Exhibit 10.1

TORCHMARK CORPORATION

2008 MANAGEMENT INCENTIVE PLAN

(Effective as of January 1, 2008)

1. PURPOSE. The purpose of the Plan is to enable the Company and its
Subsidiaries to attract, retain, motivate and reward qualified executive
officers and key employees by providing them with the opportunity to earn
competitive compensation directly linked to the Company’s performance. The Plan
is designed to assure that amounts paid pursuant to the Plan to certain
executive officers of the Company will not fail to be deductible by the Company
for Federal income tax purposes because of the limitations imposed by
Section 162(m).

2. DEFINITIONS. Unless the context requires otherwise, the following words as
used in the Plan shall have the meanings ascribed to each below, it being
understood that masculine, feminine and neuter pronouns are used interchangeably
and that each comprehends the others.

(a) “Affiliate” means (i) the Company or any Subsidiary, or (ii) an entity that
directly or through one or more intermediaries controls, is controlled by or is
under common control with, the Company, as determined by the Committee.

(b) “Board” shall mean the Board of Directors of the Company.

(c) “Bonus Pool” shall mean the bonus pool established each year by the
Committee from which Participants in the Plan may be paid bonuses. The total
amount of the Bonus Pool for a given performance period is determined by taking
a percentage of the Company’s pre-tax operating income for the performance
period. Such percentage will be determined each year by the Committee and will
not exceed 1.5%.

(d) “Cause” as a reason for a Participant’s termination of employment shall have
the meaning assigned such term in the employment, severance or similar
agreement, if any, between such Participant and the Company or an Affiliate,
provided, however that if there is no such employment, severance or similar
agreement in which such term is defined, “Cause” shall mean any of the following
acts by the Participant, as determined by the Committee or the Board:

(i) gross neglect of duty;

(ii) prolonged absence from duty without the consent of the Company;

(iii) intentionally engaging in any activity that is in conflict with or adverse
to the business or other interests of the Company; or

(iv) willful misconduct, misfeasance or malfeasance of duty which is reasonably
determined to be detrimental to the Company.

(e) “Change in Control” means and includes the occurrence of any one of the
following events:

(i) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the 1934 Act) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of
25% or more of the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however, that
for purposes of this subsection (i), the following acquisitions shall not
constitute a Change in Control: (A) any acquisition by a Person

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who is on the Effective Date (as defined below) the beneficial owner of 25% or
more of the Outstanding Company Voting Securities, (B) any acquisition directly
from the Company, (C) any acquisition by the Company, (D) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company, or (E) any acquisition by any
corporation pursuant to a transaction which complies with clauses (A), (B) and
(C) of subsection (iii) of this definition;

(ii) Individuals who, as of the date that this Plan is approved by the
stockholders of the Company (the “Effective Date”), constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board;

(iii) Consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (a
“Business Combination”), in each case, unless following such Business
Combination, (A) all or substantially all of the individuals and entities who
were the beneficial owners of the Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors of the
corporation resulting from such Business Combination (including, without
limitation, a corporation which as a result of such transaction owns the Company
or all or substantially all of the Company’s assets either directly or through
one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination of the Outstanding
Company Voting Securities, and (B) no Person (excluding any corporation
resulting from such Business Combination or any employee benefit plan (or
related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 25% or more of the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination, and (C) at least a majority of the members of the board of
directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or

(iv) approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

(f) “Code” shall mean the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder.

(g) “Committee” shall mean the Compensation Committee of the Board (or such
other committee of the Board that the Board shall designate from time to time)
or any subcommittee thereof comprised of two or more directors each of whom is
an “outside director” within the meaning of Section 162(m).

(h) “Company” shall mean Torchmark Corporation, a Delaware corporation.

(i) “Covered Employee” shall have the meaning set forth in Section 162(m).

(j) “Good Reason” (or a similar term denoting constructive termination) has the
meaning, if any, assigned such term in the employment, severance or similar
agreement, if any, between a Participant and the Company or an Affiliate,
provided, however that if there is no such employment, severance or similar
agreement in which such term is defined, “Good Reason” shall mean the occurrence
of any of the following, without the express written consent of the Participant,
after the occurrence of a Change in Control:

 

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(i)(A) the assignment to the Participant of any duties inconsistent in any
material adverse respect with the Participant’s position, authority or
responsibilities immediately prior to the date of the Change in Control, or
(B) any other material adverse change in such position, including authority or
responsibilities;

(ii) any failure by the surviving entity in the Change in Control to comply with
any of the provisions of this Plan, other than an insubstantial or inadvertent
failure remedied by the Company promptly after receipt of notice thereof given
by the Participant;

(iii) the Company’s requiring the Participant to be based, or to perform a
substantial portion of his or her duties with the Company, at any office or
location more than 20 miles from that location at which he performed his or her
services immediately prior to the date of the Change in Control, except for
travel reasonably required in the performance of the Participant’s
responsibilities; or

(iv) any failure by the Company to obtain the assumption and agreement to
perform this Plan by a successor as contemplated by Section 6(a).

(k) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended,
and any rules or regulations promulgated thereunder.

(l) “Participant” shall mean each “executive officer” (as such term is defined
in Rule 3b-7 promulgated by the Securities and Exchange Commission under the
Exchange Act) of the Company whom the Committee designates as a participant
under the Plan.

(m) “Plan” shall mean the Torchmark Corporation 2008 Management Incentive Plan,
as set forth herein and as may be amended from time to time.

(n) “Section 162(m)” shall mean Section 162(m) of the Code.

(o) “Section 409A” shall mean Section 409A of the Code.

(p) “Subsidiary(ies)” shall mean any entity of which the Company possesses
directly or indirectly 50% or more of the total combined voting power of all
classes of stock of such entity.

(q) “2 1/2 Month Period” shall mean as soon as practical after award amounts are
no longer subject to a substantial risk of forfeiture, but in no event later
than the period ending on the later of the 15th day of the third month following
the end of the Participant’s first taxable year in which the amount is no longer
subject to a substantial risk of forfeiture (as defined in Section 409A) or the
15th day of the third month following the end of the Company’s first taxable
year in which the amount is no longer subject to a substantial risk of
forfeiture; unless otherwise required by Section 409A, an amount shall be
considered no longer subject to a substantial risk of forfeiture on the last day
of the applicable calendar year for which a bonus is earned.

3. ADMINISTRATION. The Committee shall administer and interpret the Plan;
provided, however, that in no event shall the Plan be interpreted in a manner
which would cause any amount payable under the Plan to any Covered Employee to
fail to qualify as performance-based compensation under Section 162(m). The
Committee shall establish the performance objectives for any calendar year in
accordance with Section 4 and certify whether and to what extent such
performance objectives have been attained. Any determination made by the
Committee under the Plan shall be final and conclusive. The Committee may employ
such legal counsel, consultants and agents (including counsel or agents who are
employees of the Company or a Subsidiary) as it may deem desirable for the
administration of the Plan and may rely upon any opinion received from any such
counsel, consultant or agent and any computation received from such counsel,
consultant or agent. All expenses incurred in the administration of the Plan,
including, without limitation, for the engagement of any counsel, consultant or
agent, shall be paid by the Company. No member or former member of the Board or
the Committee shall be liable for any act, omission, interpretation,
construction or determination made in connection with the Plan other than as a
result of such individual’s willful misconduct.

 

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4. BONUSES. (a) Establishment of Performance Criteria. No later than 90 days
after the commencement of each calendar year (or such other date as may be
required or permitted under Section 162(m)), the Committee shall establish in
writing the performance objective or objectives that must be satisfied in order
for a Participant to receive a bonus for such year, provided that the outcome is
substantially uncertain at the time the objectives are established and no more
than 25% of the measuring period of service has elapsed. Any such performance
objectives shall be based upon the relative or comparative achievement of one or
more of the following criteria, alone or in combination, which may be expressed
in terms of Company-wide objectives or in terms of objectives that relate to the
performance of a division, business unit, region, department or function within
the Company or a Subsidiary, as determined by the Committee: (i) for officers of
the Company, growth in net operating income per share, pre-tax operating income,
return on equity, cash flow, premium or sales growth, stock performance, total
shareholder return, expense efficiency ratio, revenue, economic value added,
shareholder value added, expense ratio, loss ratio, profit margin, investment
income, return on capital, and/or return on invested capital, or (ii) for
officers of Subsidiaries, growth in insurance operating income, underwriting
income and/or insurance premium.

(b) Establishment of Target Bonus Amounts. At the time the Committee sets the
performance objectives under the Plan for a particular year, it shall also
establish in writing the target bonus amounts for each Participant, which will
be the maximum bonus amount payable to a Participant assuming that all of the
relevant performance objectives are achieved. The Committee also shall describe
in writing the method for computing the amount of the bonus payable to the
Participant to the extent the performance objective or objectives are satisfied.
The target bonus amounts will be communicated to each Participant during the
first quarter of the performance period.

