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Indiana
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1-6028
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35
-1140070
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(State
or other jurisdiction
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(Commission
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(IRS
Employer
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of
incorporation)
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File
Number)
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Identification
No.)
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[
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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[
]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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[
]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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[
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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| 1. |
The
merger integration remains on track with realized pre-tax savings
in the
quarter of $18 million, yielding an annualized run-rate savings of
approximately $75 million and on course for achieving the $90 million
run-rate savings target in the first year after closing the merger.
LNC
maintains its three-year, annualized run-rate merger savings estimate
of
$180 million.
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| 2. |
During
the remainder of 2006, Lincoln intends to repurchase up to $150 million
of
shares of our common stock. This reflects the previously announced
execution of a $350 million accelerated stock buyback program, which
is
described in our Form 8-K filed with the SEC on August 14,
2006.
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·
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Problems
arising with the ability to successfully integrate our and
Jefferson-Pilot’s businesses, which may affect our ability to operate as
effectively and efficiently as expected or to achieve the expected
synergies from the merger or to achieve such synergies within our
expected
timeframe, and the application of purchase price accounting on results
of
operations;
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·
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Legislative,
regulatory or tax changes, both domestic and foreign, that affect
the cost
of, or demand for, LNC’s products, the required amount of reserves and/or
surplus, or otherwise affect our ability to conduct business, including
changes to statutory reserves and/or risk-based capital requirements
related to secondary guarantees under universal life and variable
annuity
products such as Actuarial Guideline 38; restrictions on revenue
sharing
and 12b-1 payments; and the potential for U.S. Federal tax
reform;
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·
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The
initiation of legal or regulatory proceedings against LNC or its
subsidiaries and the outcome of any legal or regulatory proceedings,
such
as: (a) adverse actions related to present or past business practices
common in businesses in which LNC and its subsidiaries compete;
(b) adverse decisions in significant actions including, but not
limited to, actions brought by federal and state authorities, and
extra-contractual and class action damage cases; (c) new decisions
that result in changes in law; and (d) unexpected trial court
rulings;
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·
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Changes
in interest rates causing a reduction of investment income, the margins
of
LNC’s fixed annuity and life insurance businesses and demand for LNC’s
products;
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·
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A
decline in the equity markets causing a reduction in the sales of
LNC’s
products, a reduction of asset fees that LNC charges on various investment
and insurance products, an acceleration of amortization of deferred
acquisition costs, the value of business acquired, deferred sales
inducements and deferred front-end loads and an increase in liabilities
related to guaranteed benefit features of LNC’s variable annuity
products;
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·
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Ineffectiveness
of LNC’s various hedging strategies used to offset the impact of declines
in and volatility of the equity
markets;
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·
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A
deviation in actual experience regarding future persistency, mortality,
morbidity, interest rates or equity market returns from LNC’s assumptions
used in pricing its products, in establishing related insurance reserves,
and in the amortization of intangibles that may result in an increase
in
reserves and a decrease in net
income;
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·
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Changes
in accounting principles generally accepted in the United States
(“GAAP”)
that may result in unanticipated changes to LNC’s net
income;
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·
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Lowering
of one or more of LNC’s debt ratings issued by nationally recognized
statistical rating organizations, and the adverse impact such action
may
have on LNC’s ability to raise capital and on its liquidity and financial
condition;
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·
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Lowering
of one or more of the insurer financial strength ratings of LNC’s
insurance subsidiaries, and the adverse impact such action may have
on the
premium writings, policy retention, and profitability of its insurance
subsidiaries;
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Significant
credit, accounting, fraud or corporate governance issues that may
adversely affect the value of certain investments in the portfolios
of
LNC’s companies requiring that LNC realize losses on such
investments;
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·
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The
impact of acquisitions and divestitures, restructurings, product
withdrawals and other unusual items, including LNC’s ability to integrate
acquisitions and to obtain the anticipated results and synergies
from
acquisitions;
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The
adequacy and collectibility of reinsurance that LNC has
purchased;
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Acts
of terrorism or war that may adversely affect LNC’s businesses and the
cost and availability of
reinsurance;
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Competitive
conditions, including pricing pressures, new product offerings and
the
emergence of new competitors, that may affect the level of premiums
and
fees that LNC can charge for its
products;
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·
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The
unknown impact on LNC’s business resulting from changes in the
demographics of LNC’s client base, as aging baby-boomers move from the
asset-accumulation stage to the asset-distribution stage of
life;
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Loss
of key management, portfolio managers in the Investment Management
segment, financial planners or wholesalers;
and
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Changes
in general economic or business conditions, both domestic and foreign,
that may be less favorable than expected and may affect foreign exchange
rates, premium levels, claims experience, the level of pension benefit
costs and funding, and investment
results.
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Lincoln
National Corporation
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By:
/s/
Frederick
J. Crawford
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Frederick
J. Crawford
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Senior
Vice President and
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Chief
Financial Officer
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