Court Opinion

ID: 45980
Source: CourtListenerOpinion
Date Created: 2010-04-25 22:49:40+00
Date Added: 2024-06-11T09:26:01.926496
License: Public Domain

United States Court of Appeals
                                                               Fifth Circuit
                                                            F I L E D
                   REVISED SEPTEMBER 21, 2006
                                                            August 30, 2006
              IN THE UNITED STATES COURT OF APPEALS
                                                        Charles R. Fulbruge III
                        FOR THE FIFTH CIRCUIT                   Clerk
                       ______________________

                            No. 06-20632
                       ______________________

HALLIBURTON COMPANY BENEFITS COMMITTEE, In Its Capacity as Plan
Administrator of the Halliburton Energy Services, Inc. Welfare
Benefits Plan, including its constituent benefit program, the
Dresser Retiree Life and Medical Program; HALLIBURTON CO;
HALLIBURTON ENERGY SERVICES INCORPORATED WELFARE BENEFITS PLAN

               Plaintiffs - Appellants

     v.

JAMES GRAVES; PHIL GRIFFIN; PAUL M BRYANT, individually and as
representatives of a requested class of all similarly situated
persons

               Defendants - Appellees

          Appeal from the United States District Court
                for the Southern District of Texas

Before KING, STEWART and DENNIS, Circuit Judges.

KING, Circuit Judge:

     This class action, brought under the Employee Retirement

Income Security Act of 1974, 29 U.S.C. §§ 1001-1461 (2000)

(“ERISA”), arises from the September 1998 merger of Dresser

Industries, Inc. into a wholly owned subsidiary (Halliburton

N.C., Inc.) of Halliburton Company pursuant to the terms of a

merger agreement among the three companies and the effect of the

merger agreement on the Dresser Retiree Medical Program, an
employee welfare benefit plan under 29 U.S.C. § 1002(1).    As part

of the merger agreement, Halliburton agreed to maintain the

Dresser Retiree Medical Program for eligible participants, except

to the extent that any modifications to the program are

consistent with changes in the medical plans provided by

Halliburton for similarly situated active employees.   In November

2003, Halliburton amended three subplans of the Dresser Retiree

Medical Program “to align the benefits provided to the

participants in the three subplans more closely with the benefits

provided to other Halliburton retirees.”   Halliburton did not

make similar modifications to the plans for its own similarly

situated active employees.

     After receiving written complaints from at least three

affected Dresser retirees challenging the validity of the

November 2003 amendments in light of the merger agreement,

Halliburton filed this action against the Dresser retirees in the

district court, seeking class certification of all participants

in the Dresser Retiree Medical Program and declarations that the

November 2003 amendments are valid and that the merger agreement

does not limit Halliburton’s right to amend or terminate the

Dresser retiree program.   The parties filed cross-motions for

summary judgment, and on December 20, 2004, the district court

granted partial summary judgment in favor of the Dresser

retirees.   The district court concluded that the merger agreement

modified the Dresser Retiree Medical Program and that Halliburton

                                 2
must maintain the program for eligible participants and may amend

or terminate the program only if it makes the same changes to the

programs for its similarly situated active employees.   On June

26, 2006, the district court certified its order pursuant to 28

U.S.C. § 1292(b).   We granted Halliburton’s unopposed petition

for permission to appeal, and for the following reasons, we

AFFIRM.

              I.    FACTUAL AND PROCEDURAL BACKGROUND

A.   Factual Background

     In 1998, Dresser Industries, Inc. (“Dresser”), a Delaware

corporation in the oilfield services business, merged with

Halliburton N.C., Inc. (“Halliburton N.C.”), a newly formed

Delaware corporation and wholly owned subsidiary of Halliburton

Company (“Halliburton”), also a Delaware corporation in the

oilfield services business.   The merger was accomplished under

the Delaware General Corporation Law.   Prior to the merger,

Halliburton and Dresser separately had established welfare

benefit programs for employees and retirees.   The Halliburton

Company Welfare Benefits Plan (“Halliburton Plan”) provided very

limited medical benefits for its retirees.   On January 1, 1994,

Halliburton had amended its retiree program to eliminate medical

benefits for those retirees over the age of sixty-five who were

Medicare-eligible, unless the retiree had reached the age of

sixty-five by January 1, 1994.   For the latter retirees, the

                                  3
Halliburton Plan provided only a prescription drug benefit of $22

per month and eliminated all other medical benefits.

     The retiree medical benefits provided by the Dresser Retiree

Medical Program were significantly greater than those provided by

the Halliburton Plan at the time of the merger.   The Dresser

Retiree Medical Program consisted of separate subplans that

provided medical benefits to different groups of Dresser

retirees.   It was governed by Dresser’s umbrella plan for welfare

benefits, the Dresser Industries, Inc. Welfare Benefit Plan, Plan

750 (“Dresser Plan 750”).1   On January 1, 1993, Dresser had

amended the Dresser Retiree Medical Program to exclude additional

     1
         The most recent iteration of Dresser Plan 750 is the 1995
version. The summary plan description in effect on the date of
the merger was “Your Benefits Handbook 1997, Plan 750 For Non-
Union Employees and Retirees, Effective January 1, 1997” with
minor changes found in “Your Dresser Benefits--1998/Enrollment
Information Retiree Union-Free Version.”
        Dresser Plan 750 also governed Dresser’s other welfare
benefit programs, including the Dresser Executive Deferred
Compensation Plan, the Dresser Executive Life Insurance Program,
the Dresser Supplemental Executive Retirement Plan, and the
pension equalizer payments under the Dresser Retirement Savings
Plan.
        In their brief, the Retirees allude to provisions in the
merger agreement affecting these other welfare benefit programs;
however, our jurisdiction applies to the order certified to this
court, and that order is limited to the merger agreement’s effect
on the Dresser Retiree Medical Program. See 28 U.S.C. § 1292(b)
(2000); see also Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S.
199, 205 (1996) (“As the text of § 1292(b) indicates, appellate
jurisdiction applies to the order certified to the court of
appeals . . . . [b]ut the appellate court may address any issue
fairly included within the certified order because ‘it is the
order that is appealable, and not the controlling question
identified by the district court.’”) (quoting 9 J. MOORE & B. WARD,
MOORE’S FEDERAL PRACTICE ¶ 110.25[1] (2d ed. 1995)).

                                 4
retirees over the age of sixty-five, except for a defined group

of so-called “grandfathered” employees who remained eligible for

full medical benefits under the program after they turned sixty-

five.2   There were approximately 5500 participants in the Dresser

Retiree Medical Program when Halliburton and Dresser merged in

1998.    Since the merger, the number of grandfathered employees

has been declining, and it is these employees who are the members

of the defendant class.3   Dresser Plan 750 specifically reserved

the right to amend or terminate any of its welfare benefit plans,

including the Dresser Retiree Medical Program.

