LINCOLN NATIONAL CORP (Form: DEF 14A, Received: 04/04/2007 16:05:57)

Ex hibit 1

Section 10. Notice of Shareholder Business. At any meeting of the shareholders, only such business may be conducted as shall have been properly brought before the meeting, and as shall have been determined to be lawful and appropriate for consideration by shareholders at the meeting. To be properly brought before an annual meeting, business must be (a) specified in the notice of meeting given in accordance with Section 4 of this Article I, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors or the chief executive officer, or (c) otherwise properly brought before the meeting by a shareholder. For business to be properly brought before an annual meeting by a shareholder pursuant to clause (c) above, the shareholder must have given timely notice thereof in writing to the secretary of the corporation. To be timely, a shareholder’s notice must be delivered to or mailed and received at the principal office of the corporation, not less than ninety days nor more than one hundred twenty days prior to the first anniversary date of the annual meeting for the preceding year; provided, however, if and only if the annual meeting is not scheduled to be held within a period that commences thirty days before such anniversary date and ends thirty days after such anniversary date (an annual meeting date outside such period being referred to herein as an “Other Annual Meeting Date”), such shareholder notice shall be given in the manner provided herein by the close of business on the later of (i) the date ninety days prior to such Other Annual Meeting Date or (ii) the tenth day following the date such Other Annual Meeting Date is first publicly announced or disclosed. A shareholder’s notice to the secretary shall set forth as to each matter the shareholder proposes to bring before the meeting (a) a brief description of the business desired to be brought before the meeting, including the text of any proposal to be presented, (b) the name and address, as they appear on the corporation’s stock records, of the shareholder proposing such business, (c) the class and number of shares of the corporation which are beneficially owned by the shareholder, and (d) any interest of the shareholder in such business. Only such business shall be brought before a special meeting of shareholders as shall have been specified in the notice of meeting given in accordance with Section 4 of this Article I. In no event shall the adjournment of an annual meeting or special meeting, or any announcement thereof, commence a new period for the giving of a shareholder’s notice as provided in this Section 10. Notwithstanding anything in these bylaws to the contrary, no business shall be conducted at a meeting except in accordance with the procedures set forth in this Section 10. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the bylaws, or that business was not lawful or appropriate for consideration by shareholders at the meeting, and if he should so determine, he shall so declare to the meeting and any such business shall not be transacted.

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E xh ibit 2

Section 11. Notice of Shareholder Nominees . Nominations of persons for election to the Board of Directors of the corporation may be made at any annual meeting of shareholders by or at the direction of the Board of Directors or by any shareholder of the corporation entitled to vote for the election of directors at the meeting. Such shareholder nominations shall be made pursuant to timely notice given in writing to the secretary of the corporation in accordance with Section 10 of this Article I. [Note: Section 10 is attached to this Proxy Statement as Exhibit 1.] Such shareholder’s notice shall set forth, in addition to the information required by Section 10, as to each person whom the shareholder proposes to nominate for election or re-election as a director, (i) the name, age, business address and residence address of such person, (ii) the principal occupation or employment of such person, (iii) the class and number of shares of the corporation which are beneficially owned by such person, (iv) any other information relating to such person that is required to be disclosed in solicitation of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including without limitation such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected), and (v) the qualifications of the nominee to serve as a director of the corporation. In the event the Board of Directors calls a special meeting of shareholders for the purpose of electing one or more directors to the Board of Directors, any shareholder may nominate a person or persons (as the case may be) for election to such position(s) as specified in the notice of meeting, if the shareholder’s notice of such nomination contains the information specified in this Section 11 and shall be delivered to the secretary of the corporation not later than the close of business on the tenth day following the day on which the date of the special meeting and either the names of the nominees proposed by the Board of Directors to be elected at such meeting or the number of directors to be elected are publicly announced or disclosed. In no event shall the adjournment of an annual meeting or special meeting, or any announcement thereof, commence a new period for the giving of a shareholder’s notice as provided in this Section 11. No shareholder nomination shall be effective unless made in accordance with the procedures set forth in this Section 11. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that a shareholder nomination was not made in accordance with the bylaws, and if he should so determine, he shall so declare to the meeting and the defective nomination shall be disregarded.

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Exh ibit 3

Policy Regarding Approval of Services of Independent Auditor

I. Statement of Principles

Under the Sarbanes-Oxley Act of 2002 (the “Act”), the Audit Committee of the Board of Directors is responsible for the appointment, compensation and oversight of the work of the independent auditor. As part of this responsibility, the Audit Committee is required to approve in advance all services performed by the independent auditor in order to assure that they do not impair the auditor’s independence from the Corporation. To implement these provisions of the Act, the Securities and Exchange Commission (the “SEC”) has issued rules governing the audit committee’s engagement of the independent auditor, as well as rules setting forth the types of services that an independent auditor may not provide to its audit client.

The SEC’s rules provide two methods for approving in advance (referred to as “pre-approving”) the proposed services of the independent auditor. Services may be pre-approved as part of a specific engagement approved by the Audit Committee, or may be pre-approved if they have been generally authorized by the Audit Committee pursuant to a policy complying with SEC rules. Accordingly, and intending to comply with SEC rules, the Audit Committee has adopted this policy regarding the pre-approval of services of the independent auditor.

In pre-approving services, the Audit Committee will consider whether the provision of any service might impair the independence of the independent auditor. As part of that analysis, the Audit Committee shall consider whether the provision of the service, alone or in combination with other such services, would violate any of three basic principles recognized by the SEC: (i) the auditor cannot audit his or her own work, (ii) the auditor cannot function as a part of management, and (iii) the auditor cannot serve in an advocacy role for the client.

II. Specific Pre-approval

The annual audit services engagement terms and fees and any amendments thereto will be subject to the specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit (including required quarterly reviews), subsidiary audits, equity investment audits and other procedures required to be performed by the independent auditor to be able to form an opinion on the Company’s consolidated financial statements. ¹ These other procedures include information systems and procedural reviews and testing performed in order to understand and place reliance on the systems of internal control. Audit services also include the attestation engagement for the independent auditor’s report on management’s report on internal controls for financial reporting.

In addition, any services that are not the subject of a general pre-approval under this policy shall require the Audit Committee’s specific pre-approval.

III. General Pre-approval

The Audit Committee shall periodically and not less than annually pre-approve the performance by the independent auditor of such audit, audit-related, tax and other services as it deems appropriate from time to time. Such pre-approval will require that the Audit Committee first receive and evaluate detailed back-up documentation regarding each service being pre-approved. Also, the Audit Committee will specify a maximum fee for each service being pre-approved, beyond which further approval of the Audit Committee will be required.

In between meetings of the Audit Committee, the Chair of the Audit Committee may pre-approve the performance by the independent auditor of such audit, audit-related, tax and other services as the Chair deems appropriate from time to time. During the period between meetings (“interim period”), the pre-approval authority of the Chair shall be limited to pre-approving fees for such services not to exceed (i) $25,000 per interim period with no right to carryover any pre-approval authority remaining in an interim period to a subsequent interim period, and (ii) $100,000 for any calendar year. Also, the Chair will specify a maximum fee for each service being pre-approved, beyond which further approval of the Chair (subject to the pre-approval fee limit) or the Audit Committee will be required. The Chair must disclose to the Audit Committee any pre-approvals made pursuant to this delegation of authority at the meeting of the Audit Committee next following such pre-approval.

¹ The use of the term “audit services” herein is not intended to correspond to the grouping of services associated with the disclosure of “audit fees” in the proxy statement.

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The period of time covered by any pre-approval shall be as specified in the terms of the pre-approval. However, it is anticipated that the Audit Committee will consider pre-approvals concurrently with its consideration of the annual audit services engagement, and that the term of each pre-approval will be twelve months.

IV. Excluded Services

The Audit Committee will not approve the provision of any non-audit services by the independent auditor which are prohibited by the SEC. A list of the SEC’s prohibited non-audit services is included at Appendix A . The SEC’s rules and relevant guidance should be consulted to determine the precise definitions of these services and the applicability of exceptions to certain of the prohibitions.

The Audit Committee will not permit the retention of the independent auditor in connection with a transaction initially recommended by the independent auditor the primary business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations.

V. Procedures

Proposed services of the independent auditor that are not the subject of a specific pre-approval pursuant to Section II above will be evaluated by the General Auditor. The General Auditor will determine whether such services are included within the list of services that have received the general pre-approval of the Audit Committee and whether the fees for such services are within approved fee levels. If these conditions are satisfied, then the provision of services can commence and the General Auditor shall inform the Audit Committee at its next meeting of the services provided. Proposed services that do not satisfy these conditions require specific pre-approval by the Audit Committee and may be submitted to the Audit Committee by either the independent auditor or the General Auditor. The General Auditor will immediately report to the Audit Committee any breach of this policy that comes to his attention.

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Appendix A

SEC PROHIBITED SERVICES

·	Bookkeeping or other services related to the accounting records or financial statements of the audit client ²

·	Financial information systems design and implementation ¹

·	Appraisal or valuation services, fairness opinions, or contribution-in-kind reports ¹

·	Actuarial services ¹

·	Internal audit outsourcing services ¹

·	Management Functions

·	Human Resources

·	Broker-dealer, investment adviser, or investment banking services

·	Legal services

·	Expert services unrelated to the audit

_______________________

¹ Unless it is reasonable to conclude that the results of these services will not be subject to audit procedures during an audit of the audit client’s financial statements.

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Ex hibit 4

LINCOLN NATIONAL CORPORATION

AMENDED AND RESTATED

INCENTIVE COMPENSATION PLAN

1. Purpose . The purpose of this Amended and Restated Incentive Compensation Plan (the “Plan”) is to assist Lincoln National Corporation, an Indiana corporation (the “Corporation”), and its subsidiaries in attracting, retaining, and rewarding high-quality executives, employees, and other persons who provide services to the Corporation and/or its subsidiaries, enabling such persons to acquire or increase a proprietary interest in the Corporation in order to strengthen the mutuality of interests between such persons and the Corporation’s shareholders, and providing such persons with annual and long-term performance incentives to expend their maximum efforts in the creation of shareholder value. The Plan is also intended to qualify certain compensation awarded under the Plan for tax deductibility under Code Section 162(m) (as hereafter defined) to the extent deemed appropriate by the Committee (or any successor committee) of the Board of Directors of the Corporation.

2. Definitions . For purposes of the Plan, the following terms shall be defined as set forth below, in addition to such terms defined in Section 1 hereof:

(a) “Annual Incentive Award” means a conditional right granted to a Participant under Section 8(c) hereof to receive a cash payment, Stock or other Award, unless otherwise determined by the Committee, after the end of a specified fiscal year.

(b) “Award” means any Option, SAR (including Limited SAR), Restricted Stock, Deferred Stock Units, Stock granted as a bonus or in lieu of another award, Other Stock-Based Award, Performance Award or Annual Incentive Award, together with any other right or interest granted to a Participant under the Plan.

(c) “Beneficiary” means the person, persons, trust or trusts which have been designated by a Participant in his or her most recent written beneficiary designation filed with the Committee to receive the benefits specified under the Plan upon such Participant’s death or to which Awards or other rights are transferred if and to the extent permitted under Section 10(b) hereof. If, upon a Participant’s death, there is no designated Beneficiary or surviving designated Beneficiary, then the term Beneficiary means the person, persons, trust or trusts entitled by will or the laws of descent and distribution to receive such benefits.

(d) “Board” means the Corporation’s Board of Directors.

(e) “Change of Control” shall have the same meaning ascribed to such term in the Lincoln National Corporation Executives’ Severance Benefit Plan (the “Severance Benefit Plan”) on the date immediately preceding the Change of Control.

