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                                                                    EXHIBIT 10.5


                                 SOUTHDOWN, INC.

                  SPECIAL SEVERANCE PLAN FOR SALARIED EMPLOYEES

            As Amended and Restated Effective as of January 31, 2000


1.   Employees Covered. The Special Severance Plan for Salaried Employees (the
     "Plan"), formerly known as the Company's Special Severance Program, shall
     cover all salaried employees of SOUTHDOWN, INC. (the "Company"), and its
     subsidiaries employed in the corporate headquarters of the Company, other
     than employees covered by individual severance or employment agreements, or
     who, prior to a Change in Control, are designated as participants in
     another severance plan of the Company. For purposes of this Plan, the term
     "salaried employees" shall mean those employees who are permanent full-time
     employees and who are compensated with a salary of a set amount for a
     standard number of hours per pay period rather than hourly. Individuals in
     this category will include all individuals designated "exempt" from
     provisions of the Fair Labor Standards Act as well as those individuals
     designated "non-exempt" under that Act who are paid on a salaried basis,
     even though eligible for overtime payments.

2.   Condition to Benefits Being Payable. No benefits shall be payable under the
     Plan unless (i) there shall have been a Change in Control and (ii) the
     salaried employee's employment with the Company and its subsidiaries is
     terminated within twelve months after the date of the Change in Control
     under the circumstances described in Section 3. For purposes of this Plan,
     a Change in Control shall be conclusively deemed to have occurred if (and
     only if) any of the following shall have taken place: (i) a change in
     control is reported by the Company in response to either Item 6(e) of
     Schedule 14A of Regulation 14A promulgated under the Securities Exchange
     Act of 1934, as amended ("Exchange Act"), or Item 1 of Form 8-K promulgated
     under the Exchange Act, or any similar reporting requirement hereafter
     promulgated by the Securities and Exchange Commission; (ii) any person,
     entity or group (as such terms are used in Sections 13(d) and 14(d)(2) of
     the Exchange Act) other than an employee benefit plan sponsored by the
     Company is or becomes the "beneficial owner" (as defined in Rule 13d-3
     under the Exchange Act), directly or indirectly, of securities of the
     Company representing forty percent or more of the combined voting power of
     the Company's then outstanding securities (as determined under paragraph
     (d) of Rule 13d-3 promulgated under the Exchange Act, in the case of rights
     to acquire common stock); or (iii) following the election or removal of
     directors, a majority of the Board consists of individuals who were not
     members of the Board two years before such election or removal, unless the
     election of each director who was not a director at the beginning of such
     two-year period has been approved in advance by directors representing at
     least a majority of the directors then in office who were directors at the
     beginning of the two-year period.

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3.   Benefits. A salaried employee whose employment with the Company and its
     subsidiaries is terminated within twelve months after the date of a Change
     in Control and who satisfies the requirements of Paragraph A or B below
     shall receive the following benefits:

     A. A salaried employee (i) who immediately prior to the Change in Control
        of the Company was employed at a salary grade of 13, 14 or 15 or
        equivalent grades under a successor salary grade system and (ii) whose
        employment with the Company and its subsidiaries is terminated by the
        Company for reasons other than death, Retirement, Disability, or Cause,
        or by the employee for Good Reason, shall be entitled to receive from
        the Company or its subsidiaries a lump sum payment equal to the greater
        of (x) two weeks of base salary (as in effect immediately prior to the
        Change in Control of the Company) for each year of service with the
        Company or any subsidiary or (y) six months of base salary (as in effect
        immediately prior to the Change in Control of the Company), as well as
        periodic amounts equal to his or her base salary (as in effect
        immediately prior to the Change in Control of the Company) for up to six
        months from the date of termination of employment or until the employee
        begins new employment, whichever is sooner. An employee eligible for
        benefits under this Paragraph A shall continue to be covered under the
        medical, dental, life insurance and disability insurance programs in
        effect and applicable to the employee immediately prior to the time of
        the Change in Control of the Company for twelve months from the date of
        termination of employment or until the employee begins new employment,
        whichever occurs first. The Company or its subsidiaries will pay the
        employee his or her base salary (as in effect immediately prior to the
        Change in Control) until the date six months after termination of
        employment with the Company and its subsidiaries less any amounts the
        employee earns from subsequent employment during this period.

