EXHIBIT 10.5
WASTE MANAGEMENT, INC.
EXECUTIVE OFFICER SEVERANCE POLICY
1. Policy
     It is the policy of the Board of Directors (the “Board”) of Waste
Management, Inc. (the “Company”) that the Company shall not enter into a Future
Severance Arrangement with an Executive Officer that provides for Benefits in an
amount that exceeds 2.99 times the Executive Officer’s then current base salary
and target bonus, unless such Future Severance Arrangement receives stockholder
approval.
2. Definitions
     For the purposes of this Policy, the following terms shall have the
following meanings:
“Benefits” means

  (i)   cash amounts payable by the Company in the event of termination of the
Executive Officer’s employment;     (ii)   the present value of benefits or
perquisites provided for periods after termination of employment (but excluding
benefits or perquisites provided to employees generally);

     The term “Benefits” includes lump-sum payments and the estimated present
value of any periodic payments made or benefits or perquisites provided
following the date of termination.
     Notwithstanding the foregoing, the term “Benefits” does not include:

  (i)   payments of salary, bonus or performance award amounts that had accrued
at the time of termination;     (ii)   payments based on accrued qualified and
non-qualified deferred compensation plans, including retirement and savings
benefits;     (iii)   any benefits or perquisites provided under plans or
programs applicable to employees generally;     (iv)   amounts paid as part of
any employment agreement intended to “make-whole” any forfeiture of benefits
from a prior employer;     (v)   amounts paid for services following termination
of employment for a reasonable consulting agreement for a period not to exceed
one year;     (vi)   amounts paid for post-termination covenants (such as a
covenant not to compete);     (vii)   the value of accelerated vesting or
payment of any outstanding equity-based award;     (viii)   any payment that the
Board or any committee thereof determines in good faith to be a reasonable
settlement of any claim made against the Company.

 

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     “Employment Agreement” means an agreement between the Company (or one of
its subsidiaries) and an Executive Officer pursuant to which the Executive
Officer renders services to the Company (or one of its subsidiaries) as an
employee.
     “Executive Officer” means any person who is or becomes at the time of
execution of a Future Severance Agreement an officer of the Company or a
subsidiary who is required to file reports pursuant to Section 16 of the
Securities Exchange Act of 1934, as amended.
     “Future Severance Agreement” means an Employment Agreement or a Severance
Agreement providing for the payment of Benefits entered into after the effective
date of this Policy, and includes any renewal, material modification or
extension to an Employment Agreement or Severance Agreement in effect as of the
date of this Policy, to the extent such renewals, material modifications or
extensions require written agreement by the Executive Officer.
     “Severance Agreement” means an agreement between the Company (or one of its
subsidiaries) and an Executive Officer related to such Executive Officer’s
termination of employment with the Company and its subsidiaries.
3. Administration
     The Board delegates to the Compensation Committee full authority to make
determinations regarding the interpretation of the provisions of this Policy, in
its sole discretion, including, without limitation, the determination of the
value of any non-cash items, as well as the present value of any cash or
non-cash benefits payable over a period of time.
4. Amendment
     Consistent with the Company’s compensation philosophy and practice, the
Board of Directors retains the right to amend or modify this Policy at any time
in its sole discretion that such action would be in the best interest of the
Company and its stockholders; provided, however, that any such action shall be
promptly disclosed.
5. General
     If the Compensation Committee determines that it would be in the best
interest of stockholders to enter into a Future Severance Agreement with an
Executive Officer pursuant to which the present value of the proposed Benefits
would exceed 2.99 times the Executive Officer’s then current base salary and
target bonus, the Board of Directors may seek stockholder approval of such
Future Severance Agreement after the material terms have been agreed upon but
the payment of any Benefits in excess of the foregoing limits will be contingent
upon such stockholder approval.