(f) “Change of Control Price” means an amount in cash equal to the higher of (i) the amount of cash and Fair Market Value of property that is the highest price per share paid (including extraordinary dividends) in any transaction triggering the Change of Control or any liquidation of shares following a sale of substantially all assets of the Corporation, or (ii) the highest Fair Market Value per share at any time during the 60-day period preceding and 60-day period following the Change of Control.

(g) “Code” means the Internal Revenue Code of 1986, as amended from time to time, including regulations thereunder and successor provisions and regulations thereto.

(h) “Committee” means at any date each of those members of the Compensation Committee of the Board who shall be (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, unless administration of the Plan by “non-employee directors” is not then required in order for exemptions under Rule 16b-3 to apply to transactions under the Plan, and (ii) an “outside director” as defined under Code Section 162(m), unless the action taken pursuant to the Plan is not required to be taken by “outside directors” in order to qualify for tax deductibility under Code Section 162(m). Unless otherwise designated by the Board, the Committee shall include not fewer than three members. In the event that fewer than three members of the Compensation Committee are eligible to serve on the Committee, the Board may appoint one or more of its other members who is otherwise eligible to serve on the Committee until such time as three members of the Compensation Committee are eligible to serve.

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(i) “Covered Employee” means an Eligible Person who is a Covered Employee as specified in Section 8(e) of the Plan.

(j) “Deferred Stock Unit” means a right, granted to a Participant under Section 6(e) hereof, to receive Stock, cash or a combination thereof at the end of a specified deferral period.

(k) “Effective Date” of the Plan means January 1, 1997.

(l) “Eligible Person” means each Executive Officer and other officers and employees of the Corporation or of any subsidiary, including employees, agents and brokers who may also be directors of the Corporation. An employee on leave of absence may be considered as still in the employ of the Corporation or a subsidiary for purposes of eligibility for participation in the Plan.

(m) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

(n) “Executive Officer” means an executive officer of the Corporation as defined under the Exchange Act.

(o) “Fair Market Value” means the Fair Market Value of Stock, Awards or other property as determined by the Committee or under procedures established by the Committee. Unless otherwise determined by the Committee the Fair Market Value of Stock shall be the average of the highest and lowest prices of a share of Stock, as quoted on the composite transactions table on the New York Stock Exchange, on the last trading day prior to the date on which the determination of Fair Market Value is being made.

(p) “Incentive Stock Option” or “ISO” means any Option intended to be and designated as an incentive stock option within the meaning of Code Section 422 or any successor provision thereto.

(q) “Limited SAR” means a right granted to a Participant under Section 6(c) hereof.

(r) “Option” means a right, granted to a Participant under Section 6(b) hereof, to purchase Stock or other Awards at a specified price during specified time periods.

(s) “Other Stock-Based Awards” means Awards granted to a Participant under Section 6(g) hereof.

(t) “Participant” means a person who has been granted an Award under the Plan which remains outstanding, including a person who is no longer an Eligible Person.

(u) “Performance Award” means a right, granted to a Participant under Section 8 hereof, to receive Awards based upon performance criteria specified by the Committee.

(v) “Preexisting Plans” mean the Lincoln National Corporation 1986 Stock Option Incentive Plan (the “Stock Option Plan”) and the 1994 Amended and Restated Lincoln National Corporation Executive Value Sharing Plan (the “EVSP”).

(w) “Restricted Stock” means Stock granted to a Participant under Section 6(d) hereof, that is subject to certain restrictions and to a risk of forfeiture.

(x) “Rule 16b-3” means Rule 16b-3, as from time to time in effect and applicable to the Plan and Participants, promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act or any similar law or regulation that may be a successor thereto.

(y) “Stock” means the Corporation’s Common Stock, and such other securities as may be substituted (or resubstituted) for Stock pursuant to Section 10(c) hereof.

(z) “Stock Appreciation Right” or “SAR” means a right granted to a Participant under Section 6(c) hereof.

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3. Administration.

(a) Authority of the Committee. The Plan shall be administered by the Committee . The Committee shall have full and final authority, in each case subject to and consistent with the provisions of the Plan, to interpret the provisions of the Plan, select Eligible Persons to become Participants, grant Awards, determine the type, number and other terms and conditions of, and all other matters relating to, Awards, prescribe Award agreements (which need not be identical for each Participant), adopt, amend and rescind rules and regulations for the administration of the Plan, construe and interpret the Plan and Award agreements and correct defects, supply omissions or reconcile inconsistencies therein, ensure that awards continue to qualify under Rule 16b-3, and make all other decisions and determinations as the Committee may deem necessary or advisable for the administration of the Plan.

(b) Manner of Exercise of Committee. Any action of the Committee shall be final, conclusive and binding on all persons, including the Corporation, its subsidiaries, Participants, Beneficiaries, transferees under Section 10(b) hereof or other persons claiming rights from or through a Participant, and shareholders. The Committee shall exercise its authority only by a majority vote of its members at a meeting or without a meeting by a writing signed by a majority of its members. The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of the Committee. The Committee may delegate to officers or managers of the Corporation or any subsidiary, or committees thereof, the authority, subject to such terms as the Committee shall determine, (i) to perform administrative functions, (ii) with respect to Participants not subject to Section 16 of the Exchange Act, to perform such other functions as the Committee may determine, and (iii) with respect to Participants subject to Section 16, to perform such other functions of the Committee as the Committee may determine to the extent performance of such functions will not result in the loss of an exemption under Rule 16b-3 otherwise available for transactions by such persons, in each case to the extent permitted under applicable law and subject to the requirements and restrictions set forth in Section 8(e). The Committee may appoint agents to assist it in administering the Plan.

(c) Limitation of Liability . The Committee and each member thereof shall be entitled, in good faith, to rely or act upon any report or other information furnished to it, him or her by any executive officer, other officer or employee of the Corporation or a subsidiary, the Corporation’s independent auditors, consultants or any other agents assisting in the administration of the Plan. Members of the Committee and any officer or employee of the Corporation or a subsidiary acting at the direction or on behalf of the Committee shall not be personally liable for any action or determination taken or made in good faith with respect to the Plan, and shall, to the extent permitted by law, be fully indemnified and protected by the Corporation with respect to any such action or determination.

4. Stock Subject to Plan.

(a) Overall Number of Shares Available for Delivery. Subject to adjustment as provided in Section 10(c) hereof, the total number of shares of Stock reserved and available for delivery in connection with Awards under the Plan shall be 37,726,512 of which 28,736,362 shares were either issued or reserved for issuance under outstanding Awards at March 5, 2007; provided, however, that the total number of shares of Stock with respect to which ISOs may be granted shall not exceed 2,000,000. Any shares of Stock that may be issued in payment of Awards, other than Options and SARs, granted on or after May 12, 2005 shall be counted against the limit described above as 3.25 shares for every share of Stock issued in connection with such Award. Shares of Stock issued in connection with Awards granted prior to the amendment and restatement of the Plan approved by shareholders of the Corporation on May 12, 2005 shall be counted against the limit on a share-per-share basis.

(b) Application of Limitation to Grants of Awards. No Award may be granted if the number of shares of Stock to be delivered in connection with such Award or, in the case of an Award measured solely by the increase in value of shares of Stock but settleable only in cash (such as cash-only SARs), the number of shares to which such Award relates, exceeds the number of shares of Stock remaining available under the Plan minus the number of shares of Stock issuable in settlement of or relating to then-outstanding Awards. The Committee may adopt reasonable counting procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or substitute awards) and make adjustments if the number of shares of Stock actually delivered differs from the number of shares previously counted in connection with an Award.

(c) Availability of Shares Not Delivered Under Awards. Shares of Stock subject to an Award under the Plan, or an award under a Preexisting Plan, that is canceled, expired, forfeited, settled in cash or otherwise terminated without a delivery of shares to the Participant will again be available for Awards under the Plan; except that if any such shares could not again be available for Awards to a particular Participant under any applicable law or regulation, such shares shall be available exclusively for Awards to Participants who are not subject to such limitation. With respect to stock settled SARS, the full issuance of shares to settle such Awards will count against shares available under the Plan.

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5. Eligibility; Per-Person Award Limitations . Awards may be granted under the Plan only to Eligible Persons. In each fiscal year during any part of which the Plan is in effect, an Eligible Person may not be granted Awards relating to more than 2,000,000 shares of Stock, subject to adjustment as provided in Section 10(c), under each of the following separate provisions: Sections 6(b), 6(c), 6(d), 6(e), 6(f), 6(g), 8(b) and 8(c). In addition, the maximum cash amount that may be earned under Section 8(c) of the Plan as an Annual Incentive Award or other cash annual Award payable in cash (currently or on a deferred basis) in respect of any fiscal year by any one Participant shall be $8,000,000, and the maximum cash amount that may be earned under Section 8(b) of the Plan as a Performance Award or other cash Award payable in cash (currently or on a deferred basis) in respect of any individual performance period by any one Participant shall be $8,000,000.

6. Specific Terms of Awards.

(a) General. Awards may be granted on the terms and conditions set forth in this Section 6 , provided, however, that no Award shall be made under this Section 6 prior to the date on which shareholders of the Corporation approve the adoption of the Plan. In addition, the Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter (subject to Section 10(e)), such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including terms requiring forfeiture of Awards in the event of termination of employment by the Participant and terms permitting a Participant to make elections relating to his or her Award. The Committee shall retain full power and discretion to accelerate, waive or modify, at any time, any term or condition of an Award that is not mandatory under the Plan. Except in cases in which the Committee is authorized to require other forms of consideration under the Plan, or to the extent other forms of consideration must be paid to satisfy the requirements of Indiana law, no consideration other than services may be required for the grant (but not the exercise) of any Award. Any Award or the value of any Award that is made under this Plan may, subject to any requirements of applicable law or regulation, in the Committee or its designee’s sole discretion, be converted into Deferred Stock Units and treated as provided in Section 6(e) below.

(b) Options. The Committee is authorized to grant Options to Participants on the following terms and conditions:

(i) Exercise Price. The exercise price per share of Stock purchasable under an Option shall be determined by the Committee, provided that such exercise price shall be not less than the Fair Market Value of a share of Stock on the date of grant of such Option.

(ii) Time and Method of Exercise. The Committee shall determine, at the date of grant or thereafter, the time or times at which or the circumstances under which an Option may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the methods by which such exercise price may be paid or deemed to be paid, the form of such payment, including, without limitation, cash, Stock, other Awards or awards granted under other plans of the Corporation or any subsidiary, and the methods by or forms in which Stock will be delivered or deemed to be delivered to Participants.

(iii) ISOs. The terms of any ISO granted under the Plan shall comply in all respects with the provisions of Code Section 422. Anything in the Plan to the contrary notwithstanding, no term of the Plan relating to ISOs (including any SAR in tandem therewith) shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be exercised, so as to disqualify either the Plan or any ISO under Code Section 422, unless the Participant has first requested the change that will result in such disqualification.

(c) Stock Appreciation Rights. The Committee is authorized to grant SARs to Participants on the following terms and conditions:

(i) Right to Payment. A SAR shall confer on the Participant to whom it is granted a right to receive, upon exercise thereof, the excess of (A) the Fair Market Value of one share of Stock on the date of exercise (or, in the case of a “Limited SAR,” the Fair Market Value determined by reference to the Change of Control Price) over (B) the grant price of the SAR as determined by the Committee .

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(ii) Other Terms. The Committee shall determine, at the date of grant or thereafter, the time or times at which and the circumstances under which a SAR may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the method of exercise, method of settlement, form of consideration payable in settlement, method by or forms in which any Stock payable will be delivered or deemed to be delivered to Participants, whether or not a SAR shall be in tandem or in combination with any other Award, and any other terms and conditions of any SAR. Limited SARs that may only be exercised in connection with a Change of Control or other events as specified by the Committee may be granted on such terms, not inconsistent with this Section 6(c), as the Committee may determine. SARs and Limited SARs may be either freestanding or in tandem with other Awards.