     In preparation for the merger between Halliburton and

Dresser, senior management of the two companies, along with their

financial and legal advisors, met on February 20-22, 1998, to

negotiate the terms of the merger agreement.    At a meeting on

February 20, the parties discussed Dresser Plan 750, including,

inter alia, medical benefits for Dresser retirees.4   Mark Vogel,

     2
        The “grandfathered” employees fell into three categories:
(1) existing retirees with coverage; (2) active employees who met
the age and service requirements as of January 1, 1993; and (3)
specified active employees who could “grow in” to retiree
benefits if they completed the requisite years of service before
retiring. The first group had approximately 5000 employees, and
the second and third groups had approximately 500 employees
combined.
     3
        At oral argument, counsel for the Retirees estimated that
as of May 3, 2006, the Dresser Retiree Medical Program had
between 3000-4000 participants.
     4
        David Lesar, President and Chief Operating Officer of
Halliburton, Lester Coleman, Executive Vice President and General
Counsel of Halliburton, Donald Vaughn, President and Chief

                                  5
an attorney with Weil, Gotshal & Manges, LLP, representing

Dresser, indicated in his notes from the meeting that David Lesar

(“Lesar”), then President and Chief Operating Officer of

Halliburton, “agreed to protect all [Dresser] salaried employees

who were grandfathered with respect to [the] old retiree medical

plan at no less benefits than active employees.”   The notes from

the meeting were delivered to Lesar and Lester Coleman

(“Coleman”), Executive Vice President and General Counsel of

Halliburton, at 7:00 p.m. that same day.

     Shortly after the negotiations concluded, on February 25,

1998, the companies executed the Agreement and Plan of Merger

(the “merger agreement” or “agreement”) by and among Halliburton,

Halliburton N.C., and Dresser.   On September 29, 1998, the

effective date of the agreement, Halliburton N.C. merged with and

into Dresser.   The agreement specified that “[a]s a result of the

Merger, the separate corporate existence of [Halliburton N.C.]

shall cease and [Dresser] shall continue as the Surviving

Corporation.”   It further explained that “all the property,

rights, privileges, powers and franchises of [Halliburton N.C.]

and [Dresser] shall vest in the Surviving Corporation, and all

debts, liabilities and duties of [Halliburton N.C.] and [Dresser]

shall become the debts, liabilities and duties of the Surviving

Operating Officer of Dresser, and Paul Bryant, Vice President of
Human Resources for Dresser, were among those present at the
meeting.

                                 6
Corporation.”    Under the terms of the agreement, Dresser’s

shareholders received one share of newly issued Halliburton

common stock for each share of Dresser common stock.

     The agreement itself recited that the respective boards of

directors of Halliburton and Dresser had approved the merger.

The agreement was signed by Lesar on behalf of Halliburton and

William Bradford (“Bradford”), then Chairman and Chief Executive

Officer of Dresser, on behalf of Dresser.     On June 25, 1998, the

Halliburton and Dresser shareholders approved the agreement at

separate meetings.    The agreement was to be governed by and

construed in accordance with Delaware General Corporation Law.

     This appeal primarily concerns three provisions in the

merger agreement, two of which deal with employee benefit plans

and one of which addresses the parties in interest to the merger

agreement.    The two provisions concerning employee benefit plans

are found in section 7.09, entitled “Assumption of Obligations to

Issue Stock and Obligations of Employee Benefits Plan;

Employees.”     First, section 7.09(g)(i) states that:

     (g) [Halliburton] shall and shall cause the Surviving
     Corporation and each Subsidiary of the Surviving
     Corporation to take all corporate action necessary to:
          (i) maintain with respect to eligible participants
          (as of [September 29, 1998]) the [Dresser] retiree
          medical plan, except to the extent that any
          modifications thereto are consistent with changes
          in the medical plans provided by [Halliburton] and
          its subsidiaries for similarly situated active
          employees . . . .

Following this provision, section 7.09(h) provides that:

                                   7
     Subject to Section 7.09(g), until the third anniversary
     of the Effective Time [of the merger agreement] (the
     “Benefits Maintenance Period”) [Halliburton] shall and
     shall cause the Surviving Corporation and each Subsidiary
     of the Surviving Corporation to provide each employee of
     [Dresser] or any of its Subsidiaries at the Effective
     Time (“Company Participants”) with employee benefits and
     compensation   after   the   Effective  Time    that  are
     substantially comparable to similarly situated employees
     of [Halliburton] and its Subsidiaries.

     The parties also included a section covering the parties in

interest to the merger agreement.     Section 10.07 states that the

agreement shall inure solely to the benefit of each party and

that nothing in the agreement is intended to confer upon any

other person any right, benefit, or remedy.    It also provides an

exception to its general prohibition on third-party

beneficiaries:

     Notwithstanding the foregoing and any other provision of
     this Agreement, and in addition to any other required
     action of the Board of Directors of [Halliburton] a
     majority of the directors . . . serving on the Board of
     Directors of [Halliburton] who are designated by
     [Dresser] pursuant to Section 7.13 shall be entitled
     during the three year period commencing at the Effective
     Time (the “Three Year Period”) to enforce the provisions
     of Sections 7.09 and 7.13 on behalf of the Company’s
     officers, directors and employees, as the case may be.
     Such directors’ rights and remedies under the preceding
     sentence are cumulative and are in addition to any other
     rights and remedies that they may have at law or in
     equity, but in no event shall this Section 10.07 be
     deemed to impose any additional duties on any such
     directors. . . .

     Following the merger, the Halliburton Plan and Dresser Plan

750 were separately maintained.    Because the welfare plans

differed in many respects, proper administration of the plans

posed a significant challenge.    For Dresser Plan 750, this

                                  8
responsibility fell, at least in part, on Paul Bryant (“Bryant”),

the former Dresser Vice President of Human Resources who became

the Halliburton Shared Services Vice President of Human Resources

after the merger.   On May 14, 1999, almost eight months after the

effective date of the merger, Bryant submitted a memorandum and a

notebook to senior management, including, inter alios, Bradford,

Coleman, and Celeste Colgan (“Colgan”), Halliburton’s Vice

President of Administration.   The memorandum and the notebook,

entitled “Dresser Legacy--Employee Pay and Benefit Obligations,

Merger Agreement Section 7.09(g),” were prepared, and, in the

case of the memorandum, signed, in the regular course of Bryant’s

employment as Vice President at Halliburton.   In the memorandum,

Bryant stated that he had prepared the notebook “to assist in

complying with the Merger Agreement, Section 7.09(g).”   Bryant

also noted that “[s]ince [he] was the primary figure from Dresser

dealing with pay and benefit matters at the Merger negotiations,

[he] thought it would be helpful to provide this material before

[he] retired.”   With regard to the Dresser Retiree Medical

Program and section 7.09(g)(i), the provision in the merger

agreement concerning the retirees’ program, Bryant explained

that:

     During the merger negotiations, Dresser wanted to ensure
     that the Dresser Retiree Medical plan was kept similar to
     the current plan but recognized that the future was
     unpredictable.    Thus, wording was included that gave
     Halliburton the ability to make changes to the Dresser
     Retiree Medical plan as long as the same changes were
     being made to active employees. For example, if business

                                 9
     conditions caused Halliburton to increase active employee
     contributions 20% and raise the minimum deductible to
     $1,000, the same actions could be taken to the Dresser
     Retiree Medical plan participants.

