2014 LONG-TERM INCENTIVE AWARD PROGRAM

2014- 2016 Performance Cycle Agreement

For Senior Management Committee (other than CEO) &

Corporate Leadership Group

 

This award agreement (“Agreement”), by and between Lincoln National Corporation
(“LNC”) and the named Grantee (“Grantee”), evidences the grant by LNC on the
specified Grant Date, of a long-term incentive performance award to Grantee, and
Grantee’s acceptance of the award in accordance with and subject to the
provisions of the Lincoln National Corporation Incentive Compensation 2009
Amended and Restated Plan effective May 14, 2009 (“Plan”) and this
Agreement.  LNC and Grantee agree as follows:

 

1.  Form of Award.    This performance award grant shall vest after
certification by the Compensation Committee of the LNC Board of Directors
(“Committee”) of achievement of the established performance criteria.  Any
vested award shall be paid in shares of LNC common stock.  This award is for the
specified number of shares of LNC common stock. 

 

During the performance cycle, this award shall consist of LNC stock units but
any actual award shall ultimately vest and be paid in shares of LNC common
stock.  Grantee’s actual award, if any, will be determined based on performance
during the performance cycle in accordance with the terms of the Plan and the
2014-2016 Performance Cycle approved by the Committee.  The Committee shall
determine if and when any award shall vest under the Plan and reserves the right
to adjust the target award or payout amount of any award under the Plan at any
time to the extent permissible under section 162(m) of the Internal Revenue Code
of 1986, as amended.  The number of shares that may ultimately vest under this
Agreement, if any, shall be adjusted appropriately in the event of a stock
split, reverse stock split, stock dividend, or other similar event. 

 

2.  Transferability.  This award may not be transferred, sold, pledged, or
otherwise encumbered, except by will or the laws of descent and distribution.

 

3.  Non-Competition, Non-Solicitation, Non-Disparagement and Non-Disclosure
Provisions or Termination for Cause.    

(a) Non-Competition.  Grantee may not become employed by, work on behalf of, or
otherwise render services that are the same or similar to the services rendered
by Grantee to the business unit employing Grantee for any other organization or
business which competes with or provides, or is planning to provide, the same or
similar products and/or services as the business unit in which Grantee was
employed or otherwise had responsibilities for at the time of his/her
termination.  Grantee understands and agrees that this restriction is nationwide
in scope.  If Grantee has terminated employment, Grantee shall be free, however,
to purchase, as an investment or otherwise, stock or other securities of such
organization or business so long as they are listed upon a recognized securities
exchange or traded over-the-counter and such investment does not represent a
greater than five percent (5%) equity interest in the organization or business.

 

(b) Non-Solicitation.  Grantee shall not directly or indirectly hire, manage,
solicit or recruit any employees, agents, financial planners, salespeople,
financial advisors, vendors or service providers of LNC whom Grantee had hired,
managed, supervised, or otherwise became familiar with as a result of his/her
employment with LNC.

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(c) Non-Disparagement.  Grantee shall not (i) make any public statements
regarding his/her employment with LNC (other than factual statements concerning
the dates of employment and positions held) or his/her termination or Retirement
(as defined in Paragraph 6 below) from LNC that are not agreed to by LNC, such
approval not to be unreasonably withheld or delayed; and (ii) Grantee shall not
disparage LNC or any of its subsidiaries or affiliates, its and their respective
employees, executives, officers, or Boards of Directors.

 

(d) Non-Disclosure & Ideas Provision.  Grantee shall not, without prior written
authorization from LNC, disclose to anyone outside LNC, or use in other than
LNC’s business, any information or material relating to the business of LNC that
LNC considers confidential and/or proprietary pursuant to its Code of
Conduct.  Furthermore, Grantee agrees to disclose and assign to LNC all rights
and interest in any invention or idea that Grantee developed or helped develop
for actual or related business, research, or development work during the period
of their Service with LNC.

 

If requested by LNC, Grantee must provide a certification of compliance with the
provisions of this Paragraph 3 prior to the payment of any award.  Failure to
comply with Subparagraphs  3(a) through 3(d) above at any time prior to, or
during the six (6) months after, any such payment shall cause such payment to be
rescinded.  Termination for Cause (as defined in Paragraph 6 below) at any time,
before or after payment of any award, shall result in the cancellation or
rescission of the award.  LNC must notify Grantee in writing of any such
rescission.  LNC, in its discretion, may waive compliance in whole or part in
any individual case.  Within ten (10) days after receiving a rescission notice
from LNC, Grantee must pay the award to LNC.  Such payment by Grantee must be
made in shares of LNC common stock equal to the gross number of shares paid to
the Grantee pursuant to the award subject to the rescission (not net of shares
withheld for taxes).  If Grantee’s employment is terminated by LNC and its
subsidiaries other than for Cause, a failure of Grantee to comply with the
non-competition provisions after such termination shall not in itself cause
rescission if the exercise or payment occurred before the termination.