(d) Restricted Stock. The Committee is authorized to grant Restricted Stock to Participants on the following terms and conditions:

(i) Grant and Restrictions. Restricted Stock shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose, which restrictions may lapse separately or in combination at such times, under such circumstances (including based on achievement of performance goals and/or future service requirements), in such installments or otherwise, as the Committee may determine at the date of grant or thereafter. Except to the extent restricted under any Award agreement relating to the Restricted Stock, a Participant granted Restricted Stock shall have all of the rights of a shareholder, including the right to vote the Restricted Stock and the right to receive dividends thereon (subject to any mandatory reinvestment or other requirement imposed by the Committee). During the restricted period applicable to the Restricted Stock, subject to Section 10(b) below, the Restricted Stock may not be sold, transferred, pledged, hypothecated, margined or otherwise encumbered by the Participant.

(ii) Forfeiture. Except as otherwise determined by the Committee, upon termination of employment during the applicable restriction period, Restricted Stock that is at that time subject to restrictions shall be forfeited and reacquired by the Corporation; provided that the Committee may, in its discretion, in any individual case provide for waiver in whole or in part of restrictions or forfeiture conditions relating to Restricted Stock .

(iii) Certificates for Stock. Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing Restricted Stock are registered in the name of the Participant, the Committee may require that such certificates bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock, that the Corporation retain physical possession of the certificates, and that the Participant deliver a stock power to the Corporation, endorsed in blank, relating to the Restricted Stock.

(iv) Dividends and Splits. As a condition to the grant of an Award of Restricted Stock, the Committee may require that any cash dividends paid on a share of Restricted Stock be automatically reinvested in additional shares of Restricted Stock or applied to the purchase of additional Awards under the Plan. Unless otherwise determined by the Committee, Stock distributed in connection with a Stock split or Stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such Stock or other property has been distributed.

(e) Deferred Stock Units. The Committee is authorized to grant to Participants Deferred Stock Units, which are rights to receive Stock, cash, or a combination thereof at the end of a specified deferral period . Unless otherwise specified by the Committee, Deferred Stock Units shall be credited as of the date of award to a bookkeeping reserve account maintained by the Employer under the Lincoln National Corporation Executive Deferred Compensation Plan for Employees or its successor (the “Deferred Compensation Plan”) in units which are equivalent in value to shares of Common Stock (“Deferred Stock Units”). Once credited to such account, Deferred Stock Units shall be governed by the terms of the Deferred Compensation Plan.

(f) Bonus Stock and Awards in Lieu of Obligations. The Committee is authorized to grant Stock as a bonus, or to grant Stock or other Awards in lieu of obligations to pay cash or deliver other property under the Plan or under other plans or compensatory arrangements, provided that, in the case of Participants subject to Section 16 of the Exchange Act, the amount of such grants remains within the discretion of the Committee to the extent necessary to ensure that acquisitions of Stock or other Awards do not impair a participant’s exemption from liability under Section 16(b) of the Exchange Act. Stock or Awards granted hereunder shall be subject to such other terms as shall be determined by the Committee.

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(g) Other Stock-Based Awards. The Committee is authorized, subject to limitations under applicable law, to grant to Participants such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Stock, as deemed by the Committee to be consistent with the purposes of the Plan, including, without limitation, convertible or exchangeable debt securities, other rights convertible or exchangeable into Stock, purchase rights for Stock, Awards with value and payment contingent upon performance of the Corporation or any other factors designated by the Committee, and Awards valued by reference to the book value of Stock or the value of securities of or the performance of specified subsidiaries. The Committee shall determine the terms and conditions of such Awards. Stock delivered pursuant to an Award in the nature of a purchase right granted under this Section 6(g) shall be purchased for such consideration, paid for at such times, by such methods, and in such forms, including, without limitation, cash, Stock, other Awards, or other property, as the Committee shall determine. Cash awards, as an element of or supplement to any other Award under the Plan, may also be granted pursuant to this Section 6(g).

7. Certain Provisions Applicable to Awards.

(a) Stand-Alone, Additional, Tandem, and Substitute Awards; No Repricing. Awards granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution or exchange for, any other Award or any award granted under another plan of the Corporation, any subsidiary, or any business entity to be acquired by the Corporation or a subsidiary, or any other right of a Participant to receive payment from the Corporation or any subsidiary. Such additional, tandem, and substitute or exchange Awards may be granted at any time. If an Award is granted in substitution or exchange for another Award or award, the Committee shall require the surrender of such other Award or award in consideration for the grant of the new Award. Notwithstanding any other provision of this Plan, no Option that has been granted by the Corporation or a subsidiary thereof shall be thereafter repriced, replaced or regranted through cancellation, or otherwise modified without shareholder approval (except in connection with a change in the Corporation’s capitalization), if the effect would be to reduce the exercise price for the shares underlying such Option.

(b) Term of Awards. The term of each Award shall be for such period as may be determined by the Committee; provided that in no event shall the term of any Option or SAR exceed a period of ten years (or such shorter term as may be required in respect of an ISO under Code Section 422).

(c) Form and Timing of Payment Under Awards; Deferrals. Subject to the terms of the Plan and any applicable Award agreement, payments to be made by the Corporation or a subsidiary upon the exercise of an Option or other Award or settlement of an Award may be made in such forms as the Committee shall determine, including, without limitation, cash, Stock, other Awards or other property, and may be made in a single payment or transfer, in installments, or on a deferred basis. The settlement of any Award may be accelerated, and cash paid in lieu of Stock in connection with such settlement, in the discretion of the Committee or upon occurrence of one or more specified events (in addition to a Change of Control). Installment or deferred payments may be required by the Committee (subject to Section 10(e) of the Plan, including the consent provisions thereof) in the case of any deferral of an outstanding Award not provided for in the original Award agreement, except that this provision shall not prevent the Committee or its designee from converting an Award to Deferred Stock Units as provided under Section 6(a) above or permitted at the election of the Participant on terms and conditions established by the Committee. Payments may include, without limitation, provisions for the payment or crediting of reasonable interest on installment or deferred payments or the grant or crediting of dividend equivalents or other amounts in respect of installment or deferred payments denominated in Stock.

(d) Exemptions from Section 16(b) Liability. It is the intent of the Corporation that the grant of any Awards to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt under Rule 16b-3 (except for transactions acknowledged in writing to be non-exempt by such Participant). Accordingly, if any provision of this Plan or any Award agreement does not comply with the requirements of Rule 16b-3 as then applicable to any such transaction, unless the Participant shall have acknowledged in writing that a transaction pursuant to such provision is to be non-exempt, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Participant shall avoid liability under Section 16(b) of the Exchange Act.

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(e) Cancellation and Rescission of Awards . Unless the Award agreement specifies otherwise, the Committee may cancel any unexpired, unpaid, or deferred Awards at any time, and the Corporation shall have the additional rights set forth in Section 7(e)(iv) below, if the Participant is not in compliance with all applicable provisions of the Award agreement and the Plan including the following conditions:

(i) A Participant shall not render services for any organization or engage directly or indirectly in any business which, in the judgment of the Chief Executive Officer of the Corporation or other senior officer designated by the Committee, is or becomes competitive with the Corporation. For Participants whose employment has terminated, the judgment of the Chief Executive Officer or other senior officer designated by the Committee shall be based on the Participant’s position and responsibilities while employed by the Corporation, the Participant’s post-employment responsibilities and position with the other organization or business, the extent of past, current and potential competition or conflict between the Corporation and the other organization or business, the effect on the Corporation’s shareholders, customers, suppliers and competitors of the Participant assuming the post-employment position and such other considerations as are deemed relevant given the applicable facts and circumstances. A Participant who has terminated employment 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 equity interest in the organization or business.

(ii) A Participant shall not, without prior written authorization from the Corporation, disclose to anyone outside the Corporation, or use in other than the Corporation’s business, any confidential information or material relating to the business of the Corporation that is acquired by the Participant either during or after employment with the Corporation.

(iii) A Participant shall disclose promptly and assign to the Corporation all right, title, and interest in any invention or idea, patentable or not, made or conceived by the Participant during employment by the Corporation, relating in any manner to the actual or anticipated business, research or development work of the Corporation and shall do anything reasonably necessary to enable the Corporation to secure a patent where appropriate in the United States and in foreign countries.

(iv) Upon exercise, settlement, payment or delivery pursuant to an Award, the Participant shall certify on a form acceptable to the Committee that he or she is in compliance with the terms and conditions of the Plan. Failure to comply with the provisions of this Section 7(e) prior to, or during the six months after, any exercise, payment or delivery pursuant to an Award shall cause such exercise, payment or delivery to be rescinded. The Corporation shall notify the Participant in writing of any such rescission within two years after such exercise, payment or delivery; provided, however, that the Corporation may, in its discretion, in any individual case provide for waiver in whole or in part of compliance with the provisions of this Section 7(e). Within ten days after receiving such a notice from the Corporation, the Participant shall pay to the Corporation the amount of any gain realized or payment received as a result of the rescinded exercise, payment or delivery pursuant to an Award. Such payment shall be made either in cash or by returning to the Corporation the number of shares of Stock that the Participant received in connection with the rescinded exercise, payment or delivery. In the case of any Participant whose employment is terminated by the Corporation and its subsidiaries without “cause” (as defined in the Award agreement), however, a failure of the Participant to comply with the provisions of Section 7(e)(i) after such termination of employment shall not in itself cause rescission or require repayment with respect to any Award exercised, paid or delivered before such termination.

8. Performance and Annual Incentive Awards.

(a) Performance Conditions. The right of a Participant to exercise or receive a grant or settlement of any Award, and the timing thereof, may be subject to such performance conditions as may be specified by the Committee. The Committee may use such business criteria and other measures of performance as it may deem appropriate in establishing any performance conditions, and may exercise its discretion to reduce or increase the amounts payable under any Award subject to performance conditions, except as limited under Sections 8(b) and 8(c) hereof in the case of a Performance Award or Annual Incentive Award intended to qualify under Code Section 162(m).

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(b) Performance Awards Granted to Designated Covered Employees. If the Committee determines that a Performance Award to be granted to an Eligible Person who is or may become a Covered Employee should qualify as “performance-based compensation” for purposes of Code Section 162(m), the grant, exercise and/or settlement of such Performance Award shall be contingent upon achievement of preestablished performance goals and other terms set forth in this Section 8(b).

(i) Performance Goals Generally. The performance goals for such Performance Awards shall consist of one or more business criteria and a targeted level or levels of performance and associated maximum Award payments with respect to each of such criteria, as specified by the Committee consistent with this Section 8(b). Performance goals shall be objective and shall otherwise meet the requirements of Code Section 162(m) and regulations thereunder (including Regulation 1.162-27 and successor regulations thereto), including the requirement that the level or levels of performance targeted by the Committee result in the achievement of performance goals being “substantially uncertain.” The Committee may determine that such Performance Awards shall be granted, exercised and/or settled upon achievement of any performance goal or that more than one performance goal must be achieved as a condition to grant, exercise and/or settlement of such Performance Awards. Performance goals may differ for Performance Awards granted to any one Participant or to different Participants.

(ii) Business Criteria. One or more of the following business criteria for the Corporation, as defined by the Committee, on a consolidated basis, and/or for specified subsidiaries or business units of the Corporation (except with respect to the total shareholder return and earnings per share criteria), shall be used by the Committee in establishing performance goals for such Performance Awards: (1) earnings (total or per share); (2) revenues or growth in revenues; (3) cash flow or cash flow return on investment; (4) assets, return on assets, growth in assets, return on investment, capital or return on capital, return on equity, or shareholder equity (total or per share); (5) economic value added or insurance-imbedded value added; (6) operating margin; (7) net income or growth in net income (total or per share), pretax earnings or growth in pretax earnings (total or per share), pretax earnings before interest, depreciation and amortization, pretax operating earnings after interest expense and before incentives, and extraordinary or special items; (8) operating earnings or income from operations; (9) total shareholder return; (10) profit margins; (11) sales, deposits, net flows, premiums and fees, or growth in premiums and fees, including service fees; (12) book value; (13) customer and producer growth or retention; (14) market share or change in market share; (15) stock price or change in stock price; (16) market capitalization, change in market capitalization, or return on market value; (17) fund, account or investment performance; (18) cash flow or change in cash flow; (19) expense ratios, product cost reduction through advanced technology, or other expense management measures; (20) productivity ratios or other measures of operating efficiency or effectiveness; (21) ratio of claims or loss costs to revenues; (22) satisfaction measures: customer, provider, or employee; (23 ) implementation or completion of critical projects or processes; (24) product development, product release schedules, new product innovation, brand recognition/acceptance ; (25) any of the above goals as compared to the performance of a published or special index deemed applicable by the Committee including, but not limited to, the Standard & Poor’s 500 Stock Index or a group of comparator companies; and (26) any criteria comparable to those listed above, including metrics designed to measure progress toward achieving the company’s strategic intent of becoming the retirement income security company of choice for its clients, that shall be approved by the Committee. One or more of the foregoing business criteria shall be exclusively used in establishing performance goals for Annual Incentive Awards granted to a Covered Employee under Section 8(c) hereof.

(iii) Performance Period; Timing for Establishing Performance Goals. Achievement of performance goals in respect of such Performance Awards shall be measured over a performance period, which may overlap with another performance period or periods, of up to ten years, as specified by the Committee. Performance goals shall be established not later than 90 days after the beginning of any performance period applicable to such Performance Awards, or at such other date as may be required or permitted for “performance-based compensation” under Code Section 162(m).

(iv) Performance Award Pool. The Committee may establish a Performance Award pool, which shall be an unfunded pool, for purposes of measuring performance of the Corporation in connection with Performance Awards. The amount of such Performance Award pool shall be based upon the achievement of a performance goal or goals based on one or more of the business criteria set forth in Section 8(b)(ii) hereof during the given performance period, as specified by the Committee in accordance with Section 8(b)(iii) hereof. The Committee may specify the amount of the Performance Award pool as a percentage of any of such business criteria, a percentage thereof in excess of a threshold amount, or as another amount which need not bear a strictly mathematical relationship to such business criteria.

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(v) Settlement of Performance Awards; Other Terms. Settlement of such Performance Awards shall be in cash, Stock, other Awards or other property, including deferred payments in any such forms, in the discretion of the Committee. The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with such Performance Awards, but may not exercise discretion to increase any such amount payable to a Covered Employee in respect of a Performance Award subject to this Section 8(b). The Committee shall specify the circumstances in which such Performance Awards shall be paid or forfeited in the event of termination of employment by the Participant prior to the end of a performance period or settlement of Performance Awards.

(c) Annual Incentive Awards Granted to Designated Covered Employees. If the Committee determines that an Annual Incentive Award to be granted to an Eligible Person who is or may become a Covered Employee should qualify as “performance-based compensation” for purposes of Code Section 162(m), the grant, exercise and/or settlement of such Annual Incentive Award shall be contingent upon achievement of preestablished performance goals and other terms set forth in this Section 8(c).

(i) Annual Incentive Award Pool. The Committee may establish an Annual Incentive Award pool, which shall be an unfunded pool, for purposes of measuring performance of the Corporation in connection with Annual Incentive Awards. The amount of such Annual Incentive Award pool shall be based upon the achievement of a performance goal or goals based on one or more of the business criteria set forth in Section 8(b)(ii) hereof during the given performance period, as specified by the Committee in accordance with Section 8(b)(iii) hereof. The Committee may specify the amount of the Annual Incentive Award pool as a percentage of any of such business criteria, a percentage thereof in excess of a threshold amount, or as another amount which need not bear a strictly mathematical relationship to such business criteria.

(ii) Potential Annual Incentive Awards. Not later than the end of the 90th day after the beginning of each fiscal year, or at such other date as may be required or permitted in the case of Awards intended to be “performance-based compensation” under Code Section 162(m), the Committee shall determine the Eligible Persons who will potentially receive Annual Incentive Awards, and the amounts potentially payable thereunder, for that fiscal year, either out of an Annual Incentive Award pool established by such date under Section 8(c)(i) hereof or as individual Annual Incentive Awards. In the case of individual Annual Incentive Awards intended to qualify under Code Section 162(m), the amount potentially payable shall be based upon the achievement of a performance goal or goals based on one or more of the business criteria set forth in Section 8(b)(ii) hereof in the given performance year, as specified by the Committee; in other cases, such amount shall be based on such criteria as shall be established by the Committee. In all cases, the maximum Annual Incentive Award of any Participant shall be subject to the limitation set forth in Section 5 hereof.

(iii) Payout of Annual Incentive Awards. After the end of each fiscal year, the Committee shall determine the amount, if any, of (A) the Annual Incentive Award pool, and the maximum amount of potential Annual Incentive Award payable to each Participant in the Annual Incentive Award pool, or (B) the amount of potential Annual Incentive Award otherwise payable to each Participant. The Committee may, in its discretion, determine that the amount payable to any Participant as a final Annual Incentive Award shall be increased or reduced from the amount of his or her potential Annual Incentive Award, including a determination to make no final Award whatsoever, but may not exercise discretion to increase any such amount in the case of an Annual Incentive Award intended to qualify under Code Section 162(m). The Committee shall specify the circumstances in which an Annual Incentive Award shall be paid or forfeited in the event of termination of employment by the Participant prior to the end of a fiscal year or settlement of such Annual Incentive Award.

(d) Written Determinations. All determinations by the Committee as to the establishment of performance goals, the amount of any Performance Award pool or potential individual Performance Awards and as to the achievement of performance goals relating to Performance Awards under Section 8(b), and the amount of any Annual Incentive Award pool or potential individual Annual Incentive Awards and the amount of final Annual Incentive Awards under Section 8(c), shall be made in writing in the case of any Award intended to qualify under Code Section 162(m). The Committee may not delegate any responsibility relating to such Performance Awards or Annual Incentive Awards.

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(e) Status of Section 8(b) and Section 8(c) Awards Under Code Section 162(m). It is the intent of the Corporation that Performance Awards and Annual Incentive Awards under Sections 8(b) and 8(c) hereof granted to persons who are designated by the Committee as likely to be Covered Employees within the meaning of Code Section 162(m) and regulations thereunder (including Regulation 1.162-27 and successor regulations thereto) shall, if so designated by the Committee, constitute “performance-based compensation” within the meaning of Code Section 162(m) and regulations thereunder. Accordingly, the terms of Sections 8(b), (c), (d) and (e), including the definitions of Covered Employee and other terms used therein, shall be interpreted in a manner consistent with Code Section 162(m) and regulations thereunder. If any provision of the Plan as in effect on the date of adoption or any agreements relating to Performance Awards or Annual Incentive Awards that are designated as intended to comply with Code Section 162(m) does not comply or is inconsistent with the requirements of Code Section 162(m) or regulations thereunder, such provision shall be construed or deemed amended to the extent necessary to conform to such requirements.

9. Change of Control. In the event of a “Change of Control,” the following provisions shall apply unless otherwise provided in the Award agreement:

(a) Options and SARs . Any Option or SAR carrying a right to exercise that was not previously exercisable and vested shall become fully exercisable and vested as of the time of the Change of Control and shall remain exercisable and vested for the balance of the stated term of such Option or SAR without regard to any termination of employment by the Participant, subject only to applicable restrictions set forth in Section 10(a) hereof;

(b) Restricted Stock and Deferred Stock Units . The restrictions, deferral of settlement, and forfeiture conditions applicable to any Restricted Stock or Deferred Stock Unit granted under the Plan shall lapse and such Awards shall be deemed fully vested as of the time of the Change of Control, except to the extent of any waiver by the Participant and subject to applicable restrictions set forth in Section 10(a) hereof; and

(c) Other Awards . The rights and obligations respecting, and the payment of, all other Awards under the Plan shall be governed solely by the provisions of the Severance Benefit Plan.

10. General Provisions.

(a) Compliance with Legal and Other Requirements. The Corporation may, to the extent deemed necessary or advisable by the Committee, postpone the issuance or delivery of Stock or payment of other benefits under any Award until completion of such registration or qualification of such Stock or other required action under any federal or state law, rule or regulation, listing or other required action with respect to any stock exchange or automated quotation system upon which the Stock or other securities of the Corporation are listed or quoted, or compliance with any other obligation of the Corporation, as the Committee may consider appropriate, and may require any Participant to make such representations, furnish such information and comply with or be subject to such other conditions as it may consider appropriate in connection with the issuance or delivery of Stock or payment of other benefits in compliance with applicable laws, rules, and regulations, listing requirements, or other obligations. The foregoing notwithstanding, in connection with a Change of Control, the Corporation shall take or cause to be taken no action, and shall undertake or permit to arise no legal or contractual obligation, that results or would result in any postponement of the issuance or delivery of Stock or payment of benefits under any Award or the imposition of any other conditions on such issuance, delivery or payment, to the extent that such postponement or other condition would represent a greater burden on a Participant than existed on the 90th day preceding the Change of Control.

(b) Limits on Transferability; Beneficiaries. No Award or other right or interest of a Participant under the Plan shall be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of such Participant to any party (other than the Corporation or a subsidiary), or assigned or transferred by such Participant otherwise than by will or the laws of descent and distribution or to a Beneficiary upon the death of a Participant, and such Awards or rights that may be exercisable shall be exercised during the lifetime of the Participant only by the Participant or his or her guardian or legal representative, except that Awards and other rights (other than ISOs and SARs in tandem therewith) may be transferred to one or more Beneficiaries or other transferees during the lifetime of the Participant, and may be exercised by such transferees in accordance with the terms of such Award, but only if and to the extent such transfers are permitted by the Committee pursuant to the express terms of an Award agreement (subject to any terms and conditions which the Committee may impose thereon). A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Award agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.

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(c) Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Stock, or other property), recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange, liquidation, dissolution or other similar corporate transaction or event affects the Stock such that an adjustment is determined by the Committee to be appropriate under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and kind of shares of Stock which may be delivered in connection with Awards granted thereafter, (ii) the number and kind of shares of Stock by which annual per-person Award limitations are measured under Section 5 hereof, (iii) the number and kind of shares of Stock subject to or deliverable in respect of outstanding Awards and (iv) the exercise price, grant price or purchase price relating to any Award and/or make provision for payment of cash or other property in respect of any outstanding Award. In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards (including Performance Awards and performance goals, and Annual Incentive Awards and any Annual Incentive Award pool or performance goals relating thereto) in recognition of unusual or nonrecurring events (including, without limitation, events described in the preceding sentence, as well as acquisitions and dispositions of businesses and assets) affecting the Corporation, any subsidiary or any business unit, or the financial statements of the Corporation or any subsidiary, or in response to changes in applicable laws, regulations, accounting principles, tax rates and regulations or business conditions or in view of the Committee’s assessment of the business strategy of the Corporation, any subsidiary or business unit thereof, performance of comparable organizations, economic and business conditions, personal performance of a Participant, and any other circumstances deemed relevant; provided that no such adjustment shall be authorized or made if and to the extent that such authority or the making of such adjustment would cause Options, SARs, Performance Awards granted under Section 8(b) hereof or Annual Incentive Awards granted under Section 8(c) hereof to Participants designated by the Committee as Covered Employees and intended to qualify as “performance-based compensation” under Code Section 162(m) and regulations thereunder to otherwise fail to qualify as “performance-based compensation” under Code Section 162(m) and regulations thereunder.

(d) Taxes. The Corporation and any subsidiary is authorized to withhold from any Award granted, any payment relating to an Award under the Plan, including from a distribution of Stock, or any payroll or other payment to a Participant, amounts of withholding and other taxes due or potentially payable in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Corporation and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award. This authority shall include authority to withhold or receive Stock or other property and to make cash payments in respect thereof in satisfaction of a Participant’s tax obligations, either on a mandatory or elective basis in the discretion of the Committee. However, this authority shall not include withholding of taxes above the statutorily required withholding amounts where such excess withholding would result in an earnings charge to the Corporation under U.S. Generally Accepted Accounting Principles.

(e) Changes to the Plan and Awards. The Board, or the Committee acting pursuant to such authority as may be delegated to it by the Board, may amend, alter, suspend, discontinue or terminate the Plan or the Committee’s authority to grant Awards under the Plan without the consent of shareholders or Participants, except that any amendment or alteration to the Plan shall be subject to the approval of the Corporation’s shareholders not later than the annual meeting next following such Board action if such shareholder approval is required by any federal or state law or regulation or the rules of any stock exchange or automated quotation system on which the Stock may then be listed or quoted, and the Board may otherwise, in its discretion, determine to submit other such changes to the Plan to shareholders for approval; provided that, without the consent of an affected Participant, no such Board action may materially and adversely affect the rights of such Participant under any previously granted and outstanding Award. The Committee may waive any conditions or rights under, or amend, alter, suspend, discontinue or terminate any Award theretofore granted and any Award agreement relating thereto, except as otherwise provided in the Plan; provided that, without the consent of an affected Participant, no such Committee action may materially and adversely affect the rights of such Participant under such Award. Notwithstanding anything in the Plan to the contrary, if any right under this Plan would cause a transaction to be ineligible for pooling of interest accounting that would, but for the right hereunder, be eligible for such accounting treatment, the Committee may modify or adjust the right so that pooling of interest accounting shall be available, including the substitution of Stock having a Fair Market Value equal to the cash otherwise payable hereunder for the right which caused the transaction to be ineligible for pooling of interest accounting.

(f) Limitation on Rights Conferred Under Plan. Neither the Plan nor any action taken hereunder shall be construed as (i) giving any Eligible Person or Participant the right to continue as an Eligible Person or Participant or in the employ or service of the Corporation or a subsidiary, (ii) interfering in any way with the right of the Corporation or a subsidiary to terminate any Eligible Person’s or Participant’s employment or service at any time, (iii) giving an Eligible Person or Participant any claim to be granted any Award under the Plan or to be treated uniformly with other Participants and employees, or (iv) conferring on a Participant any of the rights of a shareholder of the Corporation unless and until the Participant is duly issued or transferred shares of Stock in accordance with the terms of an Award.

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(g) Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant or obligation to deliver Stock pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Corporation; provided that the Committee may authorize the creation of trusts and deposit therein cash, Stock, other Awards or other property, or make other arrangements to meet the Corporation’s obligations under the Plan. Such trusts or other arrangements shall be consistent with the “unfunded” status of the Plan unless the Committee otherwise determines with the consent of each affected Participant. The trustee of such trusts may be authorized to dispose of trust assets and reinvest the proceeds in alternative investments, subject to such terms and conditions as the Committee may specify and in accordance with applicable law.

(h) Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board nor its submission to the shareholders of the Corporation for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other compensation and incentive arrangements for employees, agents and brokers of the Corporation and its subsidiaries as it may deem desirable.

(i) Payments in the Event of Forfeitures; Fractional Shares. Unless otherwise determined by the Committee, in the event of a forfeiture of an Award with respect to which a Participant paid cash or other consideration, the Participant shall be repaid the amount of such cash or other consideration. No fractional shares of Stock shall be issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

(j) Governing Law. The validity, construction and effect of the Plan, any rules and regulations under the Plan, and any Award agreement shall be determined in accordance with Indiana law, without giving effect to principles of conflicts of laws, and applicable federal law.

(k) Awards Under Preexisting Plans . No further awards shall be granted under the Preexisting Plans, after the Effective Date with respect to the EVSP and after Midnight, May 15, 1997 with respect to the Stock Option Plan. The Committee may waive any conditions or rights under or amend or alter any awards granted under the Preexisting Plans to the extent provided in either (i) the Preexisting Plan under which the award was made or (ii) Section 10(e) hereof.

(l) Plan Effective Date and Shareholder Approval. The Plan was originally adopted by the Board as of the Effective Date, subject to approval by the shareholders of the Corporation on May 15, 1997, was amended and restated by the Board on March 8, 2001, subject to approval by the shareholders of the Corporation on April 10, 2001, was again amended and restated by the Board on March 25, 2005, subject to approval by the shareholders of the Corporation on May 12, 2005, and was again amended and restated by the Board on February 22, 2007, subject to approval by the shareholders of the Corporation on May 10, 2007.

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E xhibit 5

LINCOLN NATIONAL CORPORATION

STOCK OPTION PLAN

FOR NON-EMPLOYEE DIRECTORS

1. Purpose . The purpose of this Stock Option Plan for Non-Employee Directors (the “Plan”) is to assist Lincoln National Corporation, an Indiana corporation (the “Corporation”) in attracting, retaining, and rewarding the services of experienced and knowledgeable non-employee directors, and to encourage non-employee directors of the Corporation to acquire or increase a proprietary interest in the Corporation in order to strengthen the mutuality of interests between such persons and the Corporation’s shareholders.

2. Definitions . For purposes of the Plan, the following terms shall be defined as set forth below, in addition to such terms defined in Section 1 hereof:

(a) “Beneficiary” means the person, persons, trust or trusts which have been designated by a Participant in his or her most recent written beneficiary designation filed with the Committee to receive the benefits specified under the Plan upon such Participant’s death or to which Options or other rights are transferred if and to the extent permitted under Section 8(b) hereof. If, upon a Participant’s death, there is no designated Beneficiary or surviving designated Beneficiary, then the term Beneficiary means the person, persons, trust or trusts entitled by will or the laws of descent and distribution to receive such benefits.

(b) “Board” means the Corporation’s Board of Directors.

(c) “Cause” means (as determined by the Committee in its sole discretion) the Participant’s (i) dishonesty, (ii) refusal to perform his or her duties for the Corporation, (iii) engaging in conduct that could be materially damaging to the Corporation without a reasonable good faith belief that such conduct is in the best interests of the Corporation, or (iv) any other reason that the Committee determines in its sole discretion constitutes Cause.

(d) “Change of Control” has the same meaning as set forth in the Lincoln National Corporation Executives’ Severance Benefit Plan.

(e) “Code” means the Internal Revenue Code of 1986, as amended from time to time, including regulations thereunder and successor provisions and regulations thereto.

(f) “Committee” means, at any date, each of those members of the Corporate Governance Committee of the Board of Directors of the Corporation who shall be: (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, unless administration of the Plan by “non-employee directors” is not then required in order for exemptions under Rule 16b-3 to apply to transactions under the Plan, and (ii) an “outside director” as defined under Code Section 162(m), unless the action taken pursuant to the Plan is not required to be taken by “outside directors” in order to qualify for tax deductibility under Code Section 162(m). Unless otherwise designated by the Board, the Committee shall include not fewer than three members. In the event that fewer than three members of the Committee are eligible to serve on the Committee, the Board may appoint one or more of its other members who is otherwise eligible to serve on the Committee until such time as three members of the Committee are eligible to serve.

(g) “Director” means a member of the Board .

(h) “Effective Date” means May 10, 2007, the date on which the Plan was approved by the shareholders of the Corporation at the 2007 Annual Meeting of Shareholders.

(i) “Eligible Director” means each Director who is not an employee of the Corporation or any subsidiary of the Corporation.

(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

(k) “Fair Market Value” means the Fair Market Value of Stock or other property as determined by the Committee or under procedures established by the Committee. Unless otherwise determined by the Committee, the Fair Market Value of Stock shall be the closing price of a share of Stock as quoted on the composite transactions table on the New York Stock Exchange on the date of grant.

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(l) “Option” means a non-qualified stock option, granted to a Participant under Section 6(b) hereof, to purchase Stock at a specified price during specified time periods.

(m) “Participant” means an Eligible Director who has been granted an Option under the Plan which remains outstanding, including a person who is no longer an Eligible Director.

(n) “Rule 16b-3” means Rule 16b-3, as from time to time in effect and applicable to the Plan and Participants, promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act or any similar law or regulation that may be a successor thereto.

(o) “Stock” means the Corporation’s Common Stock, and such other securities as may be substituted (or re-substituted) for Stock pursuant to Section 8(c) hereof.

3. Administration .

(a) Authority of the Committee. The Plan shall be administered by the Committee. The Committee shall have full and final authority, in each case subject to and consistent with the provisions of the Plan, to interpret the provisions of the Plan, determine questions of eligibility, grant Options, determine the number and other terms and conditions of, and all other matters relating to, Options, prescribe Option agreements (which need not be identical for each Participant), adopt, amend and rescind rules and regulations for the administration of the Plan, construe and interpret the Plan and Option agreements and correct defects, supply omissions or reconcile inconsistencies therein, ensure that awards continue to qualify under Rule 16b-3, and make all other decisions and determinations as the Committee may deem necessary or advisable for the administration of the Plan.

(b) Manner of Exercise of Committee. Any action of the Committee shall be final, conclusive and binding on all persons, including the Corporation, Participants, Beneficiaries, transferees under Section 8(b) hereof or other persons claiming rights from or through a Participant, and shareholders. The Committee shall exercise its authority only by a majority vote of its members at a meeting, or in lieu of a meeting by a writing signed by a majority of its members. The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of the Committee. The Committee may delegate to officers or managers of the Corporation or any subsidiary, or committees thereof, the authority, subject to such terms as the Committee shall determine, (i) to perform administrative functions, and (ii) to perform such other functions of the Committee as the Committee may determine to the extent performance of such functions will not result in the loss of an exemption under Rule 16b-3 otherwise available for transactions by such persons, in each case to the extent permitted under applicable law. The Committee may appoint agents to assist it in administering the Plan.

4. Stock Subject to Plan .

(a) Overall Number of Shares Available for Delivery. Subject to adjustment as provided in Section 8(c) hereof, the total number of shares of Stock reserved and available for delivery in connection with Options under the Plan shall be 500,000, as approved by the Corporation’s Shareholders at the May 10, 2007 Annual Meeting of Shareholders.

(b) Application of Limitation to Grants of Options. No Option may be granted if the number of shares of Stock to be delivered in connection with such Option exceeds the number of shares of Stock remaining available under the Plan minus the number of shares of Stock issuable in settlement of then-outstanding Options (whether or not then vested and exercisable). The Committee may adopt reasonable counting procedures to ensure appropriate counting, and make adjustments if the number of shares of Stock actually delivered differs from the number of shares previously counted in connection with an Option.

E - 19

(c) Availability of Shares Not Delivered Under Options . Shares of Stock subject to an Option under the Plan that is canceled, expired, forfeited, settled in cash or otherwise terminated without a delivery of shares to the Participant will again be available to grant as Options under the Plan ; except that if any such shares could not again be available to grant as Options to a particular Participant under any applicable law or regulation, such shares shall be available exclusively for Options to Participants who are not subject to such limitation.

5. Eligibility . Options may be granted under the Plan only to Eligible Directors.

6. Specific Terms of Options .

(a) General. Options may be granted on the terms and conditions set forth in this Section 6. In addition, the Committee may impose on any Option or the exercise thereof, at the date of grant or thereafter (subject to Section 8(e)), such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including terms requiring forfeiture of Options in the event of the Participant’s termination of service as a Director. The Committee shall retain full power and discretion to accelerate, waive or modify, at any time, any term or condition of an Option that is not mandatory under the Plan.

(b) Options. The Committee is authorized to grant Options to Participants on the following terms and conditions:

(ii) Time and Method of Exercise. The Committee shall determine, at the date of grant or thereafter, the time or times at which or the circumstances under which an Option may be exercised in whole or in part, the methods by which such exercise price may be paid or deemed to be paid, the form of such payment, including, without limitation, cash, Stock or other property (including notes or other contractual obligations of Participants to make payment on a deferred basis), and the methods by or forms in which Stock will be delivered or deemed to be delivered to Participants.

(iii) Effect of Termination of Service. Except as otherwise provided in the Plan and the applicable Option agreement, in the event that a Participant terminates his or her service as a Director other than for Cause, (i) an Option may be exercised only to the extent vested and exercisable on the date of termination, and (ii) any Option (or portion thereof) which is not vested and exercisable on the date of termination shall terminate and be forfeited on such date. If the services of a Participant are terminated for Cause, his or her Option (whether vested or unvested) shall terminate and be forfeited as of the date of termination.

(c) Change of Control. Unless otherwise provided in the applicable Option agreement, in the event of a “Change of Control,” any Option that was not previously exercisable and vested shall become fully exercisable and vested as of the time of the Change of Control and shall remain exercisable and vested for the balance of the stated term of such Option without regard to any termination of the Participant’s service as a Director, subject only to applicable restrictions set forth in Section 8(a) hereof.

7. Certain Other Provisions.

(a) No Repricing. Notwithstanding any other provision of this Plan, no Option that has been granted by the Corporation shall be thereafter repriced, replaced or regranted through cancellation, or otherwise modified without shareholder approval (except in connection with a change in the Corporation’s capitalization in accordance with Section 8(c) hereof), if the effect would be to reduce the exercise price for the shares underlying such Option.

(b) Term of Options. The term of each Option shall be for such period as may be determined by the Committee; provided that in no event shall the term of any Option exceed a period of ten (10) years.

(c) Settlement of Options. Subject to the terms of the Plan and any applicable Option agreement, payments to be made by the Corporation upon the exercise of an Option shall be made in Stock. The settlement of any Option may be accelerated, and cash paid in lieu of Stock in connection with such settlement, in the discretion of the Committee or upon occurrence of one or more events specified in the Option agreement.

E - 20

(d) Exemptions from Section 16(b) Liability. It is the intent of the Corporation that the grant of any Options to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt under Rule 16b-3 (except for transactions acknowledged in writing to be non-exempt by such Participant). Accordingly, if any provision of this Plan or any Option agreement does not comply with the requirements of Rule 16b-3 as then applicable to any such transaction, unless the Participant shall have acknowledged in writing that a transaction pursuant to such provision is to be non-exempt, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Participant shall avoid liability under Section 16(b) of the Exchange Act.

(e) Rescission.

(i) A Participant shall not, without the prior written authorization of the Corporation, disclose to anyone outside the Corporation, or use in other than the Corporation’s business, any material confidential information relating to the business of the Corporation that is acquired by the Participant either during or after his or her service as a Director.

(ii) Failure to comply with the requirements of subparagraph (i) above prior to, or during the six months after, any exercise, payment or delivery of Stock pursuant to an Option shall cause such exercise, payment or delivery to be rescinded. The Corporation shall notify the Participant in writing of any such rescission within two years after such exercise, payment or delivery; provided, however, that the Corporation may, in its discretion, in any individual case provide for waiver in whole or in part of compliance with subparagraph (i). Within ten days after receiving such a notice from the Corporation, the Participant shall pay to the Corporation the amount of any gain realized or payment received as a result of the rescinded exercise, payment or delivery. Such payment shall either be made in cash or by returning to the Corporation the number of shares of Stock that the Participant received in connection with the rescinded exercise, payment or delivery.

8. General Provisions .

(b) Limits on Transferability; Beneficiaries. No Option or other right or interest of a Participant under the Plan shall be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of such Participant to any party (other than the Corporation), or assigned or transferred by such Participant otherwise than by will or the laws of descent and distribution or to a Beneficiary upon the death of a Participant, and such Options or rights that may be exercisable shall be exercised during the lifetime of the Participant only by the Participant or his or her guardian or legal representative, except that Options may be transferred to one or more Beneficiaries or other transferees during the lifetime of the Participant, and may be exercised by such transferees in accordance with the terms of such Option, but only if and to the extent such transfers are permitted by the Committee pursuant to the express terms of an Option agreement (subject to any terms and conditions which the Committee may impose thereon). A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Option agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.

E - 21

(d) Taxes. If and to the extent required by applicable law, the Corporation is authorized to withhold all required local, state, federal, foreign or other taxes and any other amount required to be withheld by any governmental authority or law from any amount payable with respect to an Option, and to take such other action as the Committee may deem advisable to enable the Corporation and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Option. This authority shall include authority to withhold or receive Stock or other property and to make cash payments in respect thereof in satisfaction of a Participant’s tax obligations, either on a mandatory or elective basis in the discretion of the Committee. However, this authority shall not include withholding of taxes above the statutorily required withholding amounts where such excess withholding would result in an earnings charge to the Corporation under U.S. Generally Accepted Accounting Principles.

(e) Changes to the Plan and Options. The Board, or the Committee acting pursuant to such authority as may be delegated to it by the Board, may amend, alter, suspend, discontinue or terminate the Plan or the Committee’s authority to grant Options under the Plan without the consent of shareholders or Participants, except that any amendment or alteration to the Plan shall be subject to the approval of the Corporation’s shareholders not later than the annual meeting next following such Board action if such shareholder approval is required by any federal or state law or regulation or the rules of any stock exchange or automated quotation system on which the Stock may then be listed or quoted, and the Board may otherwise, in its discretion, determine to submit other such changes to the Plan to shareholders for approval; provided that, without the consent of an affected Participant, no such Board action may materially and adversely affect the rights of such Participant under any previously granted and outstanding Option. The Committee may waive any conditions or rights under, or amend, alter, suspend, discontinue or terminate any Option theretofore granted and any Option agreement relating thereto, except as otherwise provided in the Plan; provided that, without the consent of an affected Participant, no such Committee action may materially and adversely affect the rights of such Participant under such Option.

(f) Limitation on Rights Conferred Under Plan. Neither the Plan nor any action taken hereunder shall be construed as (i) giving any Eligible Director or Participant the right to continue as an Eligible Director or Participant or serve as a Director for any period of time or to continue his present or any other rate of compensation, (ii) giving an Eligible Director or Participant any claim to be granted any Option under the Plan or to be treated uniformly with other Participants, or (iii) conferring on a Participant any of the rights of a shareholder of the Corporation unless and until the Participant is duly issued or transferred shares of Stock in accordance with the terms of an Option.

(g) Unfunded Status of Plan. The Plan is intended to constitute an “unfunded” plan. With respect to any payments not yet made to a Participant or obligation to deliver Stock pursuant to an Option, nothing contained in the Plan or any Option agreement shall give any such Participant any rights that are greater than those of an unsecured creditor of the Corporation.

(h) Non-exclusive Nature of the Plan. Neither the adoption of the Plan by the Board nor its submission to the shareholders of the Corporation for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other compensation and incentive arrangements for Eligible Directors of the Corporation as it may deem desirable.

(i) Fractional Shares. No fractional shares of Stock shall be issued or delivered pursuant to the Plan or any Option. The Committee shall determine whether cash or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

(j) Governing Law. The validity, construction and effect of the Plan, any rules and regulations under the Plan, and any Option agreement shall be determined in accordance with Indiana law, without giving effect to principles of conflicts of laws, and applicable federal law.

(k) Effective Date and Term of Plan. The Plan shall become effective on the Effective Date; provided that the Plan is approved by the shareholders of the Corporation at the annual meeting of shareholders on that date. No Option shall become exercisable or otherwise realizable prior to such annual meeting. The Plan shall terminate as of the close of business on the tenth anniversary of the Effective Date, unless sooner terminated by action of the Board. No Option may be granted after termination of the Plan, but such termination shall not affect the validity of any Option then outstanding.

E - 22

PROXY STATEMENT	1
SECURITY OWNERSHIP	3
GOVERNANCE OF THE COMPANY	6
THE BOARD OF DIRECTORS AND COMMITTEES	12
ITEM 1 - ELECTION OF DIRECTORS	14
Nominees for Director	14
Directors Continuing in Office	16
ITEM 2 - RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	18
Independent Registered Public Accounting Firm Fees and Services	18
Audit Committee Pre-Approval Policy	19
Audit Committee Report	19
ITEM 3 - APPROVAL OF THE LINCOLN NATIONAL CORPORATION AMENDED AND RESTATED INCENTIVE COMPENSATION PLAN	20
ITEM 4 - APPROVAL OF THE LINCOLN NATIONAL CORPORATION STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS	27
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE	30
COMPENSATION PROCESSES AND PROCEDURES	30
EXECUTIVE COMPENSATION	31
Compensation Discussion & Analysis	31
Compensation Committee Report	44
Summary Compensation Table	45
Grants of Plan-Based Awards	47
Outstanding Equity Awards at Fiscal Year-End	50
Option Exercises and Stock Vested	52
Pension Benefits	53
Nonqualified Deferred Compensation	5 6
Potential Payments Upon Termination or Change-In-Control	58
COMPENSATION OF DIRECTORS	66
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION	68
RELATED PARTY TRANSACTIONS	68
GENERAL	69
Shareholder Proposals	69
Annual Report	70
EXHIBIT 1 - Section 10 - Notice of Shareholder Business
EXHIBIT 2 - Section 11 - Notice of Shareholder Nominees
EXHIBIT 3 - Policy Regarding Approval of Services of Independent Auditor
EXHIBIT 4 - Lincoln National Corporation Amended and Restated Incentive Compensation Plan
EXHIBIT 5 - Lincoln National Corporation Stock Option Plan for Non-Employee Directors

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AS OF DECEMBER 31, 2006
TITLE OF CLASS	NAME AND ADDRESS OF BENEFICIAL OWNER	AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP	PERCENT OF CLASS
Common Stock	Neuberger Berman Inc. 605 Third Avenue New York, NY 10158	14,214,869 shares	5.125%

SECURITY OWNERSHIP OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS AS OF MARCH 5, 2007
NAME	AMOUNT OF LNC COMMON STOCK AND NATURE OF BENEFICIAL OWNERSHIP ¹	PERCENT OF CLASS	LNC STOCK UNITS ²	TOTAL OF LNC COMMON STOCK AND STOCK UNITS	TOTAL PERCENT OF CLASS
William J. Avery	9,640	*	11,334	20,974	*
J. Patrick Barrett	32,574	*	37,553	70,127	*
Jon A. Boscia	1,639,647	*	53,473	1,693,120	*
Patrick P. Coyne	1,011	*	4,857	5,868	*
Frederick J. Crawford	50,648	*	3,531	54,179	*
William H. Cunningham	74,950	*	12,037	86,987	*
Dennis R. Glass	1,321,925	*	--	1,321,925	*
John H. Gotta	--	*	8,676	8,676	*
George W. Henderson, III	74,318	*	18,891	93,209	*
Eric G. Johnson	17,796	*	18,672	36,468	*
M. Leanne Lachman	21,508	*	29,644	51,152	*
Warren A. May	61,025	*	--	61,025	*
Michael F. Mee	8,508	*	13,054	21,562	*
William P. Payne	84,761	*	10,252	95,013	*
Patrick S. Pittard	86,790	*	12,030	98,820	*
Jill S. Ruckelshaus	25,908	*	10,642	36,550	*
David A. Stonecipher	2,424,178	*	--	2,424,178	*
Westley V. Thompson	181,870	*	29,802	211,672	*
Isaiah Tidwell	10,030	*	2,299	12,328	*
*All Directors and Executive Officers as a group -28 persons*	6,893,920	2.44%	331,016	7,224,936	2.55%

Name	Audit	Compensation	Corporate Governance	Finance	Corporate Action ¹
William J. Avery	M
J. Patrick Barrett			M
Jon A. Boscia					C
William H. Cunningham		C		M
Dennis R. Glass					M
George W. Henderson, III	M			M
Eric G. Johnson				C
M. Leanne Lachman	C
Michael F. Mee		M		M
William P. Payne			C
Patrick S. Pittard		M
Jill S. Ruckelshaus			M
David A. Stonecipher
Isaiah Tidwell	M		M
Number of Meetings in 2006:	10	9	6	4	--

	Fiscal Year Ended -December 31, 2006		% of Total Fees		Fiscal Year Ended -December 31, 2005		% of Total Fees
Audit Fees		10,017,627		83.3	$	7,830,649		82.9
Audit-Related Fees		2,006,249		16.7	$	1,553,626		16.5
Tax Fees		--		--	$	57,093		0.6
All Other Fees		13,500		*		--		--
TOTAL FEES:		12,037,376		100.0	$	9,441,368		100.0

	1) Amount Previously Paid:
	2) Form, Schedule or Registration Statement No.:

Name & Title	Total Number of Plan Awards Outstanding ¹
Jon A. Boscia Chairman and CEO of LNC	2,334,870
Frederick J. Crawford Senior Vice President & CFO of LNC	192,726
Dennis R. Glass President and COO of LNC	282,421
Patrick P. Coyne President of Lincoln National Investment Company, Inc. and Delaware Management Holdings, Inc.	37,041
Westley V. Thompson President of Employer Markets	413,039

John H. Gotta Former President and CEO of The Lincoln National Insurance Company	8,676
Warren H. May Former President of Lincoln Financial Distributors, Inc.	--
All Executive Officers (including those above), as a Group	4,424,909
Non-Executive Officers Employee Group	6,085,894

	Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)	Weighted- average exercise price of outstanding options, warrants and rights (b)	Number of securities remaining available for future issuance under equity compensation (excluding securities reflected in column (a)) (c)
Equity compensation plans approved by shareholders	17,995,312 ⁽¹⁾	$45.13	5,936,049 ⁽²⁾
Equity compensation plans not approved by shareholders	None	-	-

· AEGON USA	· ING
· Aetna	· Met Life
· AFLAC	· Nationwide
· AIG	· Phoenix
· Allianz (Life USA)	· Principal
· Allstate	· Prudential
· AXA (Equitable)	· Sun Life
· CIGNA	· UNUM Provident
· The Hartford

· American Century Investments	· Loomis, Sayles & Company, L.P.
· AXA Rosenberg Investment Management	· Lord, Abbett & Co. LLC
· Babson Capital Management LLC	· Mellon Capital Management Corp.
· Brandes Investment Partners, L.P.	· Neuberger Berman, LLC
· Eaton Vance Management	· The Phoenix Companies, Inc.
· Harris Associates, L.P.	· Russell Investment Group
· Jennison Associates, LLC	· Western Asset Management Co.

NEOs	Base Salaries	“At Risk Compensation” 2006 AIP 2006 LTI
Jon A. Boscia, Chairman and CEO of LNC	$925,000	$2,312,500	$4,865,500
Frederick J. Crawford, CFO of LNC	$400,000	$700,000	$700,000
Dennis R. Glass, ¹ President and COO	$900,000	$1,102,500	$2,475,000
Patrick P. Coyne, ² President, Lincoln National Investment Company, Inc. and Delaware Management Holdings, Inc.	$450,000	$2,250,000	$675,000
Westley V. Thompson, President, Employer Markets	$500,000	$1,018,134	$1,018,134
Warren H. May, ¹ Former President of Lincoln Financial Distributors, Inc.	$347,106	$663,750	$663,750

Performance Measure (Corporate Executives, including Jon A. Boscia, Frederick J. Crawford, and Dennis R. Glass)	Relative Weight	Goal at Minimum	Goal at Target	Goal at Maximum	Actual Performance Results
Growth in Income from Operations Per Diluted Share	50%	$4.55	$4.70	$4.95	$5.25 (200%)
Growth in Sales (Gross Deposits & Life Sales)	30%	5%	10%	20%	23.9% (200%)
Merger-Related Cost Savings (2006 Realized Savings Expressed in Millions)	20%	$49.5	$55	$60.5	$76.4 (200%)

2006 AIP: Performance Measures for Patrick P. Coyne	Relative Weight	Goal at Minimum	Goal at Target	Goal at Maximum	Actual Performance Results
Corporate: Growth in Income from Operations Per Diluted Share	15%	$4.55	$4.70	$4.95	$5.25 (200%)
Corporate: Growth in Sales (Gross Deposits & Life Sales)	5%	5%	10%	20%	23.9% (200%)
Corporate: Merger-Related Cost Savings (2006 Realized Savings in millions)	5%	$49.5	$55	$60.5	$76.4 (200%)
Income from Operations/Line of Business Earnings as % of Financial Plan	20%	$34.1	$35.9	$37.7	$55.1 (200%)
Growth in Sales for the Business Unit	20%	5%	10%	20%	49.4% (200%)
Line of Business Merger-Related Cost Savings as a % of Financial Plan	15%	$4.1	$4.6	$5.1	$4.9 (160%)
Retail Investment Performance*	10%	60%	65%	70%	69.2% (184%)
Institutional Investment Performance*	10%	62.5%	75%	87.5%	72.5% (90%)

2006-2008 LTI Performance Award Measures	Relative Weight
Growth in Income from Operations Per Diluted Share	33 1/3%
Growth in Sales (Gross Deposits & Life Sales)	33 1/3%
Return on Equity Based on Income from Operations	33 1/3%

	3) Filing Party:
	4) Date Filed:

Performance Measure	Relative Weight	Goal at Minimum	Goal at Target	Goal at Maximum	Actual Performance Results
Growth in Income from Operations Per Diluted Share	40%	9%	12%	15%	16.1%
Total Shareholder Return	20%	25 ^th percentile	60 ^th percentile	75 ^th percentile	73 ^rd percentile
Return on Equity	40%	12%	14%	15%	14.1%

Performance Measure	Relative Weight	Goal at Minimum*	Goal at Target*	Goal at Maximum*	Actual Performance Results
Growth in Income from Operations Per Diluted Share	40%	25 ^th percentile	60 ^th percentile	75 ^th percentile	77.7 ^th percentile
Total Shareholder Return	40%	25 ^th percentile	60 ^th percentile	75 ^th percentile	33.33 ^rd percentile
Return on Equity	20%	25 ^th percentile	60 ^th percentile	75 ^th percentile	88.8 ^th percentile

Position	Expected Level of Ownership Multiple of Base Salary
CEO	5 times base salary
President & COO	4 times base salary
Managing Senior Contributor (EVP or equivalent)	3 times base salary
Senior Contributor (SVP or equivalent)	2 times base salary
VP (or equivalent)	1 times base salary

Officer Position	Expected Level of 2007 Ownership Multiple of Base Salary
CEO	5 times base salary
President & COO	4 times base salary
Executive Officers (other than the CEO and COO)	3 times base salary
Corporate Leadership Group (CLG)	2 times base salary

· Aetna	· MetLife
· Allstate	· Nationwide
· Amerus	· Phoenix Sun
· CIGNA	· Principal
· Genworth	· Prudential
· The Hartford	· UNUM Provident


SUMMARY COMPENSATION TABLE
NAME AND PRINCIPAL POSITION (a)	YEAR (b)	SALARY ($) (c)	STOCK AWARDS ($) ¹ (e)	OPTIONS AWARDS ($) ¹ (f)	NON-EQUITY INCENTIVE PLAN COMPENSATION ($) ² (g)	CHANGE IN PENSION VALUE AND NON-QUALIFIED DEFERRED COMPENSATION EARNINGS ($) ³ (h)	ALL OTHER COMPEN-SATION ($) ⁴ (i)	TOTAL ($) (j)
JON A. BOSCIA Chairman and CEO of LNC	2006	925,000	617,687	6,591,815	7,393,423	2,140,170	460,810 ⁶	18,128,905
FREDERICK J. CRAWFORD CFO of LNC	2006	400,000	921,525	116,169	1,495,830	121,313	76,850	3,131,687
DENNIS R. GLASS ⁵ President and COO of LNC	2006	700,000	1,366,623	--	2,205,000	432,573	504,708 ⁷	5,208,904
PATRICK P. COYNE President, Lincoln National Investment Company, Inc. and Delaware Management Holdings, Inc.	2006	395,000	22,816	759,210	4,081,500	--	231,554	5,490,080
WESTLEY V. THOMPSON President, Employer Markets	2006	500,000	1,905,653	218,176	1,527,201	186,878	163,083 ⁸	4,500,991
JOHN H. GOTTA Former President and CEO of The Lincoln National Life Insurance Company	2006	360,000	1,825,320	259,963	--	265,236	2,909,414 ⁹	5,619,933
WARREN H. MAY Former President of Lincoln Financial Distributors, Inc.	2006	347,106	363,250	178,057	--	260,614	3,586,448 ¹⁰	4,735,475


		ESTIMATED POSSIBLE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS ²			ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS
NAME (a)	GRANT DATE (b)	THRESH- OLD ($) (c)	TARGET ($) (d)	MAXI- MUM ($) (e)	THRESHOLD (#) (f)	TARGET (#) (g)	MAXI- MUM (#) (h)	ALL OTHER STOCK AWARDS: NUMBER OF SHARES OF STOCK OR UNITS (#) (i)	ALL OTHER OPTION AWARDS: NUMBER OF SECURITIES UNDER- LYING OPTIONS (#) (j)	EXERCISE OR BASE PRICE OF OPTION AWARDS ($/SH) ⁶ (k)	CLOSING PRICE ON GRANT DATE ($/SH) (l)	GRANT DATE FAIR VALUE OF STOCK AND OPTION AWARDS ($) ⁸ (n)

JON A. BOSCIA	1/05/2006 ¹							--	15,152	53.91	54.12	51,517
	4/10/2006 ¹								14,282	57.19	57.05	21,709
	4/13/2006	1,156,250	2,312,500	4,625,000
	4/13/2006 ³				21,714	43,427	85,854					2,432,781
	4/13/2006 ³								278,375	56.02	56.30	3,259,771
	5/4/2006 ¹								13,780	59.27	58.03	7,441
FREDERICK J. CRAWFORD	4/13/2006	350,000	700,000	1,400,000
	4/13/2006 ³				3,124	6,248	12,496					350,013
	4/13/2006 ⁴							6,000				325,200
	4/13/2006 ³								40,050	56.02	56.30	468,986
DENNIS R. GLASS	4/13/2006	551,250	1,102,500	2,205,000				--	--	--	--
	4/13/2006 ³				11,046	22,091	44,182					1,237,538
	4/13/2006 ⁵				3,682	7,364	14,728					412,531
	4/13/2006 ⁵				7,364	14,727	29,454					825,007
PATRICK P. COYNE	11/8/2006 ⁵	1,125,000	2,250,000	4,500,000
	11/8/2006 ³				2,597	5,194	10,388					337,558
	11/8/2006 ³								7,000	209.38	N/A	446,530 ⁷
WESTLEY V. THOMPSON	4/13/2006	509,067	1,108,134	2,036,268				--
	4/13/2006 ³				4,544	9,088	18,176					509,110
	4/13/2006 ³								58,252	56.02	56.30	682,131
	6/8/2006 ³				756	1,511	3,022					86,097
JOHN H. GOTTA	--	--	--	--	--	--	--	--	--	--	--	--