     There is no indication in the record that Halliburton or any

senior management of Halliburton receiving the memorandum and

notebook disputed Bryant’s interpretation of the Dresser Retiree

Medical Program or that administration of the retiree program was

being carried out contrary to Bryant’s interpretation.   Rather,

Halliburton’s correspondence indicates that it was mindful of its

obligations to Dresser retirees under the merger agreement.      For

example, on February 16, 1999, Colgan wrote a letter to Clint

Ables (“Ables”), one of the Dresser retirees, in response to

Ables’s request for a copy of the Dresser Summary Plan

Description for the retiree medical program.   Colgan explained

that although she was enclosing a copy of the 1997 handbook--the

version existing before the 1998 merger--that version “contains

the benefit information pertaining to coverage currently extended

to Dresser ‘grandfathered’ retirees.”   She also noted that

Halliburton “is mindful of its obligation to ‘maintain with

respect to eligible participants . . . [Dresser’s] retiree

medical plan except to the extent that any modifications thereto

are consistent with changes in the medical plans provided by

[Halliburton] and its subsidiaries for similarly situated active

employees.’”

     Less than a year after the effective date of the merger,

                                10
Halliburton started taking action to amend Dresser’s employee

benefit plans, including Dresser Plan 750.   On July 16, 1999,

Halliburton agreed to assume the sponsorship of, adopt, and

continue Dresser Plan 750,5 along with other pension and welfare

benefit plans sponsored by Dresser as of January 1, 1999.

Included in this agreement was Halliburton’s promise to assume

“all powers, rights, duties, obligations, and liabilities of

Dresser” under the plans.   The agreement also amended the plans

to vest the administration of the plans in the Halliburton

Company Benefits Committee and the power to amend or terminate

the plans in the Chief Executive Officer of Halliburton.    The

agreement was executed by officers of Halliburton and was to

retroactively amend the Dresser plans effective January 1, 1999.

     On December 31, 2002, Halliburton decided to combine the

separate welfare benefit plans by merging the Halliburton Plan

     5
        After the merger with Dresser, Halliburton automatically
could have succeeded Dresser as the plan sponsor under the terms
of Dresser Plan 750. Dresser Plan 750 contains a provision
entitled “Employer Successor,” which states that “[a]ny successor
entity to an Employer, by merger, consolidation, purchase or
otherwise, shall be substituted hereunder for such Employer.”
The plan defines “employer” as the “company,” and “company” as
“Dresser Industries, Inc. (d.b.a. Dresser) or any successor
entity by merger, consolidation, purchase, or otherwise unless
such successor entity elects not to adopt the plan.” (emphasis
added). In light of the terms of the merger agreement, which
named Dresser as the surviving corporation to Halliburton N.C.
and provided that Dresser shall possess all rights and
obligations as the surviving corporation, Halliburton apparently
elected not to adopt the plan through the merger agreement. The
July 1999 agreement therefore was necessary to substitute
Halliburton as the plan sponsor and give Halliburton all of
Dresser’s rights and obligations under the plan.

                                11
with Dresser Plan 750 and renaming it the Halliburton Energy

Services, Inc. Welfare Benefits Plan (“HESI Plan”).   On January

1, 2003, Halliburton amended the HESI Plan so that various

subplans of Dresser Plan 750, including the Dresser Retiree

Medical Program, became constituent benefit programs of the HESI

Plan.    Under the HESI Plan, “the Company reserve[d] the absolute

right to amend the Plan and any or all Constituent Benefit

Programs.”

     In November 2003, over five years after the merger,

Halliburton, acting through its plan administrator, amended three

subplans of the Dresser Retiree Medical Program.6   As Halliburton

explained to the Dresser retirees:

     Halliburton has maintained separate retiree medical plans
     for Halliburton and Dresser retirees since the time of
     the merger in 1998. The goal of future changes to the
     Company’s retiree medical plans is to achieve parity for
     all retirees. The changes described below to the Dresser
     Retiree Medical Plan are intended to address the current
     variations between the Halliburton and the Dresser
     Retiree Medical Plans.

The amendments provided that effective January 1, 2004,

Halliburton’s contributions to the cost of medical coverage would

be frozen at the 2003 contribution amounts and that plan

participants would be responsible for any increase in the cost of

coverage.    The amendments also provided that effective January 1,

2005, Dresser retirees who had attained the age of sixty-five and

     6
        Halliburton amended Subplans 501, 901, and 902, all of
which were listed in the HESI Plan as constituent benefit
programs for Dresser retirees.

                                 12
were Medicare-eligible would be eligible for prescription drug

coverage only and that all other medical benefits would be

discontinued.   Halliburton’s prescription drug coverage included

a monthly subsidy of $22 per covered adult toward the cost of

prescription drug coverage,    which was the same subsidy provided

to Halliburton retirees with prescription drug only coverage.      In

its 2003 annual report, Halliburton estimated that the amendments

decreased Halliburton’s obligation by $93 million in future

medical benefit costs.

     On December 8, 2003, before the effective dates of the plan

amendments, Bryant, who had since retired, wrote Lesar, who had

since become Halliburton’s Chief Executive Officer and Chairman

of the Board.   In his letter, Bryant asked Lesar to withdraw the

November amendments, contending that the amendments violated

section 7.09(g)(i) of the merger agreement because no comparable

modifications were made to the plans for Halliburton’s similarly

situated active employees.    Lesar forwarded Bryant’s letter to

the Halliburton Company Benefits Committee (“Halliburton Benefits

Committee” or “Committee”) for consideration.    On January 21,

2004, Michele Mastrean (“Mastrean”), the Committee chairperson,

responded to Bryant by letter, stating that the Committee was

denying his request to withdraw the November 2003 amendments

because it had concluded that Halliburton’s amendments to the

retiree program were consistent with its obligations under the

merger agreement.   Specifically, the Committee determined that

                                 13
section 7.09(g)(i) only limited Halliburton’s otherwise

unfettered right to amend the Dresser Retiree Medical Program for

a period of three years from the effective date of the merger

agreement, as provided in section 10.07.   Accordingly, the

Committee concluded that there was nothing in the merger

agreement limiting its right to amend the Dresser Retiree Medical

Program.

B.   Procedural History

     On January 21, 2004, the same date as Mastrean’s letter to

Bryant, the Halliburton Benefits Committee initiated this

declaratory action in the district court against Bryant, James

Graves, and Phil Griffin, all of whom are participants in the

Dresser Retiree Medical Program, individually and as

representatives of a requested class.   The Committee’s complaint

requested certification of a class of all participants (the

“Retirees”) in the Dresser Retiree Medical Program, i.e., the so-

called “grandfathered employees,” and sought declarations that

(1) Halliburton’s November 2003 amendments to the Dresser Retiree

Medical Program are permissible and do not violate the terms or

provisions of the HESI Plan, the merger agreement, or ERISA; and

(2) the merger agreement, including section 7.09(g)(i), does not

limit Halliburton’s right to amend or terminate the Dresser

Retiree Medical Program.   The Committee invoked 29 U.S.C.

