Exhibit 10.4

 

 

 

Biomet, Inc. Executive Severance Pay Plan

 

 

 

 

 

 

 

Effective as of September 22, 2006

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BIOMET, INC.  EXECUTIVE SEVERANCE PAY PLAN

The Biomet, Inc. Executive Severance Pay Plan (“Plan”) is hereby adopted by
Biomet, Inc. (“Company”), effective September 22, 2006, for a select group of
key management employees of the Company and its affiliates and/or subsidiaries. 
The Plan is intended to qualify as a welfare plan for certain selected employees
within the meaning 29 C.F.R. §2520.104-24.

ARTICLE 1

GENERAL PROVISIONS

Biomet, Inc. has established the Plan, effective September 22, 2006, to provide
severance pay and benefits for Eligible Employees in the case of certain
involuntary Terminations of Employment, as determined by the Administrator in
its sole discretion.

ARTICLE 2

USE OF DEFINED TERMS

Certain defined terms are used throughout the Plan.  The definitions of these
terms are contained in Appendix A attached hereto.  Whenever a defined term is
used, it begins with a capital letter.  Please refer to Appendix A for the
meaning of capitalized terms as you read the provisions of the Plan.

ARTICLE 3

PARTICIPATION

An employee of the Company will become a Participant immediately upon becoming
an Eligible Employee, and such employee will cease to be a Participant upon the
later of (i) the date on which such employee ceases to be an Eligible Employee
or (ii) the date on which such employee is no longer entitled to future benefits
under the Plan.

ARTICLE 4

FUNDING OF PLAN

All Plan benefits are paid from the Company’s general assets.

ARTICLE 5

SEVERANCE BENEFITS

SECTION 5.01.         PAYMENT OF SEVERANCE BENEFITS.  SUBJECT TO THE TERMS
SPECIFIED HEREIN, IF A PARTICIPANT’S EMPLOYMENT TERMINATES IN A QUALIFYING
TERMINATION, THE EMPLOYER WILL PAY THE FOLLOWING AMOUNTS AND PROVIDE THE
FOLLOWING BENEFITS:

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(A)       SALARY CONTINUATION, IN ACCORDANCE WITH THE EMPLOYER’S STANDARD
PAYROLL PRACTICES, AT THE SALARY CONTINUATION RATE, THROUGHOUT THE CONTINUATION
PERIOD.  SALARY CONTINUATION SHALL NOT BE CONSIDERED COMPENSATION FOR PURPOSES
OF ANY OTHER BENEFIT PLAN OF THE COMPANY, UNLESS EXPRESSLY PROVIDED FOR THEREIN;

(B)      IF THE PARTICIPANT IS ELIGIBLE FOR AND ELECTS CONTINUATION COVERAGE
PURSUANT TO COBRA (WITH RESPECT TO THE PARTICIPANT AND/OR THE PARTICIPANT’S
DEPENDENTS WHO ARE ELIGIBLE TO ELECT COBRA UNDER THE COMPANY’S GROUP HEALTH
PLAN(S) AS A DIRECT RESULT OF THE PARTICIPANT’S TERMINATION OF EMPLOYMENT), THE
COMPANY SHALL PAY (AS OF THE FIRST OF EACH APPLICABLE MONTH) THE PREMIUMS FOR
SUCH COVERAGE (OR REIMBURSE THE PARTICIPANT FOR SUCH PREMIUMS) FOR THE BENEFITS
CONTINUATION PERIOD.  IF THE COMPANY PAYS THE PREMIUMS FOR SUCH COVERAGE, THEY
WILL CONSTITUTE TAXABLE INCOME TO THE PARTICIPANT;

(C)               CONTINUED PAYMENT OF THE PARTICIPANT’S EMPLOYER-PROVIDED CAR
ALLOWANCE, IF ANY, FOR A PERIOD OF TWELVE MONTHS FROM THE TERMINATION DATE;

