Exhibit 10.5

                              ZIMMER HOLDINGS, INC.
                      EXECUTIVE PERFORMANCE INCENTIVE PLAN

            1. Purpose: The purpose of the Executive Performance Incentive Plan
(the "Plan") is to promote the interests of Zimmer Holdings, Inc. (the
"Company") and its stockholders by providing additional compensation as
incentive to certain key executives of the Company and its Subsidiaries and
Affiliates who contribute materially to the success of the Company and such
Subsidiaries and Affiliates.

            2. Definitions: The following terms when used in the Plan shall, for
the purposes of the Plan, have the following meanings:

                  (a) "Affiliate" shall mean any entity in which the Company has
            an ownership interest of at least 20%.

                  (b) "Code" shall mean the Internal Revenue Code of 1986, as
            amended.

                  (c) "Company" shall mean Zimmer Holdings, Inc., its
            Subsidiaries and Affiliates.

                  (d) "Exchange Act" shall mean the Securities Exchange Act of
            1934, as amended.

                  (e) "Retirement" shall mean termination of the employment of
            an employee with the Company or a Subsidiary or Affiliate on or
            after

                        (i) the employee's 65th birthday or

                        (ii) the employee's 55th birthday having completed 10
                  years of service with the Company.

                  (f) "Subsidiary" shall mean any corporation which at the time
            qualifies as a subsidiary of the Company under the definition of
            "subsidiary corporation" in Section 424 of the Code.

            3. Administration: The Plan shall be administered under the
supervision of the Board of Directors of the Company (the "Board") which may
exercise its powers, to the extent herein provided, through the agency of a
Compensation and Management Development Committee (the "Committee") which shall
be appointed by the Board. The Committee shall consist of not less than two (2)
members of the Board who meet the definition of "outside directors" under the
provisions of Section 162(m) of the Code and the definition of "non-employee
directors" under the provisions of the Exchange Act or the regulations or rules
promulgated thereunder.

            The Committee, from time to time, may adopt rules and regulations
("Regulations") for carrying out the provisions and purposes of the Plan and
make such determinations, not inconsistent with the terms of the Plan, as the
Committee shall deem


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appropriate. The Committee may alter, amend or revoke any Regulation adopted.
The interpretation and construction of any provision of the Plan by the
Committee shall, unless otherwise determined by the Board, be final and
conclusive.

            The Committee may delegate its responsibilities for administering
the Plan to a committee of key executives as the Committee deems necessary. Any
Awards under the Plan to members of this committee and to such other of the
Participants as may be determined from time to time by the Board or the
Committee shall be referred to the Committee or Board for approval. However, the
Committee may not delegate its responsibilities under the Plan relating to any
executive who is subject to the provisions of Section 162(m) of the Code or in
regard to the issuance of any stock under Section 6(c).

            4. Participation: "Participants" in the Plan shall be such key
executives of the Company as may be designated by the Committee to participate
in the Plan with respect to each fiscal year.

            5. Performance Incentive Awards:

                  (a) For each fiscal year of the Company, the Committee shall
            determine:

                        (i) The Company, Subsidiaries and/or Affiliates to
                  participate in the Plan for such fiscal year.

                        (ii) The names of those key executives whom it considers
                  should participate in the Plan for such fiscal year.

                        (iii) The basis(es) for determining the amount of the
                  Awards to such Participants, including the extent, if any, to
                  which payment of all or part of an Award will be dependent
                  upon the attainment by the Company or any Subsidiary or
                  Affiliate or subdivision thereof of any specified performance
                  goal or objective. Performance criteria for Awards under the
                  Plan may include one or more of the following operating
                  performance measures:

                   a. Earnings                      d.  Financial return ratios
                   b. Revenue                       e.  Total Shareholder Return
                   c. Operating or net cash flows   f.  Market share

                  For any Participant not subject to Section 162(m) of the Code,
                  other performance measures or objectives, whether quantitative
                  or qualitative, may be established.

                  The Committee shall establish the specific targets for the
                  selected measures. These targets may be set at a specific
                  level or may be expressed as relative to the comparable
                  measure at comparison companies or a defined index.


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                        (iv) Whether a percentage of an Award shall be deferred
                  or whether a Participant may request the Committee to approve
                  deferred payment of a percentage (not less than 25%) of an
                  Award (the "Deferred Portion"). Any Award or portion of Award
                  of which the Committee does not require deferral or the
                  Participant does not request deferral shall be paid subject to
                  the provisions of Section 6 (the "Current Portion"). Any Award
                  which includes a Deferred Portion shall be subject to the
                  terms and conditions stated in Section 10 and in any
                  Regulations established by the Committee.

                  (b) At any time after the commencement of a fiscal year for
            which Awards have been determined, but prior to the close thereof,
            the Committee may, in its discretion, eliminate or add Participants,
            or increase or decrease the Award of any Participant; but the
            Committee may not alter any election made relative to establishing a
            Deferred Portion of an Award. Any changes or additions with respect
            to Awards of members of any committee established to oversee the
            Plan shall be referred to the Board or Committee, as appropriate,
            for approval.

            6. Payment of Current Portion of Performance Incentive Awards:

                  (a) Subject to such forfeitures of Awards and other conditions
            as are provided in the Plan, the Awards made to Participants shall
            be paid to them or their beneficiaries as follows:

                        (i) As soon as practicable after the end of the fiscal
                  year, the Committee shall determine the extent to which Awards
                  have been earned on the basis of the actual performance in
                  relation to the established performance objectives as
                  established for that fiscal year. Such Awards are only payable
                  to the extent that the Participants have performed their
                  duties to the satisfaction of the Committee.

                        (ii) While no Participant has an enforceable right to
                  receive a Current Portion until the end of the fiscal year as
                  outlined in (i) above, payments on account of the Current
                  Portion may be provisionally made in accordance with the
                  Regulations, based on tentative estimates of the amount of the
                  Award. A Participant shall be required to refund any portion
                  or all of such payments in order that the total payments may
                  not exceed the Current Portion as finally determined, or if
                  the Participant shall forfeit his or her Award for any reason
                  during the fiscal year.

                  (b) There shall be deducted from all payments of Awards any
            taxes required to be withheld by any government entity and paid over
            to any such government in respect of any such payment. Unless
            otherwise elected by the Participant, such deductions shall be at
            the established withholding tax rate. Participants may elect to have
            the deduction of taxes cover the amount of any applicable tax (the
            amount of withholding tax plus the incremental amount


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            determined on the basis of the highest marginal tax rate applicable
            to such Participant).

                  (c) Form of Payment. The Committee shall determine whether
            payment with respect to the Current Portion of an Award, or to the
            payment of a Deferred Portion made under the provisions of Section
            10, shall be made entirely in cash, entirely in Common Stock of the
            Company, or partially in cash and partially in Common Stock.
            Further, if the Committee determines that payment should be made in
            the form of Restricted Shares of Common Stock of the Company, the
            Committee shall designate the restrictions which will be placed upon
            the Common Stock and the duration of those restrictions. For any
            fiscal year, the Committee may not cause Awards to be made under
            this provision which would result in the issuance, either on a
            current or restricted basis, of more than three-tenths of one
            percent of the number of shares of Common Stock of the Company
            issued and outstanding as of January 1 of the fiscal year relating
            to the payment (or as of the effective date of the Plan, in the case
            of the 2001 fiscal year).

            7. Maximum Payments under the Plan: Payments under the Plan shall be
subject to the following maximum levels.

                  (a) Total Payments. The total amount of Awards paid under the
            Plan relating to fiscal year may not exceed two and one-half percent
            of the pretax earnings for the Company in that fiscal year.

                  (b) Maximum Individual Award. The maximum amount which any
            individual Participant may receive relating to any fiscal year may
            not exceed 0.625 percent of the pretax earnings for the Company in
            that fiscal year.

            8. Conditions Imposed on Payment of Awards: Payment of each Award to
a Participant or to the Participant's beneficiary shall be subject to the
following provisions and conditions:

                  (a) Rights to Awards. No Participant or any person claiming
            under or through the Participant shall have any right or interest,
            whether vested or otherwise, in the Plan or in any Award thereunder,
            contingent or otherwise, unless and until all of the terms,
            conditions and provisions of the Plan and the Regulations that
            effect such Participant or such other person shall have been
            complied with. Nothing contained in the Plan or in the Regulations
            shall require the Company to segregate or earmark any cash, shares
            or stock or other property. Neither the adoption of the Plan nor its
            operation shall in any way affect the rights and power of the
            Company or of any Subsidiary or Affiliate to dismiss and/or
            discharge any employee at any time.


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                  (b) Assignment or Pledge of Rights of Participant. No rights
            under the Plan, contingent or otherwise, shall be assignable or
            subject to any encumbrance, pledge or charge of any nature except
            that a Participant may designate a beneficiary pursuant to the
            provisions of Section 9 hereof.

                  (c) Rights to Payments. No absolute right to any Award shall
            be considered as having accrued to any Participant prior to the
            close of the fiscal year with respect to which an Award is made and
            then such right shall be absolute only with respect to any Current
            Portion thereof; the Deferred Portion will continue to be
            forfeitable and subject to all of the conditions of the Plan. No
            Participant shall have any enforceable right to receive any Award
            made with respect to a fiscal year or to retain any payment made
            with respect thereto if for any reason (death included) the
            Participant, during such entire fiscal year, has not performed their
            duties to the satisfaction of the Company.

            9. Designation of Beneficiary: A Participant may name a beneficiary
to receive any payment to which the Participant may be entitled under the Plan
in the event of their death, on a form to be provided by the Committee. A
Participant may change their beneficiary from time to time in the same manner.

            If no designated beneficiary is living on the date on which any
payment becomes payable to a Participant's beneficiary, such payment will be
payable to the person or persons in the first of the following classes of
successive preference:

                  (a) Widow or Widower, if then living
                  (b) Surviving children, equally
                  (c) Surviving parents, equally
                  (d) Surviving brothers and sisters, equally
                  (e) Executors or administrators

and the term "beneficiary" as used in the Plan shall include such person or
persons.

            10. Deferral of Payments: Any portion of an Award deemed the
Deferred Portion under Section 5(a)(iv) shall be subject to the following:

                  (a) The Committee will, in its sole discretion, determine
            whether or not a Deferred Portion may be elected by the Participant
            under an Award or if a Deferred Portion shall be required. If a
            Deferred Portion election is permitted for an Award, the Committee
            will establish guidelines regarding the date by which such deferral
            election by the Participant must be made in order to be effective.

                  (b) Concurrent with the establishment of a Deferred Portion
            for any Award, the Participant shall determine, subject to the
            approval of the Committee, thc portion of any Participant's Deferred
            Portion that is to be valued by reference to the Performance
            Incentive Fixed Income Fund (hereinafter referred to as the "Fixed
            Income Fund"), the portion that is to be valued by reference to the
            Performance Incentive Equity Fund (hereinafter referred to as the
            "Equity Fund"),


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            the portion that is to be valued by reference to the Performance
            Incentive Company Stock Fund (hereinafter referred to as the "Stock
            Fund") and the portion that shall be valued by reference to any
            other fund(s) which may be established by the Committee for this
            purpose.

                  (c) Prior to the beginning of each fiscal year, the Committee
            shall determine if the Fund(s) used to value the account of any
            Participant may be changed from the Fund currently used to any other
            Fund established for use under this Plan. Any such determination
            relating to an individual who is making determinations under this
            subsection (c), shall be referred to the Board (or such Committee of
            the Board as may be designated by the Board) for approval.

                  (d) Payment of the total amount of a Participant's Deferred
            Portions shall be made to the Participant, or, in case of the death
            of the Participant prior to the commencement of payments on account
            of such total amount, to the Participant's beneficiary, in
            installments commencing as soon as practical after the Participant
            shall cease, by reason of death or otherwise, to be an employee of
            the Company, in case of the death of any Participant after the
            commencement payments on account of the total of the Deferred
            Portions, the then remaining unpaid balance thereof shall continue
            to be paid in installments, at such times and in such manner as if
            such Participant were living, to the beneficiary(ies) of the
            Participant. However, the Committee shall possess absolute
            discretion to accelerate the time of payment of any remaining unpaid
            balance of the Deferred Portions to any extent that it shall deem
            equitable and desirable under circumstances where the Participant at
            the time of payment shall no longer be an employee of the Company or
            shall have died.

                  (e) Conduct of Participant Following Termination of
            Employment. If, following date on which a Participant shall cease to
            be an employee of the Company, the Participant shall at any time
            either discloses to unauthorized persons confidential information
            relative to thc business of any of the Company or otherwise act or
            conduct themselves in a manner which the Committee shall determine
            is inimical or contrary to the best interest of the Company, the
            Company's obligation to make any further payment on account of the
            Deferred Portions of such Participant shall forthwith terminate.

                  (f) Assignment of Rights by Participant or Beneficiary. If any
            Participant or beneficiary of a Participant shall attempt to assign
            their rights under the Plan in violation of the provisions thereof,
            the Company's obligation to make any further payments to such
            Participant or beneficiary shall forthwith terminate.

                  (g) Determination of Breach of Conditions. The determination
            of the Committee as to whether an event has occurred resulting in a
            forfeiture or a termination or reduction of the Company's obligation
            in accordance with the foregoing provisions of this paragraph 10
            shall be conclusive.


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                  (h) Fund Composition and Valuation. Deferred Portions of
            Awards under the Plan shall be valued and maintained as follows:

                        (i) In accordance with the provisions, and subject to
                  the conditions, of the Plan and the Regulations, the Deferred
                  Portion as established by the Committee shall be valued in
                  reference to the Participant's account(s) in the Equity Fund,
                  in the Fixed Income Fund, in the Company Stock Fund, and in
                  any other Fund established under this Plan. Account balances
                  shall be maintained as dollar values, units or share
                  equivalents as appropriate based upon the nature of the fund.
                  For unit or share-based funds, the number of units or shares
                  credited shall be based upon the established unit or share
                  value as of the last day of the quarter preceding the
                  crediting of the Deferred Portion.

                        (ii) Investment income credited to Participants'
                  accounts under the Fixed Income Fund shall be determined by
                  the Committee based upon the prevailing rates of return
                  experienced by the Company. The investment income credited to
                  Participants under the Equity Fund shall be established based
                  upon an established market index reflecting the rate of return
                  on equity investments. The Company shall advise Participants
                  of the specific measures used and the current valuations of
                  these Funds as appropriate to facilitate deferral decisions,
                  investment choices and to communicate payout levels. The
                  Company Stock Fund shall consist of units valued as one share
                  of Common Stock of the Company (par value $.01).

                        (iii) Nothing contained in the Fund definitions in
                  subparagraphs 10(h)(i) and 10(h)(ii) above shall require the
                  Company to segregate or earmark any cash, shares, stock or
                  other property to determine Fund values or maintain
                  Participant account levels.

                        (iv) Alternative Funds. The establishment of the "Fixed
                  Income Fund," the "Equity Fund" and the "Stock Fund" as
                  detailed in subparagraphs (i) and (ii) of this paragraph shall
                  not preclude the right of the Committee to direct the
                  establishment of additional investment funds ("Funds").

In establishing such funds, the Committee shall determine the criteria to be
used for determining the value of such Funds.

                  (i) Accelerated Distributions. The Committee may, at its sole
            discretion, allow for the early payment of a Participant's Deferred
            Portion(s) in the event of an "unforeseeable emergency". An
            "unforeseeable emergency" is defined as an unanticipated emergency
            caused by an event beyond the control of the Participant that would
            result in severe financial hardship if the distribution were not
            permitted. Such distributions shall be limited to the amount
            necessary to


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            sufficiently address the financial hardship. Any distributions under
            this provision shall be consistent with all rules and regulations
            established under the Code.

            11. Miscellaneous:

                  (a) By accepting any benefits under the Plan, each Participant
            and each person claiming under or through him shall be conclusively
            deemed to have indicated acceptance and ratification of, and consent
            to, any action taken or made to be taken or made under the Plan by
            the Company, the Board, the Committee or any other committee
            appointed by the Board.

                  (b) Any action taken or decision made by the Company, the
            Board, the Committee, or any other committee appointed by the Board
            arising out of or in connection with the construction,
            administration, interpretation or effect of the Plan or of the
            Regulations shall lie within its absolute discretion, as the case
            may be, and shall be conclusive and binding upon all Participants
            and all persons claiming under or through any Participation.

                  (c) No member of the Board, the Committee, or any other
            committee appointed by the Board shall be liable for any act or
            failure to act of any other member, or of any officer, agent or
            employee of such Board or Committee, as the case may be, or for any
            act or failure to act, except on account of their own acts done in
            bad faith. The fact that a member of the Board shall then be, shall
            theretofore have been or thereafter may be a Participant in the Plan
            shall not disqualify such person from voting at any time as a
            director with regard to any matter concerning the Awards, or in
            favor of or against any amendment or alteration of the Plan,
            provided that such amendment or alteration shall provide no benefit
            for directors as such and provided that such amendment or alteration
            shall be of general application.

                  (d) The Board, the Committee, or any other committee appointed
            by the Board may rely upon any information supplied to them by any
            officer of the Company or any Subsidiary and may rely upon the
            advice of counsel in connection with the administration of the Plan
            and shall be fully protected in relying upon information or advice.

                  (e) Notwithstanding anything to the contrary in the Plan,
            neither the Board nor the Committee shall have any authority to take
            any action under the Plan where such action would affect the
            Company's ability to account for any business combination as a
            "pooling of interests."

            12. Amendment or Discontinuance: The Board may alter, amend, suspend
or discontinue the Plan, but may not, without approval of the holders of a
majority of the Company's Common Stock make any alteration or amendment thereof
which would permit the total payments under the Plan for any year to exceed the
limitations provided in paragraph 7 hereof or to allow for the issuance of
Company Common Stock in excess of the limitation provided in paragraph 6(c).


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            13. Effective Date: The Plan will be effective on August 6, 2001.


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