§ 1132(a)(1)(B), explaining that the “participants’ right to seek

                                14
judicial clarification of their right to future benefits arises

exclusively under [this section in] ERISA.”

     On May 12, 2004, the Retirees filed counterclaims and third-

party claims against the Halliburton Benefits Committee and

Halliburton (collectively, “Halliburton”), requesting, inter

alia, declaratory and injunctive relief prohibiting any

modifications to the Dresser Retiree Medical Program “to the

extent any such modifications are inconsistent with medical

benefit plans provided to similarly situated active Halliburton

employees, and specifically prohibiting the implementation of the

November 2003 amendments to the Dresser Retiree Medical Plan.”

     On August 18, 2004, the district court certified the class

to “consist[] of all people who were eligible to participate,

directly or indirectly, in the Dresser Retiree Medical Plan on

December 31, 1998.”   On September 10, 2004, the parties filed

cross-motions for summary judgment.   The Retirees’ motion for

partial summary judgment requested the district court to find as

a matter of law that the merger agreement requires Halliburton to

maintain the Dresser Retiree Medical Program in accordance with

section 7.09(g)(i) of the merger agreement.   Halliburton’s motion

for summary judgment asked the district court to declare that:

(1) the no-third-party-beneficiary clause in the merger agreement

bars the Retirees from enforcing the terms of the merger

agreement; (2) only the parties to the merger agreement and the

directors designated in section 10.07 could enforce the merger

                                15
agreement, and the three-year window within which the directors

designated in section 10.07 were entitled to enforce section

7.09(g)(i) had expired; and (3) the merger agreement imposes no

limitation on Halliburton’s right to amend or terminate the

Dresser Retiree Medical Program.       Halliburton also requested the

district court to dismiss the Retirees’ counterclaims with

prejudice.

     On December 20, 2004, the district court granted partial

summary judgment in favor of the Retirees.      The district court

found that the merger agreement modified the Dresser Retiree

Medical Program based on the signatures of the officers and the

approval of the agreement by the boards of directors and the

shareholders of both companies.    According to the district court,

even if the merger agreement itself did not amend the retiree

program, Halliburton “waited until November 2003 to change the

plans for former Dresser workers” and “Halliburton’s wait shows

that it recognized the validity of the plan amendments for

employees that stemmed from the merger.”      The district court

ordered that “Halliburton must maintain the Dresser Retiree

Medical Program for eligible participants and may adjust benefits

in that program only if it makes identical changes to benefits

for similarly situated active employees.”

     On December 23, 2004, at the request of Halliburton, the

district court entered a separate order entitled “final

judgment,” which stated that “[t]he partial judgment dated

                                  16
December 20, 2004, is severed and made final.”    On January 24,

2005, Halliburton filed a notice of appeal.

C.   Subsequent Proceedings

     On June 21, 2006, this court dismissed Halliburton’s appeal

for lack of jurisdiction.     See Halliburton Co. Benefits Comm. v.

Graves, No. 05-20088, 2006 WL 1751045 (5th Cir. June 21, 2006)

(unpublished).   We concluded that the district court’s partial

summary judgment order neither disposed of any particular claim,

nor evidenced the district court’s intention to sever any

specific claim, as required by FED. R. CIV. P. 21, but instead

decided a legal issue common to the claims of both parties.       Id.

at **2-3.   We decided that we therefore lacked jurisdiction to

decide the merits of the district court’s interlocutory order

because the district court’s order was not “final” within the

meaning of 28 U.S.C. § 1291.     Id. at *3.

     On June 23, 2006, the Retirees moved the district court to

amend its order on partial summary judgment to include the

certification language contemplated by 28 U.S.C. § 1292(b) to

facilitate immediate appellate review.    On June 26, 2006, the

district court amended its order to provide that it was “of the

opinion that [its order originally entered on December 20, 2004]

involves a controlling question of law as to which there is

substantial ground for difference of opinion and an immediate

appeal from the order may materially advance the ultimate

                                  17
termination of the litigation, as contemplated by 28 U.S.C.

§ 1292(b) and FED. R. APP. P. 5(a)(3).”   On July 5, 2006, within

ten days after the district court entered its amended order,

Halliburton filed an unopposed petition for permission to appeal,

which we granted.   See 28 U.S.C. § 1292(b); FED. R. APP. P.

5(a)(3).

                          II.   DISCUSSION

     On appeal, Halliburton argues that section 7.09(g)(i) of the

merger agreement does not limit its right to amend, modify, or

terminate the Dresser Retiree Medical Program.     Halliburton

contends that the district court’s contrary conclusion errs in

several respects.   First, Halliburton maintains that the merger

agreement did not effect a plan amendment to the Dresser Retiree

Medical Program because the agreement was not signed by Dresser’s

Vice President of Human Resources, thus failing to follow the

amendment procedure in Dresser Plan 750.     Second, Halliburton

asserts that under the plain language of the no-third-party-

beneficiary clause in section 10.07, the Retirees cannot enforce

any provision of the merger agreement, including section

7.09(g)(i).   Halliburton claims that even if the merger agreement

did in fact amend the Dresser Retiree Medical Program, only the

parties to the merger agreement and the directors designated in

section 10.07 were entitled to enforce section 7.09(g)(i), and

the three-year window within which the directors could do so has

                                 18
expired.   Finally, Halliburton argues that the district court’s

order requiring Halliburton to maintain the program amounts to an

impermissible vesting of the Retirees’ benefits because there is

no temporal limitation on Halliburton’s requirement to continue

benefits under the program.

     The Retirees respond that section 7.09(g)(i) amended the

Dresser Retiree Medical Program to limit the manner in which

Halliburton can make future amendments.   More specifically, the

Retirees claim that section 7.09(g)(i) gave them a “right of

nondiscrimination” such that Halliburton cannot modify or

terminate the retiree program unless it makes the same changes to

the plans for similarly situated active employees of Halliburton.

The Retirees argue that the merger agreement meets all of the

procedural requirements set forth in Dresser Plan 750 for making

a plan amendment to the Dresser Retiree Medical Program, and that

in any event, Halliburton ratified the plan amendment by its

actions following the merger with Dresser.   The Retirees further

contend that the no-third-party-beneficiary clause cannot deprive

them of their right to seek judicial clarification of the terms

of the program because it is ERISA that grants them that right

and not the merger agreement.   According to the Retirees,

Halliburton’s argument that any amendment effected a three-year

obligation enforceable only by the parties to the agreement and

certain directors is not supported by the text of section

7.09(g)(i), which does not contain any temporal limitation on the

                                19
amendment to the retiree program and does not disclaim

enforcement by plan participants.   Finally, the Retirees assert

that construing section 7.09(g)(i) as a plan amendment does not

constitute a vesting of their benefits because the amendment

still allows Halliburton to modify or terminate their benefits or

the plan as long as it makes the same changes to the benefits or

the plans of similarly situated active employees.