     B. A salaried employee (i) who is not covered by clause (i) of the first
        sentence of Paragraph A above and (ii) whose employment with the Company
        and its subsidiaries is terminated by the Company for reasons other than
        death, Retirement, Disability, or Cause shall be entitled to receive
        from the Company or its subsidiaries a lump sum payment equal to the
        lesser of (x) one year of base salary (as in effect immediately prior to
        the Change in Control of the Company) or (y) the greater of (A) two
        weeks of base salary (as in effect immediately prior to the Change in
        Control of the Company) for each year of service with the Company or any
        subsidiary or (B) twelve weeks of base salary (as in effect immediately
        prior to the Change in Control of the Company), as well as periodic
        amounts equal to his or her base salary (as in effect immediately

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        prior to the Change in Control of the Company) for up to three months
        from the date of termination of employment or until the employee begins
        new employment, whichever occurs first. An employee eligible for
        benefits under this Paragraph B shall continue to be covered under the
        medical, dental, life insurance and accident benefit programs in effect
        and applicable to the employee immediately prior to the time of the
        Change in Control of the Company for up to three months from the date of
        termination of employment or until the employee begins new employment,
        whichever occurs first.

     C. (i)  A salaried employee qualifying under Paragraph A shall also be
             entitled to individual outplacement services for one year following
             termination at Company expense in an amount not to exceed $5,000.

        (ii) A salaried employee not covered by (i) above shall be entitled to
             group outplacement services according to the Company's established
             and customary practices as in effect prior to the Change in
             Control.

     D. Benefits provided to any employee under this Section 3 shall be reduced
        by any severance payments made by the Company or its subsidiaries to
        such employee otherwise than pursuant to this Plan but only if such
        payments are denominated as severance payments and are essentially
        salary continuation, whether paid on a lump sum or periodic basis.
        Unemployment compensation benefits are not deemed to be payments made by
        the Company or is subsidiaries.

     E. For purposes of this Plan, "Retirement" shall mean termination of
        employment in accordance with the retirement policy of the Company or
        the subsidiary for which the employee works as in effect immediately
        prior to a Change in Control; "Disability" shall mean the absence of an
        employee from his or her duties with the Company or its subsidiaries on
        a full-time basis for six consecutive months and the failure of the
        employee to return to the full-time performance of his or her duties
        within thirty days after written notice of termination is given to the
        employee; and "Cause" shall mean the willful and continued failure by an
        employee to substantially perform his or her duties with the Company or
        its subsidiaries (other than any such failure resulting from the
        employee's incapacity due to physical or mental illness) after a demand
        for substantial performance is delivered to the employee by his or her
        appropriate supervisor, the willful engaging by the employee in conduct
        which is demonstrably and materially injurious to the Company or its
        subsidiaries, monetarily or otherwise or the employee's failure to
        comply with the Company's Code of Business Conduct.

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        For purposes of this Plan, "Good Reason" shall mean a material reduction
        of an employee's total compensation or benefits below the level in
        effect immediately prior to a Change in Control.

4.   Administration. The general administration of the Plan, and the
     responsibility for carrying out the provisions hereof, shall be placed in
     an Administrative Committee appointed by the Board of Directors of the
     Company, which committee shall initially be the Compensation and
     Development Committee of the Company's Board of Directors. The
     Administrative Committee shall have complete control of the administration
     of the Plan, with all powers necessary to enable it to properly carry out
     its duties in that respect. Subject to the limitations of this Section 4,
     the Administrative Committee from time to time may establish such
     supplemental rules and regulations for the administration of the Plan and
     the transaction of its business as it deems necessary.

5.   Claims Procedure

     A. All claims for benefits shall be in writing and shall be filed with the
        Administrative Committee or its designee.