WARREN H. MAY	4/13/2006 ⁹	331,875	663,750	1,327,500				--	--	--	--
	4/13/2006 ^3,9				2,936	5,872	11,744					328,949
	4/13/2006 ^5,9				1,958	3,915	7,830					219,318
	4/13/2006 ^5,9				979	1,958	3,916					109,687


OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
OPTION AWARDS						STOCK AWARDS
NAME (a)	NUMBER OF SECURITIES UNDERLY- ING UNEXER- CISED OPTIONS (#) EXERCIS- ABLE ¹ (b)	NUMBER OF SECURITIES UNDERLY- ING UNEXER- CISED OPTIONS (#) UNEXER- CISABLE ¹ (c)	EQUITY INCENTIVE PLAN AWARDS: NUMBER OF SECURITIES UNDERLY- ING UNEXER- CISED UNEARNED OPTIONS (#) (d)	OPTION EXERCISE PRICE ($) (e)	OPTION EXPIRATION DATE (f)	NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#) (g)	MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ⁶ ($) (h)	EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#) (i)	EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ⁶ ($) (j)
JON A. BOSCIA	52,000			29.47	05/14/07	--	--	48,980 ³	3,252,272
	220,000			44.93	05/13/08			78,255 ⁴	5,196,132
	200,000			50.83	05/12/09			88,532 ⁵	5,878,525
	100,000			24.72	03/09/10
	184,000			43.48	03/08/11
	200,000			52.10	03/14/12
			272,827 ³	47.58	03/11/14
			301,385 ⁴	46.77	03/10/15
		278,375 ⁵		56.02	04/13/16
FREDERICK J. CRAWFORD	4,000		--	43.48	03/08/11	6,116 ⁷	406,100	16,802 ³	1,115,653
	5,000			52.10	03/14/12			33,692 ⁴	2,237,149
		40,050 ⁵		56.02	04/13/16			12,738 ⁵	845,803
	49,077		--	42.33	02/07/09	--	--	12,181 ³	808,818
	81,795			32.97	02/13/10			30,024 ⁴	1,993,594
	155,510			42.68	02/11/11			45,036 ⁵	2,990,390
DENNIS R. GLASS	109,060			43.82	02/10/12
	109,060			34.58	02/09/13
	109,060			44.26	11/24/13
	109,060			48.58	02/08/14
	272,650			45.73	02/13/15
		278,103		53.60	02/12/16
	23,500		--	139.62	03/14/12	--	--	10,388 ⁵	689,763
	4,283	4,282		130.47	03/13/13
PATRICK P. COYNE	15,000	15,000		154.22	05/13/14
	5,000	15,000		60.55	04/15/15
		7,000		209.38 ²	11/08/16
	8,000		--	38.66	01/01/08	--	--	48,824 ³	3,241,914
	10,000			44.93	05/13/08			67,384 ⁴	4,474,298
	7,200			45.52	08/12/08			21,588 ⁵	1,433,443
WESTLEY V. THOMPSON	20,000			50.83	05/12/09
	23,000			43.48	03/08/11
	20,000			52.10	03/14/12
		7,163		51.77	03/09/10
		58,252		56.02	04/13/16
	23,800	--		50.83	05/12/09	--	--	--	--
JOHN H. GOTTA	55,000			52.10	03/14/12
	19,147			49.80	03/09/10
	54,530			53.60	12/30/11			11,970 ⁸	794,808
WARREN H. MAY		--	--			--	--	7,981 ⁸	529,938
								3,219 ⁸	213,742

Expiration Dates	Vesting Begins
5/14/07	5/14/98
1/1/08	1/1/99
5/13/08	5/13/99
5/12/09	5/12/00
3/9/10	3/9/01
8/12/08	8/12/99
3/8/11	3/8/02
3/14/12	3/14/03
3/13/13	3/13/04
5/13/14	5/13/05
4/15/15	4/15/06
11/08/16	11/08/07

OPTION EXERCISES AND STOCK VESTED
	OPTION AWARDS		STOCK AWARDS
NAME (a)	NUMBER OF SHARES ACQUIRED ON EXERCISE (#) (b)	VALUE REALIZED ON EXERCISE ($) ¹ (c)	NUMBER OF SHARES ACQUIRED ON VESTING (#) (d)	VALUE REALIZED ON VESTING ($) (e)
JON A. BOSCIA	65,434	1,203,074	125,222 ²	6,779,519 ⁴
FREDERICK J. CRAWFORD	--	--	7,466 ²	404,209 ⁴
DENNIS R. GLASS	92,018	3,242,273	--	--
PATRICK P. COYNE	15,484	74,975	--	--
WESTLEY V. THOMPSON	46,075	1,463,816	17,016 ^2,3	921,246 ⁴
JOHN H. GOTTA	92,130	1,438,185	63,724 ⁵	3,611,876 ⁵
WARREN H. MAY	152,684	2,544,762	--	--


PENSION BENEFITS
NAME (a)	PLAN NAME ¹ (b)	NUMBER OF YEARS CREDITED SERVICE (#) (c)	PRESENT VALUE OF ACCUMULATED BENEFIT ($) (d)	PAYMENTS DURING LAST FISCAL YEAR ($) (e)


JON A. BOSCIA	LNC Retirement Plan	23	524,973	--
	Excess Compensation Pension Benefit Plan	23	2,372,238
	Salary Continuation Plan	5	5,059,110
FREDERICK J. CRAWFORD	LNC Retirement Plan	N/A ²	73,143	--
	Excess Compensation Pension Benefit Plan	N/A ²	120,104
	Salary Continuation Plan	5	71,539
DENNIS R. GLASS	Jefferson-Pilot Retirement Plan	12	258,237	--
	Employment Agreement	13	236,174
	Jefferson-Pilot ESSB	13	2,075,599
	Jefferson-Pilot Supplemental Pension Benefit Plan	12	860,818
PATRICK P. COYNE ³	--	--	--	--


WESTLEY V. THOMPSON	LNC Retirement Plan	13	167,676	--
	Excess Compensation Pension Benefit Plan	13	453,120
	Salary Continuation Plan	5	114,022
JOHN H. GOTTA ⁴	LNC Retirement Plan	12.8		216,403
	Excess Compensation Pension Benefit Plan	12.8	645,744	--
	Salary Continuation Plan	5	113,668	--
WARREN H. MAY ⁵	Jefferson-Pilot ESSB	4	533,387	--

NONQUALIFIED DEFERRED COMPENSATION
NAME (a)	EXECUTIVE CONTRIBUTIONS IN LAST FY ¹ ($) (b)	REGISTRANT CONTRIBUTIONS IN LAST FY ² ($) (c)	AGGREGATE EARNINGS IN LAST FY ($) (d)	AGGREGATE WITHDRAWALS/ DISTRIBUTIONS ($) (e)	AGGREGATE BALANCE AT LAST FYE ³ ($) (f)
JON A. BOSCIA	332,481	398,129	554,538	--	5,452,840
FREDERICK J. CRAWFORD	350,784	60,442	42,359	--	636,814
DENNIS R. GLASS	--	--	--	--	--
PATRICK P. COYNE	198,828	199,679	154,178	--	1,998,559
WESTLEY V. THOMPSON	1,054,650 ⁴	135,571	340,657	--	2,708,207
JOHN H. GOTTA	45,000	143,078	57,347	--	1,726,953
WARREN H. MAY	--	--	--	--	--

Chief Executive Officer and President/COO	3 times the annual base salary	Plus	3 times the target bonus
All Other Participating Executives (including our other NEOs)	2 times the annual base salary	Plus	2 times the target bonus


	TRIGGER EVENTS
Benefits and Payments	Voluntary Termination		Involuntary Not for Cause Termination		For Cause Termination		Involuntary Termination After Change-in- Control		Disability		Death
Annual Incentive Compensation (AIP)	$	4,625,000	$	4,625,000	$	4 ,625,000	$	4,625,000	$	4,625,000	$	4,625,000

Long-Term Incentive Compensation:
Stock Options	$	0	$	32,972,415	$	0	$	32,972,415	$	32,972,415	$	32,972,415
Equity Incentive Plan Awards	$	0	$	8,410,888	$	0	$	*	$	8,410,888	$	8,410,888
Non-equity Incentive Plan Awards	$	0	$	5,056,422	$	0	$	*	$	5,056,422	$	5,056,422

Benefits & Perquisites:
Retirement Plan	$	454,131	$	483,748	$	454,131	$	483,748	$	604,562	$	431,539
Excess Retirement Plan	$	2,349,646	$	2,349,646	$	2,349,646	$	3,689,529	$	5,147,320	$	2,372,238
Salary Continuation Plan	$	0	$	3,092,629	$	0	$	12,004,979	$	5,147,096	$	11,269,095
Health and Welfare Benefits	$	0		0		0	$	21,421	$	165,955	$	0
Excise Tax & Gross-Up	$	0	$	0	$	0	$	0	$	0	$	0
Cash Severance	$	0	$	925,000	$	0	$	9,414,191	$	0	$	0
* If change-in-control occurs, the Compensation Committee will make determination, considering the nature of change-in-control, whether to pay awards for an LTI award cycle.


	TRIGGER EVENT
Benefits and Payments		Early Retirement

Long-Term Incentive Compensation:
Stock Options	$	1,567,772	¹
Equity Incentive Plan Awards	$	3,611,817	¹
Non-equity Incentive Plan Awards	$	365,750	¹

Benefits & Perquisites:
Retirement Plan	$	216,403
Excess Retirement Plan	$	645,744
Salary Continuation Plan	$	113,668
Health and Welfare Benefits	$	62,868
Cash Severance	$	2,392,756


	TRIGGER EVENT
Benefits and Payments		Involuntary Termination AfterChange-in-Control
Annual Incentive Compensation, plus accrued interest (AIP)	$	696,938

Long-Term Incentive Compensation:
Stock Options	$	697,792
Performance Shares (LTI)	$	0
Cash	$	428,557

Benefits & Perquisites:
Stock Awards	$	0
ESSB	$	533,387
Life Insurance Premiums ¹	$	2,212
Excise Tax Gross-Up ²	$	1,588,750
Cash Severance	$	1,677,630
Relocation	$	175,163
Outplacement Allowance	$	30,000

COMPENSATION OF DIRECTORS
Name* (a)	Fees Earned or Paid in Cash ¹ ($) (b)	Stock Awards ^2,3 ($) (c)	Change in Pension Value and Nonqualified Deferred Compensa- tion Earnings (d)	All Other Compensation ($) (e)	Total ($) (f)
Marcia J. Avedon ⁴	20,660	20,660	--	--	41,320
William J. Avery	80,000	80,000	--	15,317 ^5,7	175,317
J. Patrick Barrett	113,512	80,000	--	--	193,512
Jenne K. Britell ⁴	20,660	20,660	--	--	41,320
William H. Cunningham ⁶	63,750	60,000	--	10,000 ⁷	133,750
George W. Henderson, III ⁶	71,760	60,000	--	--	131,760
Eric G. Johnson	85,000	80,000	--	--	165,000
M. Leanne Lachman	104,400	80,000	--	10,000 ⁷	194,400
Michael F. Mee	80,000	80,000	--	--	160,000
William Porter Payne ⁶	63,750	60,000	--	--	123,750
Patrick S. Pittard ⁶	60,000	60,000	--	--	120,000
Ron J. Ponder ⁴	25,660	20,660	--	--	46,320
Jill S. Ruckelshaus	99,400	80,000	^--8	10,000 ⁷	189,400
David A. Stonecipher ⁶	--	--	--	137,986 ⁹	137,986
Isaiah Tidwell ⁶	60,000	60,000	--	9,500 ⁷	129,500
Glenn F. Tilton ¹⁰	80,000	80,000	--	10,124 ⁵	170,124