     We will address each argument in turn.   In making these

determinations, we review questions of law de novo.   See Nickel

v. Estes, 122 F.3d 294, 298 (5th Cir. 1997) (reviewing

interpretation of ERISA plan terms de novo); Arleth v. Freeport-

McMoran Oil & Gas Co., 2 F.3d 630, 633 (5th Cir. 1993) (reviewing

interpretation of merger agreement governed by Delaware General

Corporation Law de novo).

A.   Effect of the Merger Agreement on Dresser Retiree Medical
     Program

     1.   Consequences of the Merger Agreement

     Inherent in Halliburton’s argument that section 7.09(g)(i)

does not limit its right to amend the Dresser Retiree Medical

Program is the assumption that it possesses the right to amend or

terminate the retiree program in the first place.   Because this

right is not so apparent under the terms of the merger agreement,

we begin here.

     When companies merge under Delaware General Corporation Law,

the surviving corporation succeeds to both the rights and

                               20
obligations of the constituent corporation, including rights and

obligations of every nature, whether they be in contract or in

tort.   See DEL. CODE. ANN. tit. 8, § 259(a) (2001); 15 WILLIAM MEADE

FLETCHER, FLETCHER CYCLOPEDIA    OF THE   LAW   OF   PRIVATE CORPORATIONS

§§ 7082, 7115 (perm. ed., rev. vol. 1999) [hereinafter 15 FLETCHER

CYCLOPEDIA].   Such rights and obligations include those associated

with a company’s welfare benefit plan.                   Cf. EDWARD P. WELCH & ANDREW

J. TUREZYN, FOLK   ON THE   DELAWARE GENERAL CORPORATION LAW § 259.1 (2006)

(stating that the surviving or new corporation has “sole

possession of all rights and powers of the constituent

corporations”) (emphasis added); 15 FLETCHER CYCLOPEDIA § 7115

(noting that obligations assumed include those arising from

contracts of every kind).          One of the rights generally reserved

under a welfare benefit plan is the company’s right to amend or

terminate the plan.         See Curtiss-Wright Corp. v. Schoonejongen,

514 U.S. 73, 78 (1995) (noting that because ERISA does not create

any substantive entitlement to employer-sponsored health benefits

or any other kind of welfare benefits, “[e]mployers or other plan

sponsors are generally free under ERISA, for any reason at any

time, to adopt, modify, or terminate welfare plans”).

      Dresser Plan 750 included such a provision, reserving the

right for the company to amend or terminate its welfare benefit

programs, including the Dresser Retiree Medical Program, at any

time.   Halliburton did not, however, succeed to Dresser’s right

to amend or terminate its welfare plans via the merger agreement

                                           21
or Delaware law.    Rather, the merger agreement specified that

“the separate corporate existence of [Halliburton N.C.] shall

cease and [Dresser] shall continue as the Surviving Corporation.”

The agreement also explained that Dresser, as the surviving

corporation, shall succeed to “all the property, rights,

privileges, powers and franchises” and “all debts, liabilities

and duties” of the two merged corporations.    It was not until

January 1999, three months after the effective date of the

merger, that Halliburton, as the parent corporation, acquired

Dresser’s rights and obligations under its employee benefit

plans, including Dresser’s right to amend or terminate its

welfare benefit plans.    In a separate agreement dated July 16,

1999,7 Halliburton agreed to assume all of Dresser’s employee

benefit plans, including Dresser’s welfare plans governed by

Dresser Plan 750.    In addition to assuming the sponsorship of all

employee benefit plans, Halliburton acquired “all powers, rights,

duties, obligations, and liabilities of Dresser” under the plans,

which included, inter alia, Dresser’s right to amend or terminate

the plans.   It is this post-merger agreement--and not the merger

agreement itself–-that gives Halliburton the right to amend or

terminate the Dresser Retiree Medical Program.

     7
        Although Halliburton’s separate agreement to assume,
adopt, and amend Dresser’s employee benefit plans is dated July
16, 1999, the agreement specified that it was to be effective as
of January 1, 1999, which was approximately three months after
the effective date of the merger.

                                 22
     The post-merger agreement not only gave Halliburton a right

to amend or terminate the retiree program, but it also imposed a

concomitant obligation on Halliburton to maintain the program

according to its terms.     Cf. 15 FLETCHER CYCLOPEDIA § 7115 (noting

that obligations assumed include those arising from contracts of

every kind).     The terms of the retiree program are at the center

of this dispute, as the parties disagree over whether section

7.09(g)(i) of the merger agreement amended the retiree program in

such a way as to limit Halliburton’s otherwise unfettered right

to amend or terminate the plan.      We therefore must determine

whether section 7.09(g)(i) effectively amended the Dresser

Retiree Medical Program so that Halliburton may amend or

terminate the program only to the extent it makes the same

changes to the plans for its similarly situated active employees.

     2.     Merger Agreement as a Plan Amendment

            a.   Amendment by Plan Procedure

     In order to amend a welfare benefit plan governed by ERISA,

the employer must “provide a procedure for amending such plan,

and for identifying the persons who have authority to amend the

plan.”    29 U.S.C. § 1102(b)(3).    ERISA imposes no additional

formalities on plan amendments.      See Curtiss-Wright Corp., 514
U.S. at 80 (stating that ERISA “requires only that there be an

amendment procedure”).    In particular, there is no requirement

that a document claimed to be an amendment to a welfare plan be

                                    23
labeled as such.   See Horn v. Berdon, Inc. Defined Benefit

Pension Plan, 938 F.2d 125, 127 (9th Cir. 1991); see also JOHN F.

BUCKLEY, ERISA LAW ANSWER BOOK 5-7 (5th ed. 2006) [hereinafter ERISA

LAW ANSWER BOOK] (“[A]ny act that is directed to a provision of an

ERISA plan may be deemed to constitute a plan amendment even

though it does not recite that it is intended to amend the plan

and it is not included in a plan document.”).     Clearly then, a

provision in a merger agreement could amend a welfare plan, even

if it is not labeled as a plan amendment.    See Beck v. Dillard

Dep’t Stores, Inc., 1991 WL 72784, at *1 (E.D. La. May 1, 1991)

(unpublished) (stating that the companies “were at liberty to

clarify their existing Plan in the context of the merger” and

noting that the merged company’s severance policy was clarified

as part of the merger agreement); cf. Miss. Power Co. v. Nat’l

Labor Relations Bd., 284 F.3d 605, 622 (5th Cir. 2002)

(anticipating that an obligation to continue the retirees’

medical insurance coverage or to maintain the type or terms of

coverage might “be found in some other document”).     However, only

an amendment executed in accordance with the plan’s procedures is

effective.   Williams v. Plumbers & Steamfitters Local 60 Pension

Plan, 48 F.3d 923, 926 (5th Cir. 1995); cf. Curtiss-Wright Corp.,
514 U.S. at 85 (“[W]hatever level of specificity a company

ultimately chooses, in an amendment procedure or elsewhere, it is

bound to that level.”).

     The amendment procedure in Dresser Plan 750, the governing

                                 24
plan for the Dresser Retiree Medical Program, provides that

“[t]he Company may amend, modify, change, revise, discontinue or

terminate the Plan or any Benefit Agreement at any time by

written instrument signed by the Vice President, Human

Resources.”    Another provision in the plan reiterates that “[t]he

Company shall have overall responsibility for the establishment,

amendment and termination of any Benefit or of the Plan . . . .”

