SEC Company Response from LINCOLN NATIONAL CORP (LNC, LNC-PD) (CIK 0000059558) (LNC) — Mar 30, 2010
LINCOLN NATIONAL CORP (LNC, LNC-PD) (CIK 0000059558)
Date: March 30, 2010 · CIK: 0000059558 · Accession: 0000059558-10-000114
AI Filing Summary & Sentiment
Reasoning
Letter
Securities and Exchange Commission Washington, D.C. 20549 Re: Lincoln National Corporation Preliminary Proxy Statement filed March 12, 2010 File No. 1-06028
Dear Mr. Riedler:
This letter is in response to the staff of the Division of Corporation Finance’s (the “Staff”) letter of March 29, 2010, concerning Lincoln National Corporation’s (“LNC” or the “Company”) Preliminary Proxy Statement filed March 12, 2010. Our reply refers to the specific comments in the Staff’s letter. In responding to the Staff’s comments, we acknowledge the following:
·
The Company is responsible for the adequacy and accuracy of the disclosure in the filing;
·
Staff comments or changes to disclosure in response to Staff comments do not foreclose the commission from taking any action with respect to the filing; and
·
The Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
The following are the Staff’s comments and our responses:
Preliminary Proxy Statement filed March 12, 2010
Executive Compensation, Page
The 2009-2011 Performance Award Cycle, page 39
1.
We have reviewed your response regarding prior comment four. Please supplementally provide us with an example of how the disclosure of the target level of Growth in Income from Operations per Diluted Share which you established for your 2009-2011 Performance Award Cycle, when combined with your releases of historical earnings results, would provide your competitors with information to then alter their own strategic plans accordingly to more effectively compete with you in the market place. Alternatively, please revise your disclosure to disclose this target level.
Page
March 30,
In re: Lincoln National Corporation
Response:
We have carefully considered the Staff’s request for us to disclose the target level of Growth in Income from Operations per Diluted Share which was established for the 2009-2011 Performance Award Cycle. Although, as previously noted, we believe that disclosure of this information is not material in the context of our executive compensation policies or decisions because the disclosure that is currently included in the Preliminary Proxy Statement provides the material details of the compensation opportunity for our NEOs under the 2009-2011 Performance Award Cycle, we would propose revising the current disclosure provided on page 39 substantially as follows:
The Committee also set minimum, target, and maximum performance achievement levels for this measure at its March, 2009 meeting. In setting the goals to be achieved with respect to the 2009-2011 LTI performance measure, both management and the Compensation Committee set the target at a level intended to present a substantial challenge for management. The target level was set based on internal goals and is designed to create an appropriate incentive for our executives to create financial growth and enhanced value for shareholders. The target level was set at a twelve percent compounded annual growth rate over the three-year performance cycle period. This target was set for compensation purposes only and does not constitute, and should not be viewed as, management’s projection of future results. Whether we meet or exceed this target goal will depend upon performance over the entire three-year performance cycle.
The degree of difficulty for an NEO to achieve the target level of performance for the Growth in Income from Operations per Diluted Share measure over a three-year cycle can be seen by looking at historical results. In each of the last three completed performance cycles, Growth in Income from Operations per Diluted Shares was one of 3 measures, and in each case the target level of performance for this measure was not achieved. For the 2005-2007 Performance Cycle, this measure resulted in a payout at 35% of target, and for the 2006-2008 and 2007-2009 Performance Cycles, this measure resulted in no payout at all, which is consistent with our policy of tying incentive compensation to performance.
****
If you have any questions regarding our response, please contact me directly at (484) 583-1475.
Sincerely,
/s/ Charles A.
Brawley
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lnccorrespondence.htm
Lincoln
National Corporation
150 N.
Radnor-Chester Road
Radnor,
PA 19087
phone
484-583-1430
March 30,
2010
Mr.
Jeffrey Riedler
Assistant
Director
Securities
and Exchange Commission
100 F.
Street, N.E.
Washington,
D.C. 20549
Re: Lincoln
National Corporation
Preliminary
Proxy Statement filed March 12, 2010
File
No. 1-06028
Dear Mr.
Riedler:
This
letter is in response to the staff of the Division of Corporation Finance’s (the
“Staff”) letter of March 29, 2010, concerning Lincoln National Corporation’s
(“LNC” or the “Company”) Preliminary Proxy Statement filed March 12,
2010. Our reply refers to the specific comments in the Staff’s
letter. In responding to the Staff’s comments, we acknowledge the
following:
·
The
Company is responsible for the adequacy and accuracy of the disclosure in
the filing;
·
Staff
comments or changes to disclosure in response to Staff comments do not
foreclose the commission from taking any action with respect to the
filing; and
·
The
Company may not assert Staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal securities
laws of the United States.
The
following are the Staff’s comments and our responses:
Preliminary Proxy Statement
filed March 12, 2010
Executive Compensation, Page
26
The 2009-2011 Performance
Award Cycle, page 39
1.
We
have reviewed your response regarding prior comment
four. Please supplementally provide us with an example of how
the disclosure of the target level of Growth in Income from Operations per
Diluted Share which you established for your 2009-2011 Performance Award
Cycle, when combined with your releases of historical earnings results,
would provide your competitors with information to then alter their own
strategic plans accordingly to more effectively compete with you in the
market place. Alternatively, please revise your disclosure to
disclose this target level.
Page
March 30,
2010
In re:
Lincoln National Corporation
Response:
We have
carefully considered the Staff’s request for us to disclose the target level of
Growth in Income from Operations per Diluted Share which was established
for the 2009-2011 Performance Award Cycle. Although, as previously
noted, we believe that disclosure of this information is not material in the
context of our executive compensation policies or decisions because the
disclosure that is currently included in the Preliminary Proxy Statement
provides the material details of the compensation opportunity for our NEOs under
the 2009-2011 Performance Award Cycle, we would propose revising the current
disclosure provided on page 39 substantially as follows:
The
Committee also set minimum, target, and maximum performance achievement levels
for this measure at its March, 2009 meeting. In setting the goals to
be achieved with respect to the 2009-2011 LTI performance measure, both
management and the Compensation Committee set the target at a level intended to
present a substantial challenge for management. The target level was
set based on internal goals and is designed to create an appropriate incentive
for our executives to create financial growth and enhanced value for
shareholders. The target level was set at a twelve percent compounded annual
growth rate over the three-year performance cycle period. This target
was set for compensation purposes only and does not constitute, and should not
be viewed as, management’s projection of future results. Whether we
meet or exceed this target goal will depend upon performance over the entire
three-year performance cycle.
The degree of difficulty
for an NEO to achieve the target level of performance for the Growth in
Income from Operations per Diluted Share measure over a three-year cycle can be
seen by looking at historical results. In each of the last three
completed performance cycles, Growth in Income from Operations per Diluted
Shares was one of 3 measures, and in each case the target level of performance
for this measure was not achieved. For the 2005-2007 Performance
Cycle, this measure resulted in a payout at 35% of target, and for the 2006-2008
and 2007-2009 Performance Cycles, this measure resulted in no payout at all,
which is consistent with our policy of tying incentive compensation to
performance.
****
If you
have any questions regarding our response, please contact me directly at (484)
583-1475.
Sincerely,
/s/ Charles A.
Brawley
Charles
A. Brawley, III
Vice
President, Assistant General Counsel & Secretary
cc: Frederick
J. Crawford, Executive Vice President & Chief Financial
Officer