(D)    PAYMENT OF A PRO-RATED PORTION OF THE PARTICIPANT’S TARGET BONUS
ESTABLISHED FROM TIME TO TIME BY THE EMPLOYER FOR THE FISCAL YEAR IN WHICH THE
TERMINATION DATE OCCURS (PAYABLE WITHIN 75 DAYS AFTER THE END OF THE EMPLOYER’S
FISCAL YEAR).  THE APPLICABLE PRO-RATED PERCENTAGE TO BE APPLIED TO THE
PARTICIPANT’S TARGET BONUS SHALL BE DETERMINED, IN THE SOLE DISCRETION OF THE
EMPLOYER, BASED UPON THE EMPLOYER’S PERFORMANCE AND ANY OTHER PERFORMANCE
CRITERIA RELATED TO THE PARTICIPANT’S TARGET BONUS; AND,

(E)       ALL OUTSTANDING OPTIONS GRANTED TO THE PARTICIPANT BY THE EMPLOYER ON
ANY COMMON SHARES OF STOCK OF BIOMET, INC. WILL BECOME IMMEDIATELY VESTED AND
EXERCISABLE (TO THE EXTENT NOT YET VESTED AND EXERCISABLE) AS OF THE TERMINATION
DATE AND SHALL REMAIN EXERCISABLE UNTIL THE EARLIER OF (I) THE EXPIRATION OF THE
APPLICABLE OPTION TERM (ASSOCIATED WITH EACH SUCH OPTION) OR (II) FIVE (5) YEARS
AFTER THE TERMINATION DATE.  TO THE EXTENT NOT OTHERWISE PROVIDED UNDER THE
WRITTEN AGREEMENT, IF ANY, EVIDENCING THE GRANT OF ANY RESTRICTED COMMON SHARES
OF STOCK OF BIOMET, INC.  TO THE PARTICIPANT BY AN EMPLOYER, ALL SUCH
OUTSTANDING SHARES THAT HAVE BEEN GRANTED TO THE PARTICIPANT SUBJECT TO
RESTRICTIONS THAT, AS OF THE TERMINATION DATE HAVE NOT YET LAPSED, WILL LAPSE
AUTOMATICALLY UPON THE TERMINATION DATE, AND THE PARTICIPANT WILL BECOME THE
OWNER OF SUCH SHARES FREE AND CLEAR OF ALL SUCH RESTRICTIONS.

(F)       NOTWITHSTANDING THE PRECEDING PROVISIONS OR ANY PROVISION IN THIS PLAN
TO THE CONTRARY, THIS PLAN AND ALL PAYMENTS PURSUANT HERETO ARE INTENDED TO
COMPLY WITH CODE SECTION 409A AND THE GUIDANCE THEREUNDER, AND THIS PLAN SHALL
BE CONSTRUED ACCORDINGLY.  TO THE EXTENT THAT COMPLIANCE WITH SECTION
409A(A)(2)(B)(I) WOULD REQUIRE ANY PAYMENT OTHERWISE PROVIDED FOR BY THIS PLAN
TO BE DELAYED, SUCH PAYMENT SHALL BE MADE AS SOON AS ADMINISTRATIVELY FEASIBLE
AFTER THE PERIOD OF DELAY REQUIRED BY CODE SECTION 409A(A)(2)(B)(I).

SECTION 5.02.         QUALIFIED TERMINATIONS.

(A)       SUBJECT TO THE PROVISIONS OF SUBSECTION (B), THE TERMINATION OF A
PARTICIPANT’S EMPLOYMENT WILL BE DEEMED TO BE A QUALIFIED TERMINATION IF THE
TERMINATION IS, AS DETERMINED

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BY THE ADMINISTRATOR, FOR REASONS UNRELATED TO THE PARTICIPANT’S (I) PERFORMANCE
OF HIS EMPLOYMENT DUTIES OR (II) HIS COMMISSION OF AN ACT OR ACTS OUTSIDE OF THE
SCOPE OF HIS EMPLOYMENT DUTIES THAT WOULD CONSTITUTE THE BASIS OF A TERMINATION
FOR CAUSE UNDER HIS CHANGE IN CONTROL AGREEMENT.

(B)      NOTWITHSTANDING SUBSECTION (A), A TERMINATION OF EMPLOYMENT WILL NOT BE
CONSIDERED A QUALIFIED TERMINATION UNDER ANY OF THE FOLLOWING CIRCUMSTANCES, AS
DETERMINED BY THE ADMINISTRATOR:

(1)                                THE PARTICIPANT FAILS TO COMPLY WITH THE
REQUIREMENTS OF SECTION 5.03;

(2)                                THE PARTICIPANT IS OFFERED AND ACCEPTS
EMPLOYMENT WITH (I) THE COMPANY (OR ANY OF ITS RELATED ENTITIES) OR (II) AN
ENTITY (OR ANY OF ITS RELATED ENTITIES) THAT ACQUIRES PART OR ALL OF THE
BUSINESS OPERATIONS OF THE COMPANY;

(3)                                THE PARTICIPANT IS OFFERED AND REJECTS
COMPARABLE EMPLOYMENT WITH (I) THE COMPANY (OR ANY OF ITS RELATED ENTITIES) OR
(II) AN ENTITY (OR ANY OF ITS RELATED ENTITIES) THAT ACQUIRES PART OR ALL OF THE
BUSINESS OPERATIONS OF THE COMPANY;

(4)                                THE PARTICIPANT’S EMPLOYMENT IS TERMINATED
BECAUSE OF THE LIMITATION OR INTERRUPTION OF BUSINESS OPERATIONS BY OCCURRENCES
BEYOND THE COMPANY’S CONTROL, SUCH AS AN ACT OF WAR, CIVIL DISTURBANCE, FIRE,
FLOOD, OR OTHER DISASTER;

(5)                                THE PARTICIPANT IS ENTITLED TO PAYMENTS OR
BENEFITS UNDER PARTICIPANT’S CHANGE IN CONTROL AGREEMENT AS A RESULT OF THE
TERMINATION OF EMPLOYMENT;

(6)                                THE PARTICIPANT VOLUNTARILY RESIGNS, QUITS OR
RETIRES FROM HIS POSITION OF EMPLOYMENT; OR

(7)                                THE PARTICIPANT’S EMPLOYMENT IS TERMINATED
FOR ANY REASON OTHER THAN AS PROVIDED IN SUBSECTION (A).

SECTION 5.03.         PREREQUISITES TO RECEIVING BENEFITS.  AS A PREREQUISITE TO
RECEIVING ANY BENEFIT HEREUNDER, THE PARTICIPANT MUST SUBMIT TO THE
ADMINISTRATOR A SIGNED RELEASE ACCEPTABLE TO THE ADMINISTRATOR, ON A FORM
PROVIDED BY THE ADMINISTRATOR, RELEASING THE COMPANY AND CERTAIN RELATED
ENTITIES FROM ANY LIABILITY WHATSOEVER IN CONNECTION WITH  PARTICIPANT’S
EMPLOYMENT OR THE TERMINATION THEREOF, EXCEPT AS PROVIDED IN SUCH RELEASE. THE
RELEASE MUST HAVE BECOME VALID ACCORDING TO ITS TERMS, AND THE PERIOD FOR
REVOKING THE RELEASE MUST HAVE PASSED.  IN ADDITION, PARTICIPANT MUST SUBMIT TO
THE ADMINISTRATOR A SIGNED CONFIDENTIALITY AND NON-COMPETE AGREEMENT ACCEPTABLE
TO THE ADMINISTRATOR, ON A FORM PROVIDED BY THE ADMINISTRATOR.

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ARTICLE 6

PLAN ADMINISTRATION

The Plan shall be administered by the Company, which shall be a named fiduciary
within the meaning of the ERISA.  In administering the Plan, the Company shall
have the authority to interpret the terms of the Plan, prescribe rules for
administering the Plan, decide disputes regarding the rights of Participants
under the Plan, and perform all other functions necessary or appropriate to the
administration of the Plan.  In performing its duties as Administrator, the
Company shall have the authority to exercise its discretion to the maximum
extent permitted by law.  Benefits shall be paid under this Plan only if the
Administrator, in its sole discretion, determines that the applicant for
benefits hereunder is entitled to such benefits.

ARTICLE 7

CLAIMS AND APPEALS PROCEDURES

SECTION 7.01.         CLAIMS FOR BENEFITS.

(A)       ALL CLAIMS FOR PLAN BENEFITS WILL BE SUBJECT TO THE RULES SET OUT IN
THIS ARTICLE.  IF A PARTICIPANT BELIEVES THAT HE IS ENTITLED TO BENEFITS THAT
HAVE NOT BEEN PROVIDED, HE MAY FILE A CLAIM, EITHER DIRECTLY OR THROUGH AN
AUTHORIZED REPRESENTATIVE, BY MAILING A WRITTEN NOTICE OF THE CLAIM TO THE
COMPANY’S GENERAL COUNSEL.

(B)      THE ADMINISTRATOR WILL PROVIDE THE CLAIMANT WITH WRITTEN OR ELECTRONIC
NOTICE OF ITS APPROVAL OR DENIAL OF A PROPERLY FILED CLAIM WITHIN 90 DAYS AFTER
RECEIVING THE CLAIM, UNLESS SPECIAL CIRCUMSTANCES REQUIRE AN EXTENSION OF THE
DECISION PERIOD.  IF SPECIAL CIRCUMSTANCES REQUIRE AN EXTENSION OF THE PERIOD
FOR PROCESSING THE CLAIM, THE FIRST 90-DAY DECISION PERIOD MAY BE EXTENDED FOR
UP TO AN ADDITIONAL 90 DAYS.  IF AN EXTENSION OF THE FIRST 90-DAY PERIOD IS
NEEDED, THE ADMINISTRATOR WILL PROVIDE WRITTEN NOTICE OF THE REQUIRED EXTENSION
BEFORE THE END OF THE FIRST 90-DAY PERIOD, SPECIFYING (I) THE CIRCUMSTANCES
REQUIRING AN EXTENSION AND (II) THE DATE BY WHICH THE ADMINISTRATOR EXPECTS TO
MAKE A DECISION.

(C)       IF A CLAIM FOR BENEFITS IS DENIED, THE ADMINISTRATOR WILL PROVIDE THE
CLAIMANT WITH WRITTEN OR ELECTRONIC NOTICE CONTAINING (I) THE SPECIFIC REASONS
FOR THE DENIAL, (II) REFERENCES TO THE PLAN PROVISIONS ON WHICH THE DENIAL IS
BASED; (III) A DESCRIPTION OF ANY ADDITIONAL MATERIAL OR INFORMATION NEEDED AND
WHY SUCH MATERIAL OR INFORMATION IS NECESSARY; (IV) A DESCRIPTION OF THE
APPLICABLE REVIEW PROCEDURES AND TIME LIMITS.

(D)      A CLAIMANT MAY APPEAL THE DENIAL OF A CLAIM BY FILING A WRITTEN APPEAL
WITH THE ADMINISTRATOR WITHIN 60 DAYS AFTER RECEIVING NOTICE OF THE DENIAL.  THE
CLAIMANT’S APPEAL WILL BE DEEMED FILED UPON RECEIPT BY THE ADMINISTRATOR.  IF
THE CLAIMANT DOES NOT FILE A TIMELY APPEAL, THE ADMINISTRATOR’S DECISION WILL BE
FINAL.

(E)       THE ADMINISTRATOR WILL PROVIDE THE CLAIMANT WITH WRITTEN OR ELECTRONIC
NOTICE OF ITS DECISION ON APPEAL WITHIN 60 DAYS AFTER RECEIVING THE CLAIM,
UNLESS SPECIAL CIRCUMSTANCES REQUIRE

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AN EXTENSION OF THE DECISION PERIOD.  IF SPECIAL CIRCUMSTANCES REQUIRE AN
EXTENSION OF THE PERIOD FOR PROCESSING THE CLAIM, THE FIRST 60-DAY DECISION
PERIOD MAY BE EXTENDED FOR UP TO AN ADDITIONAL 60 DAYS.  IF AN EXTENSION OF THE
FIRST 60-DAY PERIOD IS NEEDED, THE ADMINISTRATOR WILL PROVIDE WRITTEN NOTICE OF
THE REQUIRED EXTENSION BEFORE THE END OF THE FIRST 60-DAY PERIOD, SPECIFYING (I)
THE CIRCUMSTANCES REQUIRING AN EXTENSION AND (II) THE DATE BY WHICH THE
ADMINISTRATOR EXPECTS TO MAKE A DECISION.

(F)       IF A CLAIM IS DENIED ON APPEAL, THE ADMINISTRATOR WILL PROVIDE THE
CLAIMANT WITH WRITTEN OR ELECTRONIC NOTICE CONTAINING (I) THE SPECIFIC REASONS
FOR THE DENIAL, (II) REFERENCE TO THE PLAN PROVISIONS ON WHICH THE DENIAL IS
BASED, AND (III) A STATEMENT THAT THE ADMINISTRATOR WILL PROVIDE THE CLAIMANT,
UPON REQUEST AND FREE OF CHARGE, REASONABLE ACCESS TO AND COPIES OF ALL
DOCUMENTS RECORDS, AND OTHER INFORMATION RELEVANT TO THE CLAIM. THE
ADMINISTRATOR’S DECISION ON REVIEW WILL BE FINAL.

SECTION 7.02.         AUTHORIZED REPRESENTATIVE.  THE CLAIMANT’S AUTHORIZED
REPRESENTATIVE MAY ACT ON HIS BEHALF IN PURSUING A BENEFIT CLAIM OR APPEAL UNDER
THE PLAN.

SECTION 7.03.         FULL AND FAIR REVIEW.  UPON REQUEST AND FREE OF CHARGE, A
PARTICIPANT’S DULY AUTHORIZED REPRESENTATIVE WILL BE GIVEN REASONABLE ACCESS TO,
AND COPIES OF, ALL DOCUMENTS, RECORDS, AND OTHER INFORMATION RELEVANT TO THE
PARTICIPANT’S CLAIM.  IN ADDITION, THE PARTICIPANT OR HIS AUTHORIZED
REPRESENTATIVE MAY SUBMIT TO THE APPROPRIATE PERSON OR ENTITY WRITTEN COMMENTS,
DOCUMENTS, RECORDS, AND OTHER INFORMATION RELATING TO THE CLAIM.  IF TIMELY
REQUESTED, THE REVIEW OF A DENIED CLAIM WILL TAKE INTO ACCOUNT ALL COMMENTS,
DOCUMENTS, RECORDS, AND OTHER INFORMATION THAT THE PARTICIPANT OR HIS DULY
AUTHORIZED REPRESENTATIVE HAVE SUBMITTED RELATING TO THE CLAIM, WITHOUT REGARD
TO WHETHER SUCH INFORMATION WAS SUBMITTED OR CONSIDERED IN THE INITIAL BENEFIT
DETERMINATION.

SECTION 7.04.         EXHAUSTION OF REMEDIES.  IF A PARTICIPANT FAILS TO FILE A
REQUEST FOR REVIEW OF A CLAIM DENIAL IN ACCORDANCE WITH THE PROCEDURES DESCRIBED
IN THIS ARTICLE, HE WILL NOT HAVE THE RIGHT OF APPEAL OR THE RIGHT TO BRING AN
ACTION IN ANY COURT, AND THE CLAIM DENIAL WILL BE FINAL.

ARTICLE 8

AMENDMENT AND TERMINATION

Biomet, Inc., by action of its Board of Directors or the Board’s duly authorized
delegate, may amend or terminate the Plan at any time.

ARTICLE 9

MISCELLANEOUS PROVISIONS

SECTION 9.01.         NON-ALIENATION OF BENEFITS.   BENEFITS PAYABLE UNDER THE
PLAN ARE NOT SUBJECT IN ANY MANNER TO ALIENATION, SALE, TRANSFER, ASSIGNMENT,
PLEDGE, ENCUMBRANCE, CHARGE,

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GARNISHMENT, EXECUTION, OR LEVY OF ANY KIND, EITHER VOLUNTARY OR INVOLUNTARY,
BEFORE BEING RECEIVED BY THE PARTICIPANT (OR ANY OTHER PERSON ENTITLED TO
RECEIVE BENEFITS UNDER THE PLAN) AND ANY ATTEMPT TO ALIENATE, SELL, TRANSFER,
ASSIGN, PLEDGE, ENCUMBER, CHARGE, OR OTHERWISE DISPOSE OF ANY RIGHT TO BENEFITS
UNDER THE PLAN SHALL BE VOID.

SECTION 9.02.         LIMITATION OF RIGHTS.  NEITHER THE ESTABLISHMENT NOR THE
MAINTENANCE OF THE PLAN NOR ANY AMENDMENT THEREOF NOR ANY ACT OR OMISSION UNDER
THE PLAN OR RESULTING FROM THE OPERATION OF THE PLAN SHALL BE CONSTRUED:

(A)       AS CONFERRING UPON A PARTICIPANT OR ANY OTHER PERSON A RIGHT OR CLAIM
AGAINST THE EMPLOYER, EXCEPT TO THE EXTENT THAT SUCH RIGHT OR CLAIM SHALL BE
SPECIFICALLY EXPRESSED AND PROVIDED IN THE PLAN OR AS PROVIDED UNDER ERISA;

(B)      AS CREATING ANY RESPONSIBILITY OR LIABILITY OF THE EMPLOYER FOR THE
VALIDITY OR EFFECT OF THE PLAN;

(C)       AS A CONTRACT OR AGREEMENT BETWEEN THE PLAN OR THE EMPLOYER AND THE
PARTICIPANT OR ANY OTHER PERSON; OR

(D)      AS GIVING A PARTICIPANT THE RIGHT TO BE RETAINED IN THE SERVICE OF THE
COMPANY OR TO INTERFERE WITH THE RIGHT OF THE EMPLOYER TO DISCHARGE PARTICIPANT
OR ANY OTHER PERSON AT ANY TIME IN ITS DISCRETION.

SECTION 9.03.         RULES OF INTERPRETATION.  THE FOLLOWING RULES OF
CONSTRUCTION WILL GOVERN ANY INTERPRETATION OF THE PLAN:

(A)       THE PLAN SHALL BE CONSTRUED, ENFORCED, AND ADMINISTERED AND THE
VALIDITY THEREOF DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF INDIANA
TO THE EXTENT THAT SUCH LAWS ARE NOT PREEMPTED BY FEDERAL LAW.

(B)      WORDS USED IN THE MASCULINE SHALL BE CONSTRUED TO INCLUDE THE FEMININE,
WHERE APPROPRIATE, AND VICE VERSA.

(C)       WORDS USED IN THE SINGULAR OR PLURAL SHALL BE CONSTRUED AS BEING IN
THE PLURAL OR SINGULAR, WHERE APPROPRIATE.

(D)      THE HEADINGS AND SUBHEADINGS IN THE PLAN ARE INSERTED FOR CONVENIENCE
OF REFERENCE ONLY AND ARE NOT TO BE CONSIDERED IN THE CONSTRUCTION OF ANY
PROVISION OF THE PLAN.

(E)       IF ANY PROVISION OF THE PLAN IS HELD TO BE ILLEGAL OR INVALID FOR ANY
REASON, THAT PROVISION SHALL BE DEEMED TO BE NULL AND VOID, BUT THE INVALIDATION
OF THAT PROVISION WILL NOT OTHERWISE AFFECT THE PLAN.

SECTION 9.04.         TAX WITHHOLDING.  THE COMPANY MAY WITHHOLD FROM ANY
PAYMENT HEREUNDER INCOME OR EMPLOYMENT TAXES AS IT DEEMS NECESSARY TO COMPLY
WITH APPLICABLE TAX LAWS.

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SECTION 9.05.         NOTICES.  ANY NOTICE GIVEN UNDER THE PLAN WILL BE
SUFFICIENT IF GIVEN TO THE COMPANY, WHEN ADDRESSED TO ITS PRINCIPAL BUSINESS
OFFICE, OR IF GIVEN TO THE PARTICIPANT, WHEN ADDRESSED TO THE PARTICIPANT AT HIS
ADDRESS AS IT APPEARS IN THE RECORDS OF THE COMPANY.

SECTION 9.06.         PLAN DOCUMENT GOVERNS.  THIS PLAN DOCUMENT CONSTITUTES THE
ONLY LEGALLY GOVERNING DOCUMENT FOR THE PLAN.  NO STATEMENT OR OTHER
COMMUNICATION WILL AMEND OR MODIFY ANY PROVISION OF THE PLAN.

SECTION 9.07.         ARBITRATION.  ALL DISPUTES, DEMANDS, CLAIMS,
CONTROVERSIES, ACTIONS, AND/OR CAUSES OF ACTION ARISING FROM OR RELATING TO THIS
PLAN SHALL BE RESOLVED BY BINDING ARBITRATION UNDER THE RULES OF THE THEN
CURRENT CPR INSTITUTE FOR DISPUTE RESOLUTION, BY ONE ARBITRATOR.  THE DECISION
OF THE ARBITRATOR WILL BE FINAL.  THE PLACE OF ARBITRATION SHALL BE WARSAW,
INDIANA.  THIS ARBITRATION CONTRACT IS MADE PURSUANT TO A TRANSACTION IN
INTERSTATE COMMERCE, AND SHALL BE GOVERNED BY THE FEDERAL ARBITRATION ACT.  ANY
JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED BY ANY COURT
HAVING JURISDICTION THEREOF.  THE PARTIES VOLUNTARILY AND KNOWINGLY WAIVE ANY
RIGHT THEY HAVE TO A JURY TRIAL.  THE ARBITRATOR IS NOT EMPOWERED TO AWARD
PUNITIVE DAMAGES OR DAMAGES IN EXCESS OF COMPENSATORY DAMAGES AND EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT TO RECOVER ANY DAMAGES OTHER THAN
COMPENSATORY DAMAGES WITH RESPECT TO ANY DISPUTE RESOLVED BY ARBITRATION.  THE
PARTIES ALSO AGREE THAT NEITHER WILL HAVE THE RIGHT TO PARTICIPATE AS A
REPRESENTATIVE OR MEMBER OF ANY CLASS OF CLAIMANTS PERTAINING TO A CLAIM SUBJECT
TO ARBITRATION UNDER THIS PLAN.  THE PARTIES FURTHER AGREE THAT NEITHER WILL
HAVE THE RIGHT TO CONSOLIDATE CLAIMS SUBJECT TO ARBITRATION UNDER THIS PLAN.

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APPENDIX A

Defined Terms

“Administrator” means the Biomet, Inc.

“Benefits Continuation Period” means the shorter of the (i) the Continuation
Period, (ii) the period for which the Participant is eligible for and elects
Continuation Coverage pursuant to COBRA, not to exceed eighteen (18) months

“Change in Control Agreement” means, with respect to an Employee, the Change in
Control Agreement between the Employee and the Company, as in effect from time
to time.

“COBRA” means ERISA Sections 601 through 607 and Code Section 4980B, as amended
from time to time.

“Comparable Employment” means an employment position that would (i) provide the
Participant with a base salary rate and target bonus that is not less than the
Participant’s base salary rate and target bonus rate at the time of the offer of
such employment, (ii) provide other benefits and compensation that are, in the
Administrator’s judgment, in the aggregate, comparable in value to the other
benefits and compensation for which the Participant is eligible at the time of
such offer, and (iii) would not require that the Participant change his
principal work location by more than 50 miles from such location at the time of
the offer of such employment.

“Company” means Biomet, Inc., its wholly-owned subsidiaries, and any joint
venture in which it participates.  For purposes of Articles VI and VII,
“Company” means Biomet, Inc.

“Continuation Coverage” means continuation coverage under the Employer’s medical
and/or dental program pursuant to COBRA.

“Continuation Period” means the period after a Qualified Termination for which
payments are payable and/or benefits to be provided pursuant to the Plan.  In
general, the “Continuation Period” for a Participant will begin on the effective
date of his Qualified Termination and end after a number of weeks equal to the
sum of (i) the Base Continuation Period, plus (ii) one additional week for each
Year of Service (up to a maximum of 26 additional weeks).  For purposes of the
preceding sentence, the Base Continuation Period shall be 52 weeks.

“Covered Dependent” means a Participant’s dependent who is covered by the
Company’s medical benefits plan upon a Qualified Termination.

“Eligible Employee” means an Employee who (i) is a party to a Change in Control
Agreement with the Company, (ii) has not received any payments pursuant to such
Change in Control Agreement, and (iii) has completed at least one (1) Year of
Service.

A-1

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“Employee” means an individual compensated as a common law employee of the
Company or a wholly-owned subsidiary of the Company.

“Employer” means the specific Biomet group company (i.e. wholly-owned subsidiary
of Biomet, Inc., joint venture in which Biomet, Inc. or one of its wholly-owned
subsidiaries participates or Biomet, Inc. itself) for which Employee provides
services and receives compensation as a common law employee.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“Participant” means an Eligible Employee who has become a Participant pursuant
to Article III and who has not ceased to be a Participant as provided in Article
III.

“Plan” means the Biomet, Inc. Executive Severance Pay Plan, as set out in this
document, as amended from time to time.

“Plan Year” means the calendar year.

“Qualified Termination” has the meaning specified in Section 5.02.

“Salary Continuation” means payments of base salary made pursuant to Subsection
5.01(a).

“Salary Continuation Rate” means the rate of the Participant’s base salary
(without respect to bonuses, incentive compensation, or any other type of
special pay) in effect on the date of Participant’s Qualified Termination,
before any reduction on account of salary reduction contributions pursuant to
Code Section 125 or 401(k) or pursuant to a nonqualified deferred compensation
plan of the Company.

“Termination of Employment,” “Terminates Employment,” or “Terminates his/her
Employment” means, with respect to a Participant, complete termination of the
employment relationship between the Participant and the Company and all related
entities.

“Termination Date” means the date as of which an Employee Terminates Employment.

“Year of Service” means a measuring period of 12 consecutive months throughout
which an Employee is continuously employed as a full-time Employee.  For
purposes of the preceding sentence, an Employee will be considered to be
continuously employed as a full-time Employee during any Employer-approved
leave, provided that he is a full-time Employee immediately before the leave and
returns to work as a full-time Employee immediately after the leave.  For
purposes of this definition, an Employee’s first measuring period will begin on
the date on which he first provides services to the Employer as a full-time
Employee, and his later measuring periods will begin on the anniversaries of
that date; provided, however, if the Employee Terminates Employment and later
provides services as a full-time Employee, his later measuring periods will
begin with the date on which he first provides services as a full-time Employee
after

A-2

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his Termination of Employment and the anniversaries of that date.  If the
Employer acquires another employer or significant business operations of another
employer, in the case of an Employee hired by the Employer as part of the
acquisition, service with the predecessor employer will be treated as service
with the Employer to the extent provided in the agreement of acquisition.

A-3

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