      When an amendment procedure says the plan may be amended by

“[t]he Company,” “principles of corporate law provide a ready-

made set of rules for determining, in whatever context, who has

authority to make decisions on behalf of a company.”                    Curtiss-

Wright Corp., 514 U.S. at 80.            In making this determination, we

are mindful that

      [t]he answer will depend on a fact-intensive inquiry,
      under applicable corporate law principles, into what
      persons or committees within [the corporation] possessed
      plan amendment authority, either by express delegation or
      impliedly, and whether those persons or committees
      actually approved the new plan provision . . . . If the
      new plan provision is found not to have been properly
      authorized when issued, the question would then arise
      whether any subsequent actions . . . served to ratify the
      provision ex post.

Id. at 85 (internal citation omitted).

      Under corporate law principles, officers generally have

authority to take action on behalf of the company when that

action is approved by the board of directors.                   See 2 WILLIAM MEADE

FLETCHER, FLETCHER CYCLOPEDIA   OF THE   LAW   OF   PRIVATE CORPORATIONS § 437

(perm. ed., rev. vol. 2006) [hereinafter 2 FLETCHER CYCLOPEDIA]

                                          25
(stating that an officer’s authority as an agent for the

corporation “may be implied from [his] conduct and the

acquiescence of the directors”).      Drawing on these principles, we

have no trouble concluding that section 7.09(g)(i) of the merger

agreement amended the Dresser Retiree Medical Program to provide

that Halliburton must maintain the retiree program for eligible

participants except to the extent that any modifications are

consistent with changes in the medical plans provided by

Halliburton for similarly situated active employees.     The

agreement was signed by Bradford, Dresser’s Chief Executive

Officer and Chairman of the Board of Directors, and approved by

Dresser’s Board of Directors.   These individuals had authority to

act on behalf of the company, and their actions effectively

amended the retiree program.    See id. § 439 (“A resolution of the

board of directors is sufficient to show express authority in a

corporate agent or officer . . . .”).

     Halliburton nevertheless maintains that section 7.09(g)(i)

could not have amended the retiree program because the merger

agreement was not signed by Dresser’s Vice President of Human

Resources.   Halliburton contends that “an act by ‘the Company’ is

not sufficient; Dresser’s procedure requires a writing by the

Vice President of Human Resources.”     Halliburton misreads

Dresser’s amendment provision, which vests the authority “to

amend, modify, change, discontinue or terminate” the benefit

programs in the company itself and not in the Vice President of

                                 26
Human Resources.   The reference to the Vice President constitutes

a delegation of authority for one way in which “[t]he Company”

may amend the plan.   It does not, however, constitute the only

way in which the company may amend the plan.    Cf. id. § 495

(“[T]he appointment of such an officer does not mean that the

board has completely abdicated its authority.”) (citing In re

Walt Disney Co. Derivative Litig., 2005 WL 2056651, at *49 n.574

(Del. Ch. Aug. 9, 2005) (unpublished)).   Under corporate law

principles, Dresser could revoke its delegation of authority and

act to amend the plan in some other manner.    See id. § 437.10 (“A

principal who employs an agent always retains the power to revoke

the agency.”); id. § 495 (“[T]he board constitutes the

corporation and does not . . . exercise a delegated authority.”).

     This interpretation of the Dresser amendment provision is

consistent not only with corporate law principles, but also with

other provisions in the plan.   Section 6.14, entitled “Action by

the Company,” provides that

     [a]ny action by the Company pursuant to any of the
     provisions of this Plan shall be evidenced by a
     resolution of its Board of Directors over the signature
     of its secretary or assistant secretary, by written
     direction of the Chairman of the Board of Directors, or
     by written instrument executed by any person authorized
     by the Board to take such action.

The plan amendment procedure essentially designated the latter--

i.e., “written instrument executed by any person authorized by

the Board to take such action”--as the way in which the company

could amend the plan.   It stated that “[t]he Company may amend

                                27
. . . the Plan or any Benefit Agreement at any time by written

instrument signed by the Vice President.”   However, as evidenced

by the plan provision on delegation of responsibility, the

company had the authority not only to “delegate, from time to

time, all or any part of its responsibilities under the Plan to

such person or persons as it may deem advisable,” but also to

“revoke any such delegation or responsibility.”   Put another way,

a “written instrument executed by any person authorized by the

Board to take such action” was only one of the ways in which

Dresser could act to amend the plan.   Dresser always had the

authority to revoke the Vice President’s authority and to

evidence its action to amend the plan in some other authorized

way, such as by resolution of the board of directors or by

written direction of the chairman of the board of directors.

Accordingly, Dresser’s Board of Directors’ approval and

Bradford’s signature on the merger agreement, as the Chairman of

the Board of Directors, were more than sufficient to constitute

an action by the company to amend the plan.   Cf. ERISA LAW ANSWER

BOOK 5-7 (“[I]t would be difficult to argue that an action by the

board of directors of an entity would not, even in the absence of

specific authority, constitute a valid act of amendment of the

plan.”).

     Halliburton’s position that Dresser could amend its welfare

plans only through a signed writing of the Vice President of

Human Resources is especially curious in light of its own

                               28
actions.   On at least two occasions following the merger,

Halliburton purportedly amended Dresser Plan 750 without a

written instrument signed by the Vice President of Human

Resources.   First, on July 16, 1999, Halliburton amended Dresser

Plan 750 to name the Halliburton Company Benefits Committee as

the plan administrator and to vest the power to amend or

terminate the welfare plans in the Chief Executive Officer of

Halliburton.    That amendment was signed by Lesar and not by the

Vice President of Human Resources.    Similarly, on December 31,

2002, Halliburton made several amendments to Dresser Plan 750,

none of which was signed by the Vice President.    Thus, as

illustrated by its own actions, even Halliburton has recognized

that under the amendment provision in Dresser Plan 750, the

Dresser welfare plans may be amended by procedures other than a

writing signed by the Vice President of Human Resources.

           b.    Amendment by Ratification

     In any event, even if the Vice President’s signature had

been required for section 7.09(g)(i) to amend the retiree

program, Halliburton’s subsequent actions served to ratify the

provision ex post.    See Curtiss-Wright Corp., 514 U.S. at 85 (“If

the new plan provision is found not to have been properly

authorized when issued, the question would then arise whether any

subsequent actions, such as the executive vice president’s

letters informing respondents of the termination, served to

                                 29
ratify the provision ex post.”); see also 2A WILLIAM MEADE FLETCHER,

FLETCHER CYCLOPEDIA   OF THE   LAW   OF   PRIVATE CORPORATIONS § 764.10 (perm. ed.,

rev. vol. 2001) [hereinafter 2A FLETCHER CYCLOPEDIA] (“A corporation

may bind itself by ratifying an act done by an agent of its

subsidiary company.”).           Under the doctrine of ratification, “[a]

corporation may render itself liable for unauthorized acts of its

officers by subsequently ratifying them.”                 2 FLETCHER CYCLOPEDIA

§ 434; see Depenbrock v. Cigna Corp., 389 F.3d 78, 83 (3d Cir.

2004) (“The doctrine of ratification provides that an improperly

authorized amendment may be ratified ex post by subsequent

acts.”).

      Halliburton ratified section 7.09(g)(i) as an amendment to

the Dresser Retiree Medical Program in at least two ways.8

First, the shareholders of Halliburton and Dresser approved the

merger agreement on June 25, 1998, four months after the

      8
         Halliburton argues that this court cannot consider “parol
evidence” in determining whether section 7.09(g)(i) amended the
Dresser Retiree Medical Program. Halliburton is correct that
extrinsic evidence is not admissible to interpret unambiguous
plan documents. See ERISA LAW ANSWER BOOK 2-8 (noting that “[t]he
unambiguous written provisions of a plan must control, and
extrinsic evidence cannot be introduced to vary express terms of
a plan”).
        However, evidence that tends to show subsequent
ratification of a plan amendment is admissible. See 2A FLETCHER
CYCLOPEDIA § 778 (“Where the act of a corporate officer or agent
was unauthorized or irregular, any competent and material
evidence is admissible which tends to show a subsequent
ratification by officers having authority to ratify or by
shareholders where they may ratify. . . . If the ratification was
implied, the conduct of the corporate officers and directors
tending to show implied ratification is admissible.”).

                                              30
agreement was executed, thereby ratifying the amendment to the

extent it was unauthorized.    See 2A FLETCHER CYCLOPEDIA § 764 (“The

shareholder may ratify unauthorized or irregular acts of the

directors or of other corporate officers . . . by vote at a

shareholders’ meeting . . . .”); cf. 2 FLETCHER CYCLOPEDIA § 437

(noting that the corporation acts through the action of its

shareholders and managing board).

     Second, Halliburton administered its obligations under the

Dresser Retiree Medical Program consistent with section

7.09(g)(i).    In the five years following the merger agreement,

Halliburton maintained separate retiree medical plans for

Halliburton and Dresser retirees, and admitted to doing so in a

November 2003 letter to the Retirees.     Prior to November 2003,

Halliburton never attempted to amend the retiree program in a way

that was inconsistent with its obligation under section

7.09(g)(i).    In fact, Halliburton’s correspondence on the

provision shows that the company was mindful of its obligations

under the merger agreement.    For example, Colgan’s February 16,

1999, letter to Ables, one of the Dresser retirees, noted that

Halliburton was mindful of its obligation to maintain the retiree

medical plan, except to the extent it made identical

modifications to the medical plans for similarly situated active

employees.    Therefore, to the extent it is necessary,

Halliburton’s ex post actions ratified section 7.09(g)(i) as a

valid plan amendment.

                                 31
B.   Enforceability of Section 7.09(g)(i) as a Plan Amendment

     1.   Effect of the No-Third-Party-Beneficiary Clause

     Halliburton maintains that under the plain language of the

no-third-party-beneficiary clause in section 10.07 of the merger

agreement, the Retirees cannot enforce any provision of the

agreement, including section 7.09(g)(i).   Halliburton argues that

even assuming the agreement amended the Dresser Retiree Medical

Program, only the parties to the merger agreement and the

directors designated in section 10.07 were entitled to enforce

section 7.09(g)(i), and the three-year window within which the

directors could do so has expired.

     We cannot agree.   First, Halliburton’s contention that the

Retirees are precluded by section 10.07 from enforcing section

7.09(g)(i) wrongfully equates a plan participant’s enforcement of

a plan right under ERISA with a third party’s enforcement of a

provision in a contract.   The Retirees are not seeking to enforce

a breach of contract claim under the merger agreement.   As they

recognize, principles of preemption prevent them from doing so.

Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 62 (1987) (holding

that a contract claim is preempted by ERISA if the claim

“relate[s] to [an] employee benefit plan”).   Instead, they seek a

clarification of their rights to future benefits under the terms

of the retiree program.    See 29 U.S.C. § 1132(a)(1)(B) (stating

that a civil action may be brought by a participant or

                                 32
beneficiary under ERISA “to enforce his rights under the terms of

the plan, or to clarify his rights to future benefits under the

terms of the plan”).    The detailed provisions of § 1132(a)(1)(B)

“set forth a comprehensive civil enforcement scheme” that was

“intended to be exclusive.”    Pilot Life Ins. Co. v. Dedeaux, 481
U.S. 41, 54 (1987).    Simply put, enforcement of a plan’s

provisions, including any amendments thereto, falls exclusively

in ERISA’s remedial scheme.    See Morales v. Pan Am. Life Ins.

Co., 914 F.2d 83, 87 (5th Cir. 1990) (“ERISA’s civil enforcement

provision creates an exclusive remedial scheme focusing on the

terms of the plan.”).    To adopt Halliburton’s argument that a

provision in a contract, or more specifically, a no-third-party-

beneficiary clause, can trump rights prescribed by ERISA would

fly in the face of the exclusive remedial scheme prescribed by

Congress for plan participants and beneficiaries to enforce

rights under employee benefit plans.9   Cf. Dallas County Hosp.

     9
        Halliburton relies on two cases, neither of which is
controlling here. First, Halliburton cites In re Fairchild
Indus., Inc. & GMF Invs., Inc., ERISA Litig., 768 F. Supp. 1528,
1533 (N.D. Fla. 1990), a case in which the district court
rejected the plaintiff’s argument that a purchase agreement
constituted a plan amendment “[b]ecause ERISA prohibits the
amendment of an employee benefit plan through informal written
documents, or by any other means except as specified in the plan
documents themselves . . . .” The court noted that its
conclusion was “buttressed by the contracting parties’ clearly
expressed intent not to create any third party rights by
executing the agreement.” Id. at 1533.
       The district court’s reliance on the no-third-party-
beneficiary clause was not dispositive to its holding; rather, it
relied on the informality of the purported amendment and the fact
that the amendment was not executed in accordance with the plan

                                 33
Dist. v. Assocs.’ Health & Welfare Plan, 293 F.3d 282, 289 (5th

Cir. 2002) (stating that whether a party is a beneficiary under a

contract, which is not itself an ERISA plan, “is of no relevance

in determining whether it is an ERISA beneficiary”).