 

4.  Tax Withholding.  Grantee must remit to LNC an amount equal to the required
tax withholding on the value of the shares payable under this Agreement at such
time as they are taxable to Grantee; and Grantee may elect to surrender shares
of LNC stock (including shares that are a part of this award) to satisfy all or
part of the required tax withholding

 

5.  Change of Control.    Upon a Change of Control, as defined by Section 2(e)
of the Plan pursuant to the definition in effect on the day immediately
preceding such Change of Control, the Committee shall determine what, if any,
award under this Agreement shall be provided to Grantee.  In making such
determination, the Committee shall consider the nature of such Change of
Control, whether continuation of the Plan and the awards for this performance
cycle are feasible, and whether the resulting corporate entity offers or commits
to offer awards of comparable economic value; provided, however, that the
Committee’s determination shall be consistent with existing LNC plans, such as
this Plan and the LNC Executives’ Severance Benefit Plan.

Amounts payable pursuant to this Paragraph 5 shall be paid as of the earlier of
(i) the time long-term incentive awards are normally paid to employees who are
employed at the end of the original performance cycle established by the
Committee for this award, or (ii) the Grantee’s involuntary termination of
employment with LNC and all affiliates without Cause, provided such termination

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occurs within two (2) years after such Change of Control.  A Grantee who
voluntarily terminates employment after a Change of Control but before payment
of the award shall forfeit the award.

 

6.   Definitions.  As used in this Agreement:

 

“Cause” means, a conviction of a felony or any fraudulent or willful misconduct
by Grantee that is materially and demonstrably injurious to the business or
reputation of LNC.   With respect to an SMC member, Cause shall be determined in
the sole discretion of the Compensation Committee of the LNC Board of
Directors.  For any other Grantee, Cause shall be determined in the sole
discretion of LNC’s Chief Human Resources Officer.

 

“Retirement” means, for purposes of this Agreement, Grantee’s retirement from
LNC or a subsidiary at age 55 or older with at least five (5) years of service
with LNC or a subsidiary.

 

“Total Disability” means (as determined by the Committee) a disability that
results in Grantee being unable to engage in any occupation or employment for
wage or profit for which Grantee is, or becomes, reasonably qualified by
training, education or experience.  In addition, the disability must have lasted
six (6) months and be expected to continue for at least six (6) more months or
be expected to continue unto death. 

 

7.  Full or Pro-Rata Awards Upon Certain Events.    Except as provided in this
Paragraph 7 and in Paragraph 5 above, if during the performance cycle Grantee’s
employment (with LNC and all subsidiaries of LNC) terminates for any reason,
Grantee shall not be entitled to any award under this Agreement.  In the case of
Grantee's Retirement, or involuntary termination of employment with LNC and all
affiliates without Cause, Grantee (or Grantee's beneficiary, if applicable)
shall receive a pro-rated award based on the Grantee’s period of service during
the performance cycle.  In the case of death or Total Disability, Grantee shall
receive a non-prorated award as if Grantee had provided service to LNC for the
entire performance cycle.  Any such award shall be paid at the same time
long-term incentive awards are normally paid to employees who are employed at
the end of the performance cycle.  Notwithstanding the foregoing, in the case of
such involuntary termination, any award shall be contingent on Grantee's release
of claims against LNC and its affiliates (in form and substance satisfactory to
LNC) and shall not be paid unless such release shall have become effective;
except that such a release shall not be required when such termination is by
reason of the sale or disposition of the business in which Grantee is employed.

 

8.  Terms Applicable to Stock Units/Shares.  During the performance cycle, the
award shall consist of LNC stock units but any actual award shall be payable in
shares of LNC common stock.  If an award becomes payable in shares of LNC common
stock under this Agreement, Grantee shall also receive an amount equal to the
dividends that would have been paid on such shares of LNC common stock had
Grantee held such shares from the above date of grant through the date the award
becomes payable.  Such dividend equivalent amount shall be paid in shares of LNC
common stock based on the Fair Market Value (as defined in the Plan) of LNC
common stock on the date the award becomes payable (with fractional shares paid
in cash).

 

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IN WITNESS WHEREOF, LNC, by its duly authorized officer has signed this
Agreement as of the first date set forth above.

 

 

 

 

 

 

 

 

 

 

LINCOLN NATIONAL CORPORATION

 

 

 

 

 

 

 

 

 

By:

/s/ Dennis R. Glass

 

 

Dennis R. Glass

 

 

President and Chief Executive Officer

 

 

 

 

 

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