(c) Maximum Bonus Amount Payable. Notwithstanding anything else contained in
Section 4 to the contrary, (i) the Chief Executive Officer of the Company may be
paid a bonus for any calendar year not to exceed 30% of the amount of the Bonus
Pool for that year, (ii) the other Covered Employees, as a group, may be paid
bonuses for any calendar year not to exceed, in the aggregate, 30% of the Bonus
Pool for that year, and (iii) the maximum bonus amount payable to any
Participant hereunder for any single calendar year shall be $4,000,000.

(d) Determination of Bonus Amounts. Following the end of each year, the
Committee will determine the extent to which the performance objective or
objectives for such Participant have been met and certify such determination.
Based on such determination, the Committee shall determine the amount of the
bonus payable to such Participant for such year. Except as otherwise provided in
Section 5(d), no bonus amount will be payable under the Plan to any Covered
Employee relative to a performance objective if thresholds established by the
Committee for such performance objective are not reached.

(e) Termination of Employment. Unless the Committee shall otherwise determine
and except as otherwise set forth in Section 5(d), if a Participant voluntarily
resigns employment or is terminated involuntarily prior to the last day of the
calendar year for which the bonus is payable or prior to the date on which the
bonus amounts are determined by the Committee for such calendar year, any bonus
payable for such calendar year shall be forfeited. Unless the Committee shall
otherwise determine and except as otherwise set forth in Section 5(d), if a
Participant’s employment terminates for any other reason (including, without
limitation, his or her death, disability or retirement under the terms of any
retirement plan maintained by the Company or a Subsidiary) prior to the last day
of the calendar year for which the bonus is payable, such Participant shall
receive an annual bonus equal to the amount the Participant would have received
as an annual bonus award if such Participant had remained an employee through
the end of the year multiplied by a fraction, the numerator of which is the
number of days that elapsed during the calendar year in which the termination
occurs prior to and including the date of the Participant’s termination of
employment and the denominator of which is 365.

(f) Negative Discretion. Notwithstanding anything else contained in Section 4 to
the contrary, the Committee shall have the right, in its absolute discretion,
(i) to reduce or eliminate the amount otherwise payable to any Participant under
Section 4 based on individual performance or any other factors that the
Committee, in its discretion, shall deem appropriate (as long as such reduction
or elimination with respect to a Participant does not

 

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result in an increase in the amount payable to another Participant) and (ii) to
establish rules or procedures that have the effect of limiting the amount
payable to each Participant to an amount that is less than the maximum amount
otherwise authorized under Section 4.

(g) Affirmative Discretion. Notwithstanding any other provision in the Plan to
the contrary, (i) the Committee shall have the right, in its discretion, to pay
to any Participant who is not a Covered Employee an annual bonus for such year
in an amount up to the maximum bonus payable under Section 4, based on
individual performance or any other criteria that the Committee deems
appropriate and (ii) in connection with the hiring of any person who is or
becomes a Covered Employee, the Committee may provide for a minimum bonus amount
in any calendar year, regardless of whether performance objectives are attained.

5. PAYMENT. (a) Payment. Subject to Sections 5(b) and 5(c) below and except as
otherwise provided hereunder, payment of any bonus amount determined under
Section 4 shall be made to each Participant as soon as practicable after the
Committee certifies that one or more of the applicable performance objectives
have been attained (or, in the case of any bonus payable under the provisions of
Section 4(g), after the Committee determines the amount of any such bonus) but
in no event later than the 2 1/2 Month Period. Any such payments shall be made
in cash or, at the election of the Participant and subject to the approval of
the Committee, in stock options, restricted stock and/or restricted stock units
(to the extent such options, restricted stock and/or restricted stock units are
available and permitted to be issued under any properly approved and adopted
plan in conformance with applicable regulations); provided, however, that any
election by a Participant to receive any payments hereunder other than in cash
shall submitted to the Committee in writing no later than June 30 of the
calendar year to which performance period relates and such election shall be
irrevocable. In the event that any bonuses are paid in the form of stock
options, restricted stock and/or restricted stock units, the terms of such stock
options, restricted stock or restricted stock units, as the case may be, shall
be set forth in the applicable plan and/or stock option agreement, restricted
stock award agreement, restricted stock unit award agreement or other grant
document.

