Exhibit 10.1


 


Midwest Holding Inc.


Outside Director Compensation Policy


 


Each member of the Board of
Directors (the “Board”) of Midwest Holding Inc. (the “Company”) who is an outside
director of the Company (each such director, an “Outside Director”) will receive the compensation described
in this Outside Director Compensation Policy (the “Director Compensation Policy”) for his
or her Board service.


 


Cash Compensation


 


Commencing with annual periods
beginning on or after December 16, 2020, the date the Securities and Exchange Commission declared the Company’s registration statement
effective in connection with a public offering, each Outside Director will receive the cash compensation set forth below for service on
the Board. The annual cash compensation amounts will be payable in a lump sum in advance no later than the annual board meeting (generally
held in June of each year). All annual cash fees are vested upon payment.


 


	1.	Annual Board Service Retainer:



 


All Outside Directors: $30,000


 


	2.	Annual Service Retainer for Independent Board Chair:
$30,000



 


	3.	Annual Committee Member Service Retainer:



 


a.    Member
of the Audit Committee: $3,000


b.    Member
of the Compensation Committee: $2,000


c.    Member
of the Nominating and Corporate Governance Committee: $2,000


 


	4.	Annual Committee Chair Service Retainer (in lieu of Committee
Member Service Retainer):



 


a.    Chair
of the Audit Committee: $6,000


b.    Chair
of the Compensation Committee: $4,000


c.    Chair
of the Nominating and Corporate Governance Committee: $4,000


 


Equity Compensation


 


Equity awards consisting of
restricted stock units (“RSUs”) will be granted under either the Company’s 2019 or 2020 Long-Term Incentive
Plans (the “Plan”), or any future successor equity incentive plan, as designated by the Compensation Committee.


 


(a)   Automatic Equity
Grants.


 


i.                   
Annual Grant. Without any further action of the Board or Compensation Committee of the Board, at the close of business on
the date of each annual meeting of the Company’s stockholders (the “Annual Meeting Date”), each
person who is then an Outside Director will automatically receive an RSU grant with an aggregate value of $30,000.


 



     


     


    

 


ii.                   
Initial Grant for New Directors. Without any further action of the Board or Compensation Committee of the Board, each person
who is elected or appointed for the first time to be an Outside Director will automatically, upon the date of his or her initial election
or appointment to be an Outside Director (the “Commencement Date”), receive an RSU grant with an aggregate value
of $30,000, each multiplied by a fraction, the numerator of which is the number of days between the Commencement Date and the then-scheduled
next Annual Meeting Date (or, if such Annual Meeting Date has not yet been scheduled, the first anniversary of the immediately preceding
Annual Meeting Date or such other date as is determined by the Board in its sole discretion), and the denominator of which is 365.


 


iii.                 
RSU Value. The number of shares subject to RSUs granted under the Director Compensation Policy shall be equal to the dollar value
set forth above divided by the Fair Market Value (as defined in the Plan) of the Company’s voting common stock, rounded
down to the nearest share.


 


(b) Vesting; Change in
Control.  Each RSU granted pursuant to the Director Compensation Policy will vest on the earlier of the first anniversary of
its date of grant and the next Annual Meeting Date. All vesting is subject to the Outside Director’s continued service (as set forth
in the Plan) through the applicable vesting date. Notwithstanding the foregoing vesting schedule, for each Outside Director who remains
in continuous service with the Company until immediately prior to the closing of a Change in Control (as defined in the Plan), his or
her then-outstanding RSUs will become fully vested immediately prior to the closing of such Change in Control in which their service is
terminated.


 


(c) Remaining Terms. The
remaining terms and conditions of each RSU, including transferability, will be as set forth in the Company’s standard RSU agreement,
respectively, in the applicable form adopted from time to time by the Board or the Compensation Committee of the Board.


 


Expenses


 


The Company will
reimburse each Outside Director for ordinary, necessary and reasonable out-of-pocket travel expenses to cover in-person attendance
at and participation in Board meetings and meetings of any committee of the Board; provided, that the Outside Director
timely submit to the Company appropriate documentation substantiating such expenses in accordance with the Company’s travel
and expense policy, as in effect from time to time. To the extent that any taxable reimbursements are provided to any Outside
Director, they will be provided in accordance with Section 409A of the Internal Revenue Code of 1986, including, but not limited to,
the following provisions: (i) the amount of any such expenses eligible for reimbursement during such individual’s taxable year
may not affect the expenses eligible for reimbursement in any other taxable year; (ii) the reimbursement of an eligible expense must
be made no later than the last day of such individual’s taxable year that immediately follows the taxable year in which
the expense was incurred; and (iii) the right to any reimbursement may not be subject to liquidation or exchange for another
benefit.


 



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Administration


 


The Board, or any committee
to whom the Board delegates the requisite authority, will administer the Policy. The Board (or such committee) will have the sole discretion
and authority to administer, interpret, amend and terminate the Policy, and the decisions of the Board (or such committee) will be final
and binding on all persons having an interest in the Policy.


 



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