Edgar Filing: LINCOLN NATIONAL CORP

lnlagents401k.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSIOIN

Washington, D.C. 20549

FORM 11- K

FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS

AND SIMILARY PLANS PURSUANT TO SECTION 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2011

[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ________

Commission File Number 1-6028

A.	Full title of the plan and the address of the plan, if different from that of the issuer named below:

LNL AGENTS’ 401(k) SAVINGS PLAN

B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

Lincoln National Corporation

150 N. Radnor Chester Road

Radnor, PA 19087

REQUIRED INFORMATION

Financial statements and schedule for LNL Agents’ 401(k) Savings Plan, prepared in accordance with the financial reporting requirements of the Employee Retirement Income Security Act of 1974, are contained in this Annual Report on Form 11-k.

	AUDITED FINANCIAL STATEMENTS AND
	SUPPLEMENTAL SCHEDULE

	LNL Agents’ 401(k) Savings Plan

	(Formerly The Lincoln National Life Insurance Company Agents’ Savings and Profit-Sharing Plan)

	As of December 31, 2011 and 2010, and for the Three Years
	Ended December 31, 2011, 2010 and 2009

	With Report of Independent Registered Public Accounting Firm

LNL Agents’ 401(k) Savings Plan

(Formerly The Lincoln National Life Insurance Company

Agents’ Savings and Profit-Sharing Plan)

Audited Financial Statements

and Supplemental Schedule

As of December 31, 2011 and 2010, and for the

Three Years Ended December 31, 2011, 2010 and 2009

Contents

Report of Independent Registered Public Accounting Firm

Audited Financial Statements

Statements of Net Assets Available for Benefits

Statements of Changes in Net Assets Available for Benefits

Notes to Financial Statements

Supplemental Schedule

Schedule H, Line 4i – Schedule of Assets (Held at End of Year)

Report of Independent Registered Public Accounting Firm

Lincoln National Corporation Plan Administrator

Lincoln National Corporation

We have audited the accompanying statements of net assets available for benefits of LNL Agents’ 401(k) Savings Plan (Formerly The Lincoln National Life Insurance Company Agents’ Savings and Profit-Sharing Plan) as of December 31, 2011 and 2010, and the related statements of changes in net assets available for benefits for each of the three years in the period ended December 31, 2011. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2011, and 2010, and the changes in its net assets available for benefits for each of the three years in the period ended December 31, 2011, in conformity with U.S. generally accepted accounting principles.

Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2011, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. Such information is the responsibility of the Plan's management. The information has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania

March 30, 2012

LNL Agents’ 401(k) Savings Plan

(Formerly The Lincoln National Life Insurance Company

Agents’ Savings and Profit-Sharing Plan)

Statements of Net Assets Available for Benefits


	As of December 31,
	2011		2010
Assets
Investments:
Mutual funds (cost: 2011 - $51,424,390; 2010 - $56,241,358)	$	55,855,399	$	67,303,010
Collective investment trusts (cost: 2011 - $31,892,348; 2010 - $23,500,126)		39,320,637		30,839,384
Common stock - Lincoln National Corporation
(cost: 2011 - $22,347,447; 2010 - $20,582,923)		20,158,162		26,755,825
Investment contracts - The Lincoln National Life Insurance Company		37,076,901		36,183,046
Wilmington Trust money market funds		1,061,021		1,054,789
Brokerage account (cost: 2011 - $2,552,926; 2010 - $2,126,815)		2,342,040		2,176,011
Total investments		155,814,160		164,312,065

Notes receivable from participants		3,859,370		3,875,700
Accrued interest receivable		78,218		65,454
Contributions receivable from Sponsor company		361,358		205,463
Total assets		160,113,106		168,458,682

Liabilities
Due to (from) broker		234,146		238,401
Total liabilities		234,146		238,401
Net assets available for benefits	$	159,878,960	$	168,220,281

See accompanying notes to Financial Statements

LNL Agents’ 401(k) Savings Plan

(Formerly The Lincoln National Life Insurance Company

Agents’ Savings and Profit-Sharing Plan)

Statements of Changes in Net Assets Available for Benefits

	For the Years Ended December 31,
	2011			2010			2009
Investment income:
Cash dividends	$	1,627,967		$	1,283,770		$	1,033,993
Interest		1,322,907			1,606,174			1,728,784
Total investment income		2,950,874			2,889,944			2,762,777

