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                                                                    EXHIBIT 10.1

                          HILLENBRAND INDUSTRIES, INC.

         AMENDED AND RESTATED SHORT-TERM INCENTIVE COMPENSATION PROGRAM
                  (AS PROPOSED TO BE REVISED IN SEPTEMBER 2004)

                                    ARTICLE I
                             PURPOSE AND DEFINITIONS

1.1   PURPOSE. The purpose of this Program is to provide performance-based
      incentive awards, in addition to regular salary, to eligible employees of
      Hillenbrand Industries, Inc. and its Subsidiaries. The Program provides
      the mechanism to pay amounts above the average total cash compensation
      when the Company experiences above average financial success. The Program
      is designed to encourage high individual and group performance and is
      based on the philosophy that employees should share in the success of the
      Company if above average value is created for Company shareholders.

1.2   DEFINITIONS:

      (a)   "ACHIEVEMENT PERCENTAGE" means a percentage determined in writing by
            the Committee.

      (b)   "BASE INCENTIVE COMPENSATION" means the amount determined in
            accordance with Section 4.3.

      (c)   "BASE SALARY" means the annual calendar earnings of a Participant
            including wages and salary as reported for federal income tax
            purposes, but excluding all bonus payments of any kind, commissions,
            incentive compensation, equity based compensation, long term
            performance compensation, perquisites and other forms of additional
            compensation.

      (d)   "BOARD OF DIRECTORS" or "BOARD" means the Board of Directors of
            Hillenbrand Industries, Inc.

      (e)   "BUSINESS CRITERIA" means one or more of the following financial
            indexes of the Company or a Subsidiary for a Plan Year determined in
            accordance with the Company's accounting principles less certain
            non-reoccurring and/or non-expected events happening in any Plan
            Year, as determined by the Committee: revenue, earnings per share,
            net income, shareholder value growth, return on equity, cash flow,
            comparisons against Standard & Poor's indices and/or other indices
            or comparator groups, as approved by the Committee. The Business

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            Criteria may include both financial and non-financial measures and
            may reflect achievement of tactical and strategic plans of a
            Subsidiary.

      (f)   "BUSINESS CRITERIA ACHIEVEMENT" means the actual final result of a
            Business Criteria for a Plan Year.

      (g)   "CAUSE" shall mean the Committee's good faith determination that a
            Participant has:

            (i)   Failed or refused to fully and timely comply with any
                  reasonable instructions or orders issued by the Employer,
                  provided such noncompliance is not based primarily on the
                  Participant's compliance with applicable legal or ethical
                  standards;

            (ii)  Acquiesced or participated in any conduct that is dishonest,
                  fraudulent, illegal (at the felony level), unethical, involves
                  moral turpitude or is otherwise illegal and involves conduct
                  that has the potential, in the Employer's reasonable opinion,
                  to cause the Employer, its related companies or any of their
                  respective officers or its directors embarrassment or
                  ridicule;

            (iii) Violated any Employer policy or procedure, specifically
                  including a violation of Hillenbrand Industries, Inc.'s Code
                  of Ethical Business Conduct; or

            (iv)  Engaged in any act, which is contrary to its best interests or
                  would hold the Employer, its related businesses or any of
                  their respective officers or directors up to probable civil or
                  criminal liability, excluding the Participant's actions in
                  compliance with applicable legal or ethical standards.

      (h)   "CEO" means the Chief Executive Officer of the Company.

      (i)   A "CHANGE IN CONTROL" means:

            (i) the date that both of the following occur:

                  (A)   any person, corporation, partnership, syndicate, trust,
                        estate or other group acting with a view to the
                        acquisition, holding or disposition of securities of the
                        Company, becomes, directly or indirectly, the beneficial
                        owner, as defined in Rule 13d-3 under the Securities
                        Exchange Act of 1934 ("Beneficial Owner"), of securities
                        of the Company representing 35% or more of the voting
                        power of all securities of the Company having the right
                        under ordinary circumstances to vote at an election of
                        the Board ("Voting

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                        Securities"), other than by reason of (x) the
                        acquisition of securities of the Company by the Company
                        or any Subsidiaries or any employee benefit plan of the
                        Company or any Subsidiaries, (y) the acquisition of
                        securities of the Company directly from the Company, or
                        (z) the acquisition of securities of the Company by one
                        or more members of the Hillenbrand Family (which term
                        shall mean descendants of John A. Hillenbrand and their
                        spouses, trusts primarily for their benefit or entities
                        controlled by them), and

                  (B)   members of the Hillenbrand Family cease to be, directly
                        or indirectly, the Beneficial Owners of Voting
                        Securities having a voting power equal to or greater
                        than that of such person, corporation, partnership,
                        syndicate, trust, estate or group;

            (ii)  the consummation of a merger or consolidation of the Company
                  with another corporation unless

                  (A)   the shareholders of the Company, immediately prior to
                        the merger or consolidation, beneficially own,
                        immediately after the merger or consolidation, shares
                        entitling such shareholders to 50% or more of the voting
                        power of all securities of the corporation surviving the
                        merger or consolidation having the right under ordinary
                        circumstances to vote at an election of directors in
                        substantially the same proportions as their ownership,
                        immediately prior to such merger or consolidation, of
                        Voting Securities of the Company;

                  (B)   no person, corporation, partnership, syndicate, trust,
                        estate or other group beneficially owns, directly or
                        indirectly, 35% or more of the voting power of the
                        outstanding voting securities of the corporation
                        resulting from such merger or consolidation except to
                        the extent that such ownership existed prior to such
                        merger or consolidation; and

                  (C)   the members of the Board, immediately prior to the
                        merger or consolidation, constitute, immediately after
                        the merger or consolidation, a majority of the board of
                        directors of the corporation issuing cash or securities
                        in the merger;

            (iii) the date on which a majority of the members of the Board
                  consist of persons other than Current Directors (which term
                  shall mean any member of the Board on the date hereof and any
                  member whose nomination or election has been approved by a
                  majority of Current Directors then on the Board);

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            (iv)  the consummation of a sale or other disposition of all or
                  substantially all of the assets of the Company; or

            (v)   the date of approval by the shareholders of Corporate of a
                  plan of complete liquidation of the Company.

      (j)   "COMMITTEE" means the Compensation and Management Development
            Committee of the Board appointed to administer the Program under
            Article II. Each Committee member shall be an outside director for
            purposes of Section 162(m)(4) of the Internal Revenue Code of 1986,
            as amended.

      (k)   "COMPANY" means Hillenbrand Industries, Inc. as a corporate holding
            company and does not include Subsidiaries.

      (l)   "DISABILITY" means a physical or mental disability by reason of
            which a Participant is determined by the Office of the President or
            its delegate, to be eligible (except for the waiting period) for
            permanent disability benefits under Title II of the Federal Social
            Security Act.

      (m)   "EMPLOYER" means Hillenbrand Industries, Inc., an Indiana
            Corporation, and its Subsidiaries.

      (n)   "EXECUTIVE MANAGEMENT TEAM" means the officers of the Corporation
            who report directly to the CEO.

      (o)   "INCENTIVE COMPENSATION" means the Incentive Compensation as
            provided for in Article IV.

      (p)   "INCENTIVE COMPENSATION POOL" means the aggregate amount of Base
            Incentive Compensation for all Participants for any Plan Year.

      (q)   "INCENTIVE COMPENSATION OPPORTUNITY" means the percentage of Base
            Salary as determined in accordance with Section 4.2.

      (r)   "PARTICIPANT" means any individual who is a non-bargained for,
            full-time or regular part-time employee of the Employer and is
            selected for participation in the Program pursuant to Article III.

      (s)   "PERCENTAGE OF TARGET ONE ACHIEVEMENT" means a percentage determined
            as of the end of each Plan Year as follows:

            (Business Criteria Achievement - Performance Base) / (Target One -
            Performance Base.)

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      (t)   "PERCENTAGE OF TARGET TWO ACHIEVEMENT" means a percentage determined
            as of the end of each Plan Year as follows:

            (Business Criteria Achievement - Target One) / (Target Two - Target
            One)

      (u)   "PERFORMANCE BASE" means the base level of achievement of the
            Company or a Subsidiary with respect to the Business Criteria, as
            determined in accordance with Section 4.1.

      (v)   "PLAN YEAR" means the fiscal year beginning on October 1st and
            ending on September 30th. The first Plan Year shall begin on October
            1, 2003.

      (w)   "PROGRAM" means the Hillenbrand Industries, Inc. Short-Term
            Incentive Compensation Program.

      (x)   "SUBSIDIARY" means an operating company unit of which a majority
            equity interest is owned directly or indirectly by the Company.

      (y)   "TARGET ONE" means a certain level of achievement of the Company or
            a Subsidiary with respect to the Business Criteria, as determined in
            accordance with Section 4.1.