     B. If the Administrative Committee or its designee wholly or partially
        denies a former employee's claim for benefits, the Administrative
        Committee shall give the claimant written notice within sixty (60) days
        after the Plan's receipt of the claim setting forth:

        (i)   the specific reason(s) for the denial;

        (ii)  specific reference to pertinent Plan provisions on which the
              denial is based;

        (iii) a description of any additional material or information which must
              be submitted to perfect the claim, and an explanation of why such
              material or information is necessary; and

        (iv)  an explanation of the Plan's review procedure.


     C. In the event of a benefit claim denial, the Company shall appoint a
        person who is not a member of the Administrative Committee to serve as
        Claim Reviewer. The person designated as the Claim Reviewer shall be
        reasonably acceptable to the claimant. The claimant shall have sixty
        (60) days after the day on which such written notice of denial is handed
        or mailed to him or her by the Administrative Committee in which to
        apply (in person or by authorized representative) in writing to the
        Claim Reviewer for a full and fair review of the denial of his or her
        claim. In

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        connection with such review, the claimant (or his or her representative)
        shall be afforded a reasonable opportunity to review pertinent
        documents, and may submit issues and comments in writing. The Claim
        Reviewer shall arrange to meet personally with the claimant and/or
        representative within thirty (30) days after the Claim Reviewer's
        receipt of such written request for review for the purpose of hearing
        the claimant's contentions and receiving such relevant evidence as the
        claimant may wish to offer.

     D. The Claim Reviewer shall issue his decision on review within sixty (60)
        days after meeting with the claimant or claimant's personal
        representative, unless in the sole discretion of the Claim Reviewer
        special circumstances require an extension to not later than one hundred
        twenty (120) days after such meeting. The decision shall be in writing
        and shall set forth specific reasons for the decision and specific
        references to pertinent Plan provisions on which the decision is based.

     E. The Company or its subsidiary shall pay the costs and expenses,
        including without limitation, reasonable attorneys' fees, incurred by an
        employee in seeking to enforce his or her rights under the Plan.

6.   Employment of Professional Assistance. The Administrative Committee is
     empowered, on behalf of the Plan, to engage accountants, legal counsel and
     such other personnel as it deems necessary or advisable to assist it in the
     performance of its duties under the Plan. The functions of any such persons
     engaged by the Administrative Committee shall be limited to the specific
     services and duties for which they are engaged, and such persons shall have
     no other duties, obligation or responsibilities under the Plan. Such
     persons shall exercise no discretionary authority or discretionary control
     respecting the management of the Plan. All reasonable expenses thereof
     shall be borne by the Company.

7.   Indemnification of Members of Administrative Committee. To the extent not
     insured against by an insurance company pursuant to the provisions of any
     applicable insurance policy and to the extent permitted by law, the Company
     shall indemnify and hold harmless each member of the Administrative
     Committee against any personal liability or expense incurred by him as a
     result of any act or omission in his capacity as a member of the
     Administrative Committee, except for his own gross negligence or willful
     misconduct.

8.   Controlling Law. This Plan shall be construed and enforced according to the
     internal laws of the State of Texas to the extent not preempted by federal
     law, which shall otherwise control.

9.   Employment Status. This Plan does not constitute a contract of employment
     or impose on the Company any obligation to retain any individual as an
     employee, to change or not change the status of the Participant's
     employment, or to change the Company's policies or those of its
     subsidiaries regarding termination of employment.

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10.  Amendment/Termination. This Plan can be amended or terminated, in whole or
     in part, by the Company at any time prior to the occurrence of a Change in
     Control. Thereafter, this Plan cannot be terminated or amended in any way
     which adversely affects the rights of any salaried employee.

11.  Validity and Severability. The invalidity or unenforceability of any
     provision of the Plan shall not affect the validity or enforceability of
     any other provision of the Plan, which shall remain in full force and
     effect, and any prohibition or unenforceability in any jurisdiction shall
     not invalidate or render unenforceable such provision in any other
     jurisdiction.


                                       SOUTHDOWN, INC.

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