Net realized gain (loss) on sale and distributions of investments:
Mutual funds		2,493,610			925,684			(2,592,510	)
Collective investment trusts		1,287,008			1,116,307			(597,295	)
Common stock - Lincoln National Corporation		890,394			1,931,327			(5,869,682	)
Brokerage account		(48,343	)		100,546			-
Total realized gain (loss)		4,622,669			4,073,864			(9,059,487	)

Net change in unrealized appreciation (depreciation)
of investments		(15,163,969	)		12,543,324			40,916,992

Contributions:
Participants		7,099,035			7,076,063			7,252,863
Sponsor company		2,117,518			2,007,331			1,735,437
Total contributions		9,216,553			9,083,394			8,988,300

Transfers from (to) affiliated plans		837,266			1,092,826			97,748

Distributions to participants		(10,803,998	)		(15,772,704	)		(18,114,613	)
Administrative expenses		(716	)		(2,394	)		(869	)
Total distributions and expenses		(10,804,714	)		(15,775,098	)		(18,115,482	)

Net increase (decrease) in net assets available for benefits		(8,341,321	)		13,908,254			25,590,848
Net assets available for benefits at beginning-of-year		168,220,281			154,312,027			128,721,179
Net assets available for benefits at end-of-year	$	159,878,960		$	168,220,281		$	154,312,027

See accompanying notes to Financial Statements

LNL Agents’ 401(k) Savings Plan

(Formerly The Lincoln National Life Insurance Company

Agents’ Savings and Profit-Sharing Plan)

Notes to Financial Statements

1. Description of the Plan

The following description of the LNL Agents’ 401(k) Savings Plan (“Plan”) is a summary only and a detailed Plan document can be obtained from Human Resources. The Plan is intended to be qualified under Internal Revenue Code section 401(a) by the terms and provisions of the Plan document and in operation.

Effective January 1, 2012, the Plan’s name was changed from The Lincoln National Life Insurance Company Agents’ Savings and Profit-Sharing Plan to LNL Agents’ 401(k) Savings Plan.

The Plan is a contributory, defined contribution plan that covers eligible full-time agents of The Lincoln National Life Insurance Company (“LNL” or “Plan Sponsor”), Lincoln Financial Advisors Corporation (“LFA”), Jefferson-Pilot Corporation (“JP”) and Lincoln Life & Annuity Company of New York.

Participants are permitted to make pre-tax contributions or elect to reduce their compensation to make Roth 401(k) contributions at a combined rate of at least 1% but not more than 50% of eligible earnings (10% for highly compensated agents, as defined in the Plan document, beginning January 1, 2008), up to a maximum annual amount as determined under applicable law. Roth 401(k) contributions are includable in a participant’s gross income at the time of deferral and must be irrevocably designated as Roth 401(k) contributions. The Plan, although not subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), is administered in accordance with the provisions of ERISA.

Plan Sponsor matching contributions are made to the participants’ accounts in accordance with the Plan. The Plan Sponsor matching contribution for eligible participants is equal to 50% of each participant’s contributions, not to exceed 6% of eligible earnings. In addition, the Plan Sponsor may contribute an additional discretionary match to eligible LFA participants. The Plan Sponsor discretionary match is an amount determined by the sole discretion of the Lincoln National Corporation (“LNC”) Board of Directors. One requirement for eligibility for the discretionary match is that the participant must have an agent relationship with LNL or an affiliate as of the last day of the year or have died, retired or became disabled during the year. The amount of the Plan Sponsor discretionary matching contribution varies according to whether LFA has met certain performance-based criteria, as determined by the Compensation Committee of LNC’s Board of Directors.

Participants’ contributions and any earnings thereon are fully vested at all times. Plan Sponsor contributions vest based upon years of service as defined in the Plan document as follows:

	Years of Service		Percent Vested
	1		0%
	2		50%
	3 or more		100%

Participants direct the Plan to invest their contributions, the basic Plan Sponsor matching contributions, and the Plan Sponsor discretionary matching contribution in any combination of the investment options offered under the Plan.