      (z)   "TARGET TWO" means a certain level of achievement of the Company or
            a Subsidiary with respect to the Business Criteria which is greater
            than Target One as determined in accordance with Section 4.1.

                                   ARTICLE II
                                 ADMINISTRATION

      Full power and authority to construe, interpret, and administer the
Program, including power to establish, administer and certify performance goals
related to Incentive Compensation is vested in the Committee. Decisions of the
Committee are final, conclusive and binding upon all parties, including the
Employer, the Company and its shareholders and the Participants. The Committee
may rely upon recommendations of the CEO, the Executive Management Team, or
persons designated by the Committee, in approving financial and non-financial
goals recommended to it.

                                   ARTICLE III
                                  PARTICIPANTS

      Participation in this Program by members of the Executive Management
Team or any Company corporate officer elected to such position by the Board
shall be determined by the

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Committee. Other Participants in this Program shall be determined by the CEO or
if an eligible employee is employed by a Subsidiary, then the Chief Executive
Officer of such Subsidiary.

                                   ARTICLE IV
                             INCENTIVE COMPENSATION

4.1   ESTABLISHMENT OF PERFORMANCE BASE AND TARGET. A Performance Base, Target
      One and Target Two for the Company Vice Presidents as a group shall be
      recommended by the CEO and approved by the Committee. The Performance
      Base, Target One and Target Two of a Participant who is otherwise employed
      by the Company shall be established and approved by the CEO. The
      Performance Base, Target One and Target Two of a Participant who is
      employed by a Subsidiary shall be established and approved by the CEO and
      the Chief Executive Officer of each Subsidiary, respectively. The
      Performance Base, Target One and Target Two shall be established annually
      for the Company and each Subsidiary and will be communicated to each
      Participant.

4.2   BASE SALARY AS A PART INCENTIVE COMPENSATION. Incentive Compensation
      Opportunity is established in writing annually by the Committee (within
      ninety (90) days of the start of each Plan Year) in percentages up to but
      not exceeding the following:

<TABLE>
<CAPTION>
          CLASS OF PARTICIPANT                   INCENTIVE COMPENSATION OPPORTUNITIES
          --------------------                   ------------------------------------
<S>                                              <C>
Chief Executive Officer of the Company                    90% of Base Salary

Chief Executive Officer of a Subsidiary                   75% of Base Salary

Company Chief Financial Officer                           75% of Base Salary

Company or Subsidiary Senior Executives                   50% of Base Salary

Company or Subsidiary Executives                          40% of Base Salary

Other Key Executives                                      30% of Base Salary
</TABLE>

4.3   BASE INCENTIVE COMPENSATION CALCULATION. Attainment of the Performance
      Base or below for a Plan Year shall result in Base Incentive Compensation
      of 0% of the Incentive Compensation Opportunity as set forth in Section
      4.2 above. If Target Two is met or exceeded for a Plan Year, Base
      Incentive Compensation shall be equal to the Achievement Percentage
      multiplied by the amount of a Participant's Incentive Compensation
      Opportunity as set forth in Section 4.2 above. If Business Criteria
      Achievement is between the Performance Base and Target One for a Plan
      Year, the Base Incentive Compensation shall be equal to the Percentage of
      Target One Achievement multiplied by both (i) the amount of a
      Participant's Incentive Compensation Opportunity

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      as set forth in Section 4.2 above and (ii) a percentage equal to one-half
      of the Achievement Percentage. If the Business Criteria Achievement is
      between Target One and Target Two for a Plan Year, the Base Incentive
      Compensation shall be equal to the amount of a Participant's Incentive
      Compensation Opportunities set forth in Section 4.2 above multiplied by a
      percentage as determined under the following formula:

      [1/2 ACHIEVEMENT PERCENTAGE PLUS (PERCENTAGE OF TARGET TWO ACHIEVEMENT
      TIMES 1/2 ACHIEVEMENT PERCENTAGE)]

4.4   INCENTIVE COMPENSATION. After the Business Criteria Achievement and Base
      Incentive Compensation has been determined for each Plan Year, the
      Committee shall evaluate each Participant on his or her individual
      performance goals. The Committee shall determine each Participant's
      Incentive Compensation based on individual financial and non-financial
      goals for each Participant. The aggregate amount of Incentive Compensation
      that can be paid to all Participants for any Plan Year shall not exceed
      the Incentive Compensation Pool for such Plan Year. The Committee may
      create or authorize, with the assistance of the CEO, sub-pools for
      Participants based on which Subsidiary they are employed by or any other
      criteria the Committee deems appropriate, provided that the aggregate
      amount of all sub-pools cannot exceed the Incentive Compensation Pool for
      any Plan Year. The aggregate amount of Incentive Compensation that can be
      paid to all Participants in a sub-pool or combination of sub pools is the
      aggregate amount of Base Incentive Compensation allocated by the Committee
      to such sub-pool or combination of sub-pools.

