corporation, partnership or other entity that is
an "affiliate" within the meaning of the regulations promulgated under the
Securities Act of 1933, as amended (the "Securities Act"), as such regulations
are in effect on the date hereof, and the term "Person" shall mean any
individual, firm, corporation, partnership, association, trust, joint venture,
legal entity, political subdivision or instrumentality or other organization.

         (A) Right to Convert.  Subject to the provisions for adjustment
hereinafter set forth, each share of the Series A 

                                      -4-
<PAGE>
 
Preferred shall be convertible, at the option of the holder, at any time after
the date of issuance of such share, into one share of Common Stock as follows:

             (i)    To the extent necessary (a) to avoid dilution of the
     holder's percentage ownership of the issued Common Stock, provided that,
     with respect to dilution resulting from the issuance of additional
     compensatory options as approved by not less than eighty-five percent (85%)
     of the entire Board of Directors, the holder would have no such conversion
     right so long as its ownership of Common Stock would still be greater than
     twenty percent (20%) of the issued Common Stock, assuming for this purpose
     that all shares of Common Stock subject to currently exercisable options
     and warrants were issued and outstanding, or (b) to maintain a percentage
     ownership of the issued Common Stock at least equal to that of the then
     largest other stockholder of the Corporation;

             (ii)   To the extent necessary, if any Person other than the holder
     of Series A Preferred or an affiliate of such holder makes a tender offer
     for Common Stock and such holder desires to tender the shares of the Series
     A Preferred in the same proportion as it tenders Common Stock;

             (iii)  Upon approval by the stockholders of the Corporation of any
     merger or recapitalization proposal in which the Series A Preferred would
     be treated differently than Common Stock; and

             (iv)   Upon approval by the Corporation's stockholders of any (a)
     sale of all or substantially all of the assets of the Corporation or (b)
     liquidation, dissolution or winding up of the Corporation.

         (B) Automatic Conversion.  Subject to the provisions for adjustment
hereinafter set forth, each share of the Series A Preferred shall be
automatically converted into one share of Common Stock upon a sale or other
transfer (by operation of law, merger or otherwise) by the holder of such shares
to any Person other than an affiliate of the holder.

         (C) Conversion Rate Adjustments.  The Conversion Rate of the Series A
Preferred shall be subject to adjustment as hereinafter set forth.  If at any
time the Corporation shall subdivide or reclassify the outstanding shares of
Common Stock into a greater number of shares of Common Stock or combine or
reclassify the outstanding shares of Common Stock into a smaller number of
shares of Common Stock, then, and in each such case, the number of shares of
Common Stock into which each share of the Series A Preferred is convertible
shall be adjusted so that 

                                      -5-
<PAGE>
 
the holder of each share thereof shall be entitled to receive, upon the
conversion thereof, the number of shares of Common Stock which the holder of a
share of the Series A Preferred would have been entitled to receive after the
happening of any and all of the events described above had such share been
converted into Common Stock immediately prior to the happening of such event or
the record date therefor, whichever is earlier.

         (D) Mechanics of Conversion.  The holder of any shares of the Series A
Preferred may exercise its option to convert such shares into shares of Common
Stock by surrendering for such purpose to the Corporation, at its principal
office or at such other office or agency maintained by the Corporation for that
purpose, a certificate or certificates representing the shares of the Series A
Preferred to be converted accompanied by a written notice stating that such
holder elects to convert all or a specified whole number of such shares in
accordance with the provisions of this Section 6 and specifying the name or
names in which such holder wishes the certificate or certificates for shares of
Common Stock to be issued.  In case such notice shall specify a name or names
other than that of such holder, such notice shall be accompanied by payment of
all transfer taxes payable upon the issuance of shares of Common Stock in such
name or names.  As promptly as practicable, and in any event within five
business days after the surrender of such certificates and the receipt of such
notice relating thereto and, if applicable, payment of all transfer taxes, the
Corporation shall deliver or cause to be delivered (i) certificates representing
the number of validly issued, fully paid and nonassessable shares of Common
Stock of the Corporation to which the holder of the Series A Preferred so
converted shall be entitled (and/or any other consideration to which the holders
of such shares of Common Stock would then be entitled) and (ii) if less than the
full number of shares of the Series A Preferred evidenced by the surrendered
certificate or certificates are being converted, a new certificate or
certificates, for the number of shares evidenced by such surrendered certificate
or certificates less the number of shares converted.  Such conversions shall be
deemed to have been made upon receipt by the Corporation of such notice and such
surrendered certificate or certificates representing the shares of the Series A
Preferred to be converted, so that the rights of the holder thereof shall cease
except for the right to receive Common Stock of the Corporation in accordance
herewith (and/or any other consideration to which the holders of such shares of
Common Stock would then be entitled), and such holder shall be treated for all
purposes as having become the record holder of such Common Stock of the
Corporation at such time.