The Plan Sponsor has the right to discontinue contributions at any time and terminate the Plan in accordance with the provisions of ERISA. In the event of Plan termination, all non-vested amounts allocated to participant accounts will become fully vested.

The Plan may make loans to participants in amounts up to 50% of the vested account value to a maximum of $50,000 reduced by the highest outstanding loan balance in the previous 12-month period. Interest charged on new loans to participants is established monthly based upon the prime rate plus 1%. Interest income credited on loans was $195,389, $218,998 and $238,346 in 2011, 2010 and 2009, respectively. Loans may be repaid over any period selected by the participant up to a maximum repayment period of 5 years except that the maximum repayment period may be 20 years for the purchase of a principal residence.

Upon termination of service, retirement or disability, a participant may elect to receive either a lump-sum amount equal to the entire value of the participant’s vested account or an installment option if certain criteria are met. In cases of death, the participant’s beneficiary makes that election. Vested account balances less than $1,000 are immediately distributable as a lump-sum under the terms of the Plan without the participant’s consent, unless the participant has made a timely election of rollover to an Individual Retirement Account or other qualified arrangement.

Each participant’s account is credited with the participant’s contributions, Plan Sponsor contributions and applicable investment earnings thereon, and is charged with an allocation of administrative expenses and applicable investment losses. Forfeited non-vested amounts are used to reduce future Plan Sponsor contributions. Forfeitures of $1,814, $5,281 and $11,141 were used to offset contributions in 2011, 2010 and 2009, respectively.

2. Summary of Significant Accounting Policies

Investments Valuation and Income Recognition

As of January 1, 2010, the TD Ameritrade broker investments (“brokerage account”) were added to the Plan’s investment options available to the participants. The brokerage account is administered by TD Ameritrade and allows participants to self-direct their contributions into mutual funds and securities within their brokerage account. The brokerage account primarily consists of mutual funds, securities and a money market account, which are stated at fair value as discussed below.

As of October 1, 2008, Wilmington Trust (“Trustee”) became the trustee for the Plan and Lincoln Alliance (“Recordkeeper”) assumed responsibility as the recordkeeper for the Plan. Prior to that date, Wells Fargo Bank (“WFB”) acted as the Plan’s trustee and recordkeeper.

As of December 31, 2011, the assets of the Plan consisted primarily of mutual funds, collective investment trusts, LNC common stock, investment contracts issued by LNL, Wilmington Trust money market funds (“money market funds”) and brokerage accounts. Marketable securities are stated at fair value based on quoted market prices in an active market at the Plan’s year end. The investment in LNC common stock is valued at the closing sales price reported on the New York Stock Exchange Composite Listing on the last business day of the Plan year. Securities traded on a national securities exchange are valued at the last reported sales price on the last business day of the Plan year. The fair value of ownership interest of the collective investment trusts is established by the Trustee based on the quoted redemption values of the underlying investments on the last business day of the Plan year. The money market fund, which approximates fair value, is also utilized by the Trustee to hold money that has been removed from the participants’ funds and is waiting for distribution to participants.

As described in Financial Accounting Standards Board (“FASB”) Accounting Standards CodificationTM (“ASC”) Fully Benefit-Responsive Investment Contracts Topic, investment contracts held by a defined contribution plan that are fully benefit responsive are required to be reported at fair value and an adjustment to total net assets is required to show net assets at contact value. The investment contracts held by the Plan are fully benefit responsive; therefore, contract value reporting is required. In this instance, contract value approximates fair value as a result of current interest rates credited to the contracts. Contract value represents net contributions plus interest at the contract rate.

The cost of investments sold, distributed or forfeited is determined using the specific identification method. Investment purchases and sales are accounted for on a trade-date basis.

Interest and dividend income are recorded when earned.

Notes Receivable from Participants

Notes receivable from participants are valued at unpaid principal balance plus any accrued interest.

Accounting Estimates and Assumptions

The accompanying financial statements are prepared in accordance with United States generally accepted accounting principles. Management is required to make estimates and assumptions affecting the amounts reported in the financial statements and accompanying notes. Those estimates are inherently subject to change and actual results could differ from those estimates.

Fair Value Measurement

The measurement of fair value is based on assumptions used by market participants in pricing the asset. The estimate of an exchange price is the price in an orderly transaction between market participants to sell the asset (“exit price”) in the principal market, or the most advantