Exhibit 10.1
LANCE, INC.
2006 Three-Year Incentive Plan for Officers

          Purposes and Introduction   The primary purposes of the 2006 Long-Term
Incentive Plan for Officers are to:
 
       
 
  •   Align executives’ interests with those of stockholders by linking a
substantial portion of compensation to the Company’s average Return on Capital
Employed (ROCE) over three fiscal years based on the Company’s 2006-2008
Operations Plan.
 
       
 
  •   Provide a way to attract and retain key executives and managers who are
critical to Lance’s future success.
 
       
 
  •   Provide competitive total compensation for executives and managers
commensurate with Company performance.
 
            To achieve the maximum motivational impact, performance measures,
Plan goals and the awards that will be received for meeting those goals will be
communicated to participants as soon as practical after the 2006 Plan is
approved by the Compensation Committee of the Board of Directors.
 
            Each participant will be assigned a Target Incentive, stated as a
percent of Base Salary. The Target Incentive Awards, or a greater or lesser
amount, will be granted after the end of the three fiscal years, 2006 through
2008 (the “Performance Period”), based on the attainment of predetermined goals.
 
            For 2006, participants will be eligible to earn incentive awards
based on the Company’s three-year average ROCE against specific goals as
described below.
 
       
 
  •   ROCE is calculated for each fiscal year during the Performance Period as
follows:
 
       
 
      (Net Income + Interest Expense) x (1 — Tax Rate)
 
      Average Equity + Average Net Debt
 
            Tax Rate for ROCE shall be the Company’s actual total effective
income tax rate.

 

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              Average Net Debt shall be the Company’s average debt less average
cash.
 
            Average amounts for ROCE shall be calculated on a 12-month basis.
 
            Base Salary shall be the annual rate of base compensation for the
2006 fiscal year which is set no later than April of such fiscal year.
 
        Performance Period   The period over which performance will be measured
is the Company’s three fiscal years, 2006 through 2008.
 
        Eligibility and Participation   Eligibility in the Plan is limited to
Executive Officers and managers who are key to Lance’s success. The Compensation
Committee will review and approve participants nominated by the President and
Chief Executive Officer. Participation in the 2006 Plan does not guarantee
participation in any subsequent long-term incentive plans, but will be
reevaluated and determined on an annual basis.
 
            Attachment A includes the list of 2006 Plan participants approved by
the Compensation Committee on April 27, 2006.
 
        Target Incentives and Performance Measures   Each participant will be
assigned a Target Incentive expressed as a percentage of his or her Base Salary.
Participants may be assigned to a Performance Tier by position, by salary level
or based on other factors as determined by the President and Chief Executive
Officer. If the duties of a participant change significantly during the
Performance Period, the President and Chief Executive Officer, with the approval
of the Compensation Committee, may change the Target Incentive for such
participant for the remaining portion of the Performance Period on a pro rata
basis.
 
            The 2006 through 2008 financial performance measure for the Company
as a whole is shown below. Specific goals and related payouts are also shown
below.

                  Threshold   Target   Maximum Lance, Inc. average ROCE   *%  
*%   *% Award Level Funded   *%   *%   *%

 

          [*Targets not required to be disclosed.]
 
            Percent of payout will be determined on a straight line basis
between Threshold and Target and between Target and Maximum. There will be no
payouts unless the Threshold performance

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              measure is reached.
 
            The performance measure will be communicated to each participant as
soon as practicable after it has been established. Final Target Incentive Awards
will be calculated after the Compensation Committee has reviewed the Company’s
audited financial statements for 2006 through 2008 and determined the
performance level achieved.
 
            The following definitions for the terms Maximum, Target and
Threshold should help set the goals for the Performance Period, as well as
evaluate the payouts:
 
       
 
  •   Maximum: Excellent; deserves payout above Target
 
       
 
  •   Target: Normal or expected performance; deserves Target payout
 
       
 
  •   Threshold: Lowest level of performance deserving a payout
 
            Attachment A lists the Target Incentives for each participant for
the Plan Years as determined by the Compensation Committee. Target Incentives
will be communicated to each participant as close to the beginning of the year
as practicable, in writing. Target Incentives will be calculated by multiplying
each participant’s Base Salary by the appropriate percentages, as described
below.
 
       
 
  Target Incentives shall be calculated as follows:

                  Percentage of Base Salary Performance Tier   for 2006-2008
Target Incentives   1     *%   2     *%   3     *%

 

          [*Targets not required to be disclosed.]
 