     Second, Halliburton’s claim that only certain parties were

entitled to enforce section 7.09(g)(i) for a three-year period is

not supported by the express language in the merger agreement.10

Section 10.07 provides that notwithstanding its prohibition on

third-party beneficiaries, certain directors are entitled “to

documents, concluding that “the Purchase Agreement could not
legally operate to amend the plan documents.” Id. Such is not
the case here, where the parties executed section 7.09(g)(i) in
accordance with the amendment procedures in Dresser Plan 750. In
addition, to the extent In re Fairchild holds that ERISA imposes
formalities on plan amendments, the Supreme Court rejected such
an approach in Curtiss-Wright Corp., 514 U.S. 73.
       Moreover, we cannot give any weight to Halliburton’s
reliance on LaFata v. Raytheon Co., 147 F. App’x 258, 261 (3d
Cir. 2005) (unpublished), because that decision has nothing to do
with amendments to an ERISA plan.
     10
        Before the district court, Halliburton initially took
the position that section 7.09(g)(i) of the merger agreement had
in fact amended the plan, but that it had done so for only a
three-year period. See 8 Rawle 292-306, Am. Compl. ¶ 16 (stating
that “[c]ertain provisions of the Halliburton/Dresser Merger
Agreement described permissible amendments to Dresser’s welfare
benefit programs during a three-year period following the
effective date of the merger”); id. ¶ 31 (“The Merger Agreement
contains certain provisions that limited Halliburton’s ability to
change or terminate the Dresser Retiree Program benefits for a
period of three years.”); id. ¶ 33 (“As a result of these
provisions [including section 7.09(g)(i)], Halliburton committed
to maintain the Dresser Retiree Program, save for changes
consistent with changes to the benefits of ‘similarly situated
active employees,’ for a period of three years.”). In front of
this court, however, Halliburton has argued that the merger
agreement did not amend the retiree program, but that if it did,
it did so for only three years pursuant to section 10.07.

                               34
enforce the provisions of Sections 7.09 and 7.13 on behalf of

[Dresser’s] officers, directors, and employees” during the three-

year period following the effective date of the merger.    The

problem with Halliburton’s argument is that it does not give

effect to the language in section 7.09(g)(i), the provision

directed at the retiree medical plan.   The explicit language in

section 7.09(g)(i) does not contain any temporal limitation on

its enforcement and does not disclaim enforcement by plan

participants.   Rather, it simply states that Halliburton shall

cause the Surviving Corporation to take all corporate action

necessary to maintain the Dresser Retiree Medical Program,

“except to the extent that any modifications thereto are

consistent with changes in the medical plans provided by

[Halliburton] and its subsidiaries for similarly situated active

employees.”

     A comparison of section 7.09(g)(i) with the section

succeeding it, section 7.09(h), provides further support that the

parties did not intend to impose any enforcement limitations on

the retiree program, other than the one expressly provided for in

section 7.09(g)(i).   Section 7.09(h) requires Halliburton to

provide Dresser employees with benefits comparable to similarly

situated Halliburton employees “until the third anniversary of

the effective time” of the merger agreement.   Section 7.09(h) is

significant because it illustrates that the parties knew how to

limit the duration of Halliburton’s obligation for Dresser

                                35
employees, in connection with section 10.07 of the agreement.     In

drafting the sections in 7.09, the parties carefully drew a

distinction between employees and retirees.    To construe

“employees” in section 10.07 to include “retirees” in order to

impose a three-year limitation on the obligations under the

retiree program would render section 7.09(g)(i) meaningless and

unnecessary in light of section 7.09(h).   We decline to read a

three-year requirement into section 7.09(g)(i).

     2.   Consequences of the Plan Amendment

     Finally, Halliburton misconstrues section 7.09(g)(i) as a

grant of “permanent benefits.”   Halliburton argues that section

7.09(g)(i) violates the prohibition in the merger agreement on

vested benefits and that, in any event, there is no clear

intention to vest benefits under section 7.09(g)(i) as required

by Spacek v. Mar. Ass’n, 134 F.3d 283, 293 (5th Cir. 1998),

abrogated on other grounds by, Cent. Laborers’ Pension Fund v.

Heinz, 541 U.S. 739 (2004).   Section 7.09(g)(i) states that

Halliburton must maintain the Dresser Retiree Medical Program,

“except to the extent that any modifications thereto are

consistent with changes in the medical plans provided by

[Halliburton] and its subsidiaries for similarly situated active

employees.”   To argue that this provision constitutes vesting

amounts to a misunderstanding of what it means to “vest” a right

or benefit under ERISA.   An employer “vests” a benefit under

                                 36
ERISA when it intends to confer unalterable and irrevocable

benefits on its employees, and it does so by using clear and

express language.   See Spacek, 134 F.3d at 293 (stating that

“courts may not lightly infer an intent on the part of a plan to

voluntarily undertake an obligation to provide vested,

unalterable benefits”) (internal alterations, quotation marks,

and citation omitted).   Nothing in section 7.09(g)(i) requires

Halliburton to maintain the retiree program indefinitely; rather,

Halliburton is free, at any time and for any reason, to amend or

terminate the program, as long as it does the same for its

similarly situated active employees.11   Because Halliburton may

modify or terminate the program, the benefits have not vested.

See Murphy v. Keystone Steel & Wire Co., 61 F.3d 560, 565 (7th

Cir. 1995) (“If a contract provides that benefits can be

terminated, then those benefits do not vest.”).

     Nor is it problematic that section 7.09(g)(i) precludes

future amendment or termination of the plan, except as consistent

with the provision’s terms.   Employers generally are free under

     11
        Accordingly, section 7.09(g)(i) does not violate the
other terms in the merger agreement. Sections 4.13(j) and
5.13(j) of the agreement make clear that the merger agreement
does not “create or give rise to any additional vested rights.”
Under section 6.02(a)(i) and (b)(i) of the agreement, Dresser and
Halliburton covenanted not to amend any employee benefit plans to
vest any employee benefits under such plans. That section
7.09(g)(i) amended the Dresser Retiree Medical Program is not
inconsistent with these provisions because the amendment does not
give rise to vested rights, but merely limits the way in which
Halliburton can amend or terminate the retiree program.

                                37
ERISA to modify or terminate plans, but if the plan sponsor cedes

its right to do so, it will be bound by that contract.         See

Vasseur v. Halliburton Co., 950 F.2d 1002, 1006 (5th Cir. 1992);

see also Hughes v. 3M Retiree Med. Plan, 281 F.3d 786, 790 (8th

Cir. 2002) (“An employer offering welfare benefits may

unilaterally modify or terminate benefits at the employer’s

discretion, so long as the employer has not contracted an

agreement to the contrary.”); 2 MICHAEL J. CANAN, QUALIFIED RETIREMENT

PLANS § 24:134 (2006) (“[Welfare benefit plans] can be amended or

terminated by the employer provided there is no contractual

obligation that prevents such an amendment.”).       This court has

recognized that a reservation-of-rights clause in a plan

document, which allows a company to amend or terminate a plan at

any time, “cannot vitiate contractually vested or bargained-for

rights.   To conclude otherwise would allow the company to take

away bargained-for rights unilaterally.”      Int’l Ass’n of

Machinists & Aerospace Workers v. Masonite Corp., 122 F.3d 228,

233 (5th Cir. 1997) (emphasis added).

     We decline to allow Halliburton to unilaterally take away

the “bargained-for rights” that Dresser and Halliburton

negotiated and made on the retiree program as part of their

merger agreement.   The parties were free to impose contractual

obligations on the right to amend or terminate the Dresser

Retiree Medical Program, and they did.     See id.   Because of these

limitations, Halliburton cannot alter the retiree program, except

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as consistent with the plan as amended by section 7.09(g)(i).

                        III.   CONCLUSION

     For the foregoing reasons, we AFFIRM the Amended Order on

Partial Summary Judgment of the district court.

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