4.5   PAYMENT OF INCENTIVE COMPENSATION. Incentive Compensation shall be due and
      payable in cash after forty (40) days but not later than seventy-five (75)
      days after the end of the Plan Year.

4.6   ELECTION TO DEFER COMPENSATION - DEFERRAL PERIOD. A Participant may elect
      to defer all or any portion of his or her Incentive Compensation. A
      Participant's written election to defer any compensation must be made in
      the year before the beginning of the period of service, ordinarily a Plan
      Year, during which such compensation would otherwise be paid.

4.7   TERMINATION OF EMPLOYMENT. Subject to Section 4.8 below and the last
      sentence of this section, termination of Participant's employment prior to
      the last day of the Plan Year for any reasons other than death, Disability
      or normal or early retirement (as determined under the Company's Pension
      Plan or Savings Plan) shall terminate a Participant's right to any
      non-deferred Incentive Compensation. Termination of employment because of
      death, Disability or normal or early retirement shall result in a
      pro-ration of Incentive Compensation based on the number of months
      employed during the Plan Year of a Participant's termination of
      employment. Upon a termination of employment for Cause at any time, a
      Participant shall forfeit any and all payments due under this Program.

4.8   CHANGE IN CONTROL. Upon a Change in Control, a Participant's unpaid
      Incentive Compensation for a Plan Year ending prior to the Change in
      Control shall in all events be

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      paid in accordance with Section 4.5. In addition, a Participant's
      Incentive Compensation for the Plan Year during which the Change in
      Control occurred shall in no event be less than the amount calculated
      pursuant to Sections 4.2, 4.3 and 4.4 above as if the Target (at 100%) had
      been achieved. For purposes of such calculation, Base Salary shall mean
      such Participant's annualized Base Salary for the calendar year in which
      the Change in Control occurred times a fraction, the numerator of which is
      the number of months from the start of the Plan Year up to and including
      the month during which the Change in Control occurred and the denominator
      of which is 12. Following a Change in Control, the Incentive Compensation
      under the Program shall be paid out at the time specified in Section 4.5
      above, provided, however, and notwithstanding Section 4.7 above, that in
      the case of a Participant whose employment is terminated prior to payout
      (for any reason other than on account of termination of employment by the
      Company for Cause) the Incentive Compensation shall be paid out within 30
      days of such termination of employment. In the event of termination for
      Cause, the Incentive Compensation shall be forfeited.

                                    ARTICLE V
                            FINALITY OF DETERMINATION

      Each determination made by the Committee and the CEO shall be final,
binding and conclusive for all purposes and upon all persons. The Committee may
rely conclusively on the determinations made by and information received from
the Company's independent public accountants or the Employer employees with
respect to action of the Committee.

                                   ARTICLE VI
                                   LIMITATIONS

      No employee of the Employer or any other persons shall have any claim or
right (legal, equitable or other) to be granted any award under the Program, and
no director, officer or employee of the Employer, or any other person, shall
have the authority to enter into any agreement with any person for the making or
payment of any award under the Program or to make any representation or warranty
with respect thereto.

      Neither the action of the Company in establishing the Program nor any
action taken by the Company, the Committee, the Board of Directors, CEO,
Executive Management Team, or any persons designated by them to administer the
Program, nor any provision of the Program, shall be construed as giving to any
Participant or employee of the Employer the right to be retained in the employ
of the Employer.

                                   ARTICLE VII
                      AMENDMENTS, SUSPENSION OR TERMINATION

      The Board may discontinue the Program in whole or in part at any time and
may from time to time amend or revise the terms as permitted by applicable
statute; provided, however,

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that no such discontinuance, amendment, or revision shall effect adversely any
right or obligation with respect to any award theretofore made. No amendment
shall require shareholder approval unless such approval is otherwise required by
law.

                                  ARTICLE VIII
                                  MISCELLANEOUS

8.1   EFFECTIVE DATE. This Program was approved by the Board of Directors on
      August 18, 2003, and became effective October 1, 2003, subject to the
      approval of the Program by the stockholders of the Company.

8.2   GOVERNING LAW. This Program shall be governed by and construed in
      accordance with the laws of the State of Indiana.

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