            Final Target Incentive Awards will be calculated and granted after
the Compensation Committee has reviewed the Company’s audited financial
statements for 2006 through 2008 and determined the performance levels achieved.
 
        Awards   Each participant shall receive cash equal to 25% in value of
his or her award, 50% in value will be in restricted stock and 25% in value in
stock options, except that the President and Chief Executive Officer will
receive cash equal to 100% in value of his

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              award and no restricted stock or stock options.
 
            The number of shares of the Company’s Common Stock with respect to
each stock option granted pursuant to the 2006 Plan will equal the applicable
dollar value divided by the value of a stock option calculated using the
Black-Scholes or other option valuation model used by the Company as of the date
of grant for financial accounting purposes. Stock options will (i) be
nonqualified, (ii) vest on the date of grant, (iii) have an exercise price equal
to the average of the high and low for the Company’s Common Stock on the date of
grant and (iv) be exercisable for five years after the date of grant, subject to
the provisions below regarding termination of employment.
 
            The number of shares of the Company’s Common Stock with respect to
each restricted stock grant pursuant to the 2006 Plan will equal the applicable
dollar value divided by the average of the high and low for the Company’s Common
Stock on the date of grant. Restricted stock will vest as to 50% of the shares
on the date of grant and the balance one year after the date of grant, subject
to the provisions below regarding termination of employment.
 
            For purposes of the 2006 Plan, the date of grant of stock options
and restricted stock will be the date established by the Compensation Committee
after the applicable performance level has been determined.
 
        Form and Timing of Awards   Awards will be made as soon as practicable
after performance measures are calculated and approved by the Compensation
Committee. All awards will be rounded to the nearest multiple of $100 or up to
the next whole share, as the case may be.
 
        Change In Status   An employee hired into an eligible position during
the Performance Period may participate in the 2006 Plan for the balance of the
Performance Period on a pro rata basis.
 
        Certain Terminations of Employment   In the event a participant
voluntarily terminates employment (other than retirement) or is terminated
involuntarily before the end of the Performance Period, the participant shall
not receive any award hereunder. In the event of death, permanent disability or
retirement before the end of the Performance Period, any award will be
determined after the end of the Performance Period based on actual performance
and paid out on a pro rata basis all in cash.
 
            In the event a participant terminates employment after receiving

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              stock options or restricted stock pursuant to the 2006 Plan, the
post-termination exercise period for stock options and the vesting of restricted
stock will be as follows:
 
       
 
      Voluntary termination (other than retirement): (i) stock options cease to
be exercisable as of the date of termination; and (ii) unvested restricted stock
is forfeited as of the date of termination.
 
       
 
      Involuntary termination: (i) stock options will remain exercisable for a
period of 30 days following the date of termination (or, if earlier, the
original expiration date of the option); and (ii) unvested restricted stock is
forfeited as of the date of termination.
 
       
 
      Death: (i) stock options will remain exercisable for a period of one year
following the date of death (or, if earlier, the original expiration date of the
option); and (ii) unvested restricted stock becomes vested pro rata based on
number of full months completed since the date of grant.
 
       
 
      Permanent disability: (i) stock options will remain exercisable through
the original expiration date of the option; and (ii) unvested restricted stock
becomes vested pro rata based on number of full months completed since the date
of grant.
 
       
 
      Retirement: (i) stock options will remain exercisable for a period of
three years following retirement (or, if earlier, the original expiration date
of the option); and (ii) unvested restricted stock becomes vested pro rata based
on number of full months completed since the date of grant.
 
            For purposes hereof, “retirement” means the participant’s
termination of employment with the Company either (i) after attainment of age 65
or (ii) after attainment of age 55 with the prior consent of the Compensation
Committee.
 
        Change In Control   In the event of a Change in Control, pro rata
payouts will be made all in cash at the greater of (1) Target Incentive or
(2) actual results for the completed fiscal years preceding the Change in
Control, with such pro ration based on the number of days in the Performance
Period preceding the Change in Control. Payouts will be made within 30 days
after the relevant transaction has been completed.
 
            Also, in the event of a Change in Control, the vesting of restricted

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              stock will be accelerated to fully vest upon the effective date of
a Change in Control.
 