(b) Deferral of Bonuses. Each Participant who is a management or highly
compensated employee and who is entitled to participate in the Torchmark
Corporation Restated Deferred Compensation Plan for Directors, Advisory
Directors, Directors Emeritus and Officers, as amended (the “Deferral Plan”),
may elect to defer payment of any amounts payable hereunder in accordance with
the Deferral Plan. To the extent that a Participant entitled to participate in
the Deferral Plan elects to defer the payment of any amounts payable hereunder,
the terms of the Deferral Plan shall apply to the payment of any such deferred
amounts.

(c) Delay of Payment. Notwithstanding anything in the Plan to the contrary, the
Committee may defer all or any portion of any payment of a bonus to be made
hereunder beyond the 2 1/2 Month Period as allowed under Section 409A, including
but not necessarily limited to, if the Committee reasonably anticipates that the
Participant’s deduction with respect to such payment otherwise would not be
permitted by application of Section 162(m), and, as of the date the legally
binding right to the payment arose, a reasonable person would not have
anticipated the application of Section 162(m) at the time of the payment, and
provided further that the payment is made as soon as reasonably practicable
following the first date on which the Committee anticipates or reasonably should
anticipate that, if the payment were made on such date, the Participant’s
deduction with respect to such payment would no longer be restricted due to the
application of Section 162(m).

(d) Acceleration of Payout of Bonus Upon Termination of Employment Following a
Change in Control. If (i) the Company or the surviving entity following the date
of a Change in Control terminates a Participant’s employment other than for
Cause or (ii) the Participant terminates his or her employment for Good Reason
with the Company or the surviving entity following the date of a Change in
Control, then the target payout opportunities attainable under such
Participant’s outstanding bonus awards under this Plan shall be deemed to have
been fully earned as of the date of termination based upon an assumed
achievement of all relevant performance goals at the “target” level, and there
shall be a pro rata payout to the Participant within thirty (30) days following
the date of termination (or, if later, the first date that such payment may be
made without causing a violation of Section 409A of the Code) based upon the
length of time within the performance period that has elapsed prior to the date
of termination.

 

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(e) Clawback. Notwithstanding anything else contained in the Plan to the
contrary, if the Company’s financial results are materially restated, the
Committee may review the circumstances surrounding the restatement and determine
whether and which Participants will be required to forfeit the right to receive
any future payments under the Plan and/or repay to the Company any prior
payments determined by the Committee to have been inappropriately received by
the Participant. If the Company’s financial results are restated due to fraud or
material non-compliance by the Company, as a result of misconduct, with any
financial reporting requirements of the federal securities laws, any Participant
who the Committee determines participated in or is responsible for the fraud or
noncompliance causing the need for the restatement forfeits the right to receive
any future payments under the Plan and must repay any amounts paid in excess of
the amounts that would have been paid based on the restated financial results.
Any repayments required under this Section 5(e) must be made by the Participant
within ten (10) days following written demand from the Company.

6. GENERAL PROVISIONS. (a) Successors. This Agreement shall inure to the benefit
of and be binding upon the Company and its successors. The Company shall require
any successor to all or substantially all of the business and/or assets of the
Company, whether direct or indirect, by purchase, merger, consolidation,
acquisition of stock or otherwise, by an agreement in form and substance
satisfactory to the Participant, expressly to assume the Plan and agree to
perform under the Plan in the same manner and to the same extent as the Company
would be required to perform if no such succession had taken place.

(b) Effectiveness of the Plan. Subject to the approval by the holders of the
common stock of the Company at the 2008 Annual Meeting of Stockholders, the Plan
shall be effective with respect to calendar years beginning on or after
January 1, 2008, and ending on or before December 31, 2012, unless the term
hereof is extended by action of the Board. It is intended that this Plan
supersede the Torchmark Corporation Annual Management Incentive Plan for
calendar years beginning January 1, 2008 and thereafter.

(c) Amendment and Termination. Notwithstanding Section 6(b), the Board or the
Committee may at any time amend, suspend, discontinue or terminate the Plan;
provided, however that, (i) except as set forth in (iii) below, no such
amendment, suspension, discontinuance or termination shall adversely affect the
rights of any Participant in respect of any calendar year that has already
commenced, (ii) no such action shall be effective without approval by the
stockholders of the Company to the extent necessary to continue to qualify the
amounts payable hereunder to Covered Employees as performance-based compensation
under Section 162(m), and (iii) subject to (ii) above, at any time the Committee
determines that the Plan or any award hereunder may be subject to Section 409A,
the Committee shall have the right, in its sole discretion to amend the Plan as
it may determine is necessary or desirable either for the Plan or awards to be
exempt from the application of Section 409A or to satisfy the requirements of
Section 409A, including by adding conditions with respect to the vesting and/or
the payment of the awards.

(d) Designation of Beneficiary. Each Participant may designate a beneficiary or
beneficiaries (which beneficiary may be an entity other than a natural person)
to receive any payments which may be made following the Participant’s death.
Such designation may be changed or canceled at any time without the consent of
any beneficiary. Any such designation, change or cancellation must be made in a
form approved by the Committee and shall not be effective until received by the
Committee. If no beneficiary has been named, or the designated beneficiary or
beneficiaries shall have predeceased the Participant, the beneficiary shall be
the Participant’s spouse or, if no spouse survives the Participant, the
Participant’s estate. If a Participant designates more than one beneficiary, the
rights of such beneficiaries shall be payable in equal shares, unless the
Participant has designated otherwise.

(e) No Right of Continued Employment. Nothing in this Plan shall be construed as
conferring upon any Participant any right to continue in the employment of the
Company or any of its Subsidiaries.

(f) Interpretation. Notwithstanding anything else contained in this Plan to the
contrary, to the extent required to so qualify any award as other performance
based compensation within the meaning of Section 162(m)(4)(C) of the Code, the
Committee shall not be entitled to exercise any discretion otherwise authorized
under this Plan (such as the right to pay a bonus without regard to the
achievement of the relevant performance objectives) with

 

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respect to such award if the ability to exercise such discretion (as opposed to
the exercise of such discretion) would cause such award to fail to qualify as
other performance based compensation under Section 162(m). It is intended that
this Plan, as written and in operation, will be exempt from Section 409A;
however, if payments are otherwise deemed “deferred compensation” under
Section 409A, then payment will be made within the guidelines of Section 409A to
the extent possible, and the specified payment date applicable to an award shall
be within ninety (90) days of the date upon which the award is determined by the
Committee to have been earned; provided however, that if the payments are deemed
“deferred compensation” and a Participant is deemed to be a “specified employee”
(within the meaning of Section 409A), then amounts payable under this Plan shall
not be paid until the date that is six months after the date of the
Participant’s separation from service (within the meaning of Section 409A), or
the date on which such Participant dies, if earlier.

(g) No Limitation to Corporation Action. Nothing in this Plan shall preclude the
Committee or the Board, as each or either shall deem necessary or appropriate,
from authorizing the payment to the eligible employees of compensation outside
the parameters of the Plan, including, without limitation, base salaries, awards
under any other plan of the Company and/or its Subsidiaries (whether or not
approved by stockholders), any other bonuses (whether or not based on the
attainment of performance objectives) and retention or other special payments;
provided, however, that if the stockholders of the Company do not approve the
Plan at the first annual meeting of stockholders following the adoption of the
Plan, the Plan set forth herein shall not be implemented.

(h) Nonalienation of Benefits. Except as expressly provided herein, no
Participant or beneficiary shall have the power or right to transfer,
anticipate, or otherwise encumber the Participant’s interest under the Plan. The
Company’s obligations under this Plan are not assignable or transferable except
to (i) a corporation which acquires all or substantially all of the Company’s
assets, (ii) any corporation into which the Company may be merged or
consolidated, or (iii) the extent required by Section 6(a) hereof. The
provisions of the Plan shall inure to the benefit of each Participant and the
Participant’s beneficiaries, heirs, executors, administrators or successors in
interest.

(i) Withholding. Any amount payable to a Participant or a beneficiary under this
Plan shall be subject to any applicable Federal, state and local income and
employment taxes and any other amounts that the Company or a Subsidiary is
required at law to deduct and withhold from such payment.

(j) Severability. If any provision of this Plan is held unenforceable, the
remainder of the Plan shall continue in full force and effect without regard to
such unenforceable provision and shall be applied as though the unenforceable
provision were not contained in the Plan.

(k) Governing Law. The Plan shall be construed in accordance with and governed
by the laws of the State of Delaware, without reference to the principles of
conflict of laws.

(l) Headings. Headings are inserted in this Plan for convenience of reference
only and are to be ignored in a construction of the provisions of the Plan.

(m) Rule of Construction. Unless the context otherwise requires, any references
to an “Article,” “Section” or “clause” refers to an Article, Section or clause,
as the case may be, of this Plan.

 

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