     D.  Provisions Relating to the Common Stock.

         1.  Except as otherwise required by law, and subject to any special
voting rights which may be granted any series of Preferred Stock in the board of
directors resolution which 

                                      -6-
<PAGE>
 
creates such series, each holder of Common Stock shall be entitled to one vote
for each share of Common Stock standing in such other holder's name on the
records of the Corporation on each matter submitted to a vote of the
stockholders.

         2.  Subject to the rights of the holders of the Preferred Stock, the
holders of the Common Stock shall be entitled to receive when, as, and if
declared by the board of directors of the Corporation, out of funds legally
available therefor, dividends payable in cash, stock, or otherwise.

         3.  Upon any liquidation, dissolution, or winding up of the
Corporation, whether voluntary or involuntary, and after the holders of the
Preferred Stock and the holders of any bonds, debentures, or other obligations
of the Corporation shall have been paid in full the amounts to which they shall
be entitled (if any), or a sum sufficient for such payment in full shall have
been set aside, the remaining net assets of the Corporation shall be distributed
pro rata to the holders of the Common Stock and the holders of Series A
Preferred in accordance with their respective rights and interest, to the
exclusion of the holders of any other series of the Preferred Stock and any
bonds, debentures, or other obligations of the Corporation.

         4.  Without the consent of the holders of eighty-five percent (85%)
of the outstanding Common Stock, the Corporation may (and may permit any
subsidiary of the Corporation over which it has control to) sell the following
products:

         (i)   crude oil;

         (ii)  other products usually and normally refined as petroleum products
     from crude oils; and

         (iii) natural gas liquids or liquefied petroleum gases;

irrespective of where such sales or products are made, only when the seller has
no actual knowledge that the sale is not for consumption or resale in one or
more of the following areas:

         (i)   the United States or any of its territories or possessions;

         (ii)  any country wholly located in the Western Hemisphere and/or
     Europe or surrounded by the Mediterranean Sea;

         (iii) any country all of the territory of which was formerly contained
     within the Union of Soviet Socialist Republics;

         (iv)  any country whose territory is contained within the territories
     constituting as of the date hereof the 

                                     -7- 
<PAGE>
 
     countries known as Algeria, Angola, Benin, Burkina Faso, Cameroon, Central
     African Republic, Chad, Congo, Cote D'Ivoire, Equatorial Guinea, Gabon,
     Gambia, Ghana, Greenland, Guinea, Guinea Bissau, Iceland, Liberia, Libya,
     Mali, Mauritania, Mongolia, Morocco, Niger, Nigeria, Rio Muni, Senegal,
     Sierra Leone, Togo, Tunisia, Turkey, Western Sahara and/or Zaire;

         (v)   Antarctica; and

         (vi)  international waters;

unless (a) otherwise permitted by the terms of that certain Scope of Business
Agreement, dated May 22, 1996, between the Corporation and Chevron Corporation,
as the same may from time to time be amended in accordance with the terms
thereof, or (b) such Scope of Business Agreement is terminated pursuant to its
terms, upon which termination the provisions of this paragraph 4 shall be of no
further force and effect.  A copy of such Scope of Business Agreement, as the
same may be amended, shall be available for inspection by any stockholder of the
Corporation at the principal offices of the Corporation.  Except as indicated
above or as may otherwise be provided in this Certificate of Incorporation or by
Delaware law, stockholders shall have no right to approve specific business
activities of the Corporation, and the above provisions shall not otherwise
affect corporate powers and purposes as stated in Article III.


     E.  General.

     1.  Subject to the foregoing provisions of this Certificate of
Incorporation, the Corporation may issue shares of its Preferred Stock and
Common Stock from time to time for such consideration (in any form, but not less
in value than the par value thereof) as may be fixed by the board of directors
of the Corporation, which is expressly authorized to fix the same in its
absolute and uncontrolled discretion subject to the foregoing conditions.
Shares so issued for which the consideration shall have been paid or delivered
to the Corporation shall be deemed fully paid stock and shall not be liable to
any further call or assessment thereon, and the holders of such shares shall not
be liable for any further payments in respect of such shares.

     2.  The Corporation shall have authority to create and issue rights and
options entitling their holders to purchase or otherwise acquire shares of the
Corporation's capital stock of any class or series or other securities of the
Corporation, and such rights and options shall be evidenced by instrument(s)
approved by the board of directors of the Corporation.  The board of directors
of the Corporation shall be empowered to set the exercise price, duration, times
for exercise, and other terms of such options or rights; provided, however, that
the 

                                     -8- 
<PAGE>
 
consideration to be received (which may be in any form) for any shares of
capital stock subject thereto shall have a value not less than the par value
thereof.


     FIFTH:      No contract or transaction between the Corporation and one or
more of its directors, officers, or stockholders or between the Corporation and
any person (as used herein "person" means any other corporation, partnership,
association, firm, trust, joint venture, other legal entity, political
subdivision, or instrumentality or other organization) in which one or more of
its directors, officers, or stockholders are directors, officers, or
stockholders, or have a financial interest, shall be void or voidable solely for
this reason, or solely because the director or officer is present at or
participates in the meeting of the board or committee which authorizes the
contract or transaction, or solely because his, her, or their votes are counted
for such purpose, if (i) the material facts as to his or her relationship or
interest and as to the contract or transaction are disclosed or are known to the
board of directors or the committee, and the board of directors or committee in
good faith authorizes the contract or transaction by the affirmative votes of a
majority of the disinterested directors, even though the disinterested directors
be less than a quorum; or (ii) the material facts as to his or her relationship
or interest and as to the contract or transaction are disclosed or are known to
the stockholders entitled to vote thereon, and the contract or transaction is
specifically approved in good faith by vote of the stockholders; or (iii) the
contract or transaction is fair as to the Corporation as of the time it is
authorized, approved, or ratified by the board of directors, a committee thereof
(to the extent permitted by applicable law), or the stockholders.  Common or
interested directors may be counted in determining the presence of a quorum at a
meeting of the board of directors or of a committee which authorizes the
contract or transaction.


     SIXTH:      The Corporation shall indemnify any person who was, is, or is
threatened to be made a party to a proceeding (as hereinafter defined) by reason
of the fact that he (i) is or was a director or officer of the Corporation or
(ii) while a director or officer of the Corporation, is or was serving at the
request of the Corporation as a director, officer, partner, venturer,
proprietor, trustee, employee, agent, or similar functionary of another foreign
or domestic corporation, partnership, joint venture, sole proprietorship, trust,
employee benefit plan, or other enterprise, to the fullest extent permitted
under the General Corporation Law of Delaware, as the same exists or may
hereafter be amended.  Such right shall be a contract right and shall include
the right to be paid by the Corporation expenses incurred in defending any such
proceeding in advance of its final disposition to the maximum extent permitted
under the General Corporation Law of Delaware, as the 


                                     -9- 
<PAGE>
 
same exists or may hereafter be amended. If a claim for indemnification or
advancement of expenses hereunder is not paid in full by the Corporation within
60 days after a written claim has been received by the Corporation, the claimant
may at any time thereafter bring suit against the Corporation to recover the
unpaid amount of the claim, and if successful in whole or in part, the claimant
shall also be entitled to be paid the expenses of prosecuting such claim. It
shall be a defense to any such action that such indemnification or advancement
of costs of defense are not permitted under the General Corporation Law of
Delaware, but the burden of proving such defense shall be on the Corporation.
Neither the failure of the Corporation (including its board of directors or any
committee or directors thereof, independent legal counsel, or stockholders) to
have made its determination prior to the commencement of such action that
indemnification of, or advancement of costs of defense to, the claimant is
permissible in the circumstances nor an actual determination by the Corporation
(including its board of directors or any committee or directors thereof,
independent legal counsel or stockholders) that such indemnification or
advancement is not permissible shall be a defense to the action or create a
presumption that such indemnification or advancement is not permissible. In the
event of the death of any person having a right of indemnification under the
foregoing provisions, such right shall inure to the benefit of his heirs,
executors, administrators, and personal representatives. The rights conferred
above shall not be exclusive of any other right which any person may have or
hereafter acquire under any statute, bylaw, resolution of stockholders or
directors, agreement, or otherwise. The Company shall be required to indemnify
an indemnitee in connection with a proceeding (or part thereof) initiated by
such indemnitee only if the initiation of such proceeding (or part thereof) by
the indemnitee was authorized by the board of directors of the Company.

     The Corporation's obligation, if any, to indemnify or advance expenses to
any person who was or is serving at the request of the Corporation as a
director, officer, partner, venturer, proprietor, trustee, employee, agent, or
similar functionary of another foreign or domestic corporation, partnership,
joint venture, sole proprietorship, trust, employee benefit plan, or other
enterprise shall be reduced by any amount such person may collect as
indemnification or advancement from such other foreign or domestic corporation,
partnership, joint venture, sole proprietorship, trust, employee benefit plan,
or other enterprise.

     The Corporation may additionally indemnify any employee or agent of the
Corporation to the fullest extent permitted by law.

     As used herein, the term "proceeding" means any threatened, pending, or
completed action suit, or proceeding, whether civil, criminal, administrative,
arbitrative, or investigative, any appeal in such an action, suit, or
proceeding, and any inquiry 


                                     -10-
<PAGE>
 
or investigation that could lead to such an action, suit, or proceeding.

     Any repeal or amendment of this Article SIXTH shall be prospective only and
shall not affect the rights of any such director or officer or the obligations
of the Corporation with respect to any claim arising from or related to the
services of such director or officer in any of the foregoing capacities prior to
any such repeal or amendment to this Article SIXTH.


     SEVENTH:    The board of directors shall have the power to make, adopt,
alter, amend, and repeal from time to time the Bylaws of the Corporation and to
make from time to time new Bylaws of the Corporation (subject to the right of
the stockholders entitled to vote thereon to adopt, alter, amend, and repeal
Bylaws made by the board of directors or to make new Bylaws) to the extent and
in the manner provided in the Bylaws; provided, however, that the stockholders
of the Corporation shall be entitled to adopt, alter, amend, or repeal Bylaws
made by the board of directors or to make new Bylaws solely upon the affirmative
vote of the holders of a majority of the outstanding shares of the Common Stock.


     EIGHTH:     A director of the Corporation shall not be personally liable to
the Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders, (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
Delaware, or (iv) for any transaction from which the director derived an
improper personal benefit.  Any repeal or amendment of this Article EIGHTH by
the stockholders of the Corporation shall be prospective only, and shall not
adversely affect any limitation on the personal liability of a director of the
Corporation arising from an act or omission occurring prior to the time of such
repeal or amendment.  In addition to the circumstances in which a director of
the Corporation is not personally liable as set forth in the foregoing
provisions of this Article EIGHTH, a director shall not be liable to the
Corporation or its stockholders to such further extent as permitted by any law
hereafter enacted, including without limitation any subsequent amendment to the
General Corporation Law of Delaware.


     NINTH:      The number of directors constituting the board of directors
shall be fixed by, or in the manner provided in, the Bylaws of the Corporation.
Each director of the Corporation shall hold office until the next annual meeting
of stockholders or until his or her successor shall have been duly elected and
qualified. Directors need not be elected by written ballot.

                                     -11-
<PAGE>
 
     TENTH:      The incorporator of the Corporation is Shannon M. Hernandez,
whose mailing address is 235 Montgomery Street, San Francisco, California 94104.
The power of the incorporator shall terminate upon the filing of this
Certificate of Incorporation, and the names and mailing addresses of the persons
who are to serve as directors until the first annual meeting and until their
successors are elected and qualified are:

 
        Name                        Address
        ----                        -------

     R. E. Galvin       1301 McKinney St., Houston TX 77010
 
     D. L. Paul         1301 McKinney St., Houston TX 77010
 
     D. R. Dunn         1301 McKinney St., Houston TX 77010
 

     I, THE UNDERSIGNED, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the General Corporation Law of the
State of Delaware, do make this certificate, hereby declaring and certifying
that this is my act and deed and the facts herein stated are true, and
accordingly have hereunto set my hand this 22nd day of May, 1996.



                              ----------------------------------
                                         Incorporator


                                     -12-