            “Change in Control” means, and shall be deemed to have occurred
upon, the first to occur of any of the following events:
 
            (i) Any Outside Person becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing twenty-five percent (25%)
or more of the combined voting power of the Company’s then outstanding
securities; or
 
            (ii) During any period of two (2) consecutive years (not including
any period prior to the date hereof), individuals who at the beginning of such
period constitute the Board (and any new Director, whose nomination for election
by the Company’s stockholders was approved by a vote of at least two-thirds
(2/3) of the Directors then in office who either were Directors at the beginning
of the period or whose nomination for election was so approved) cease for any
reason to constitute a majority of the members of the Board; or
 
            (iii) The stockholders of the Company approve: (i) a plan of
complete liquidation of the Company; or (ii) an agreement for the sale or
disposition of all or substantially all of the Company’s assets other than a
sale or disposition of all or substantially all of the Company’s assets to an
entity at least sixty percent (60%) of the combined voting power of the voting
securities of which are owned by the stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale or disposition; or
 
            (iv) The stockholders of the Company approve a merger,
consolidation, or reorganization of the Company with or involving any other
corporation, other than a merger, consolidation, or reorganization that would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent thereof)
at least sixty percent (60%) of the combined voting power of the voting
securities of the Company (or such surviving entity) outstanding immediately
after such merger, consolidation, or reorganization.
 
            However, in no event shall a “Change in Control” be deemed to have
occurred with respect to a Participant if that Participant is part of a
purchasing group which consummates the Change in Control

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              transaction. A Participant shall be deemed “part of a purchasing
group” for purposes of the preceding sentence if the Participant is an equity
participant in the acquiring company or group or surviving entity (the
“Purchaser”) except for ownership of less than one percent (1%) of the equity of
the Purchaser.
 
            “Beneficial Owner” has the meaning ascribed to such term in
Section 13(d) of the Exchange Act and Rule 13d-3 of the General Rules and
Regulations under the Exchange Act.
 
            “Board” means the Board of Directors of the Company.
 
            “Director” means a member of the Board.
 
            “Member of the Van Every Family” means (i) a lineal descendant of
Salem A. Van Every, Sr., including adopted persons as well as persons related by
blood, (ii) a spouse of an individual described in clause (i) of this Paragraph
or (iii) a trust, estate, custodian and other fiduciary or similar account for
an individual described in clause (i) or (ii) of this Paragraph.
 
            “Outside Person” means any Person other than (i) a Member of the Van
Every Family, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or (iii) a corporation owned directly or
indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of the Company.
 
            “Participant” means an employee of the Company who is granted an
Award under this Plan.
 
        Withholding   The Company shall withhold from awards any Federal,
foreign, state or local income or other taxes required to be withheld.
 
        Communications   Progress reports should be made to participants
annually, showing performance results.
 
        Executive Officers   Notwithstanding any provisions to the contrary
above, participation, awards and prorations for Executive Officers, including
the President and Chief Executive Officer, shall be approved by the Compensation
Committee.
 
        Governance   The Compensation Committee of the Board of Directors of
Lance, Inc. is ultimately responsible for the administration and governance of
the Plan. Actions requiring Committee approval include final determination of
plan eligibility and participation, identification of

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              performance measures and goals, final award components and
determination and amendments to the Plan. The Committee retains the discretion
to adjust any award due to extraordinary events such as acquisitions,
dispositions, required accounting adjustments or similar events; anomalies
affecting the calculations under a performance measure or where fairness to
participants or the Company require an adjustment. The decisions of the
Committee shall be conclusive and binding on all participants.

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Attachment A

                      Award   Target Name   Title   Percentage   Incentive
David V. Singer
  President and Chief   *%   $*
 
  Executive Officer        
 
           
H. D. Fields
  Vice President and   *%   $*
 
  President, Vista        
 
  Bakery, Inc.        
 
           
R. D. Puckett
  Executive Vice President,   *%   $*
 
  Chief Financial Officer        
 
  and Secretary        
 
           
L. R. Gragnani, Jr.
  Vice President   *%   $*
 
  - Information        
 
  Technology/CIO        
 
           
E. D. Leake
  Vice President   *%   $*
 
  — Human Resources        
 
           
F. I. Lewis
  Vice President — Sales   *%   $*
 
           
B. W. Thompson
  Vice President —   *%   $*
 
  Supply Chain        
 
           
M. E. Wicklund
  Controller and   *%   $*
 
  Assistant Secretary        

 
[*Award targets omitted for participants as targets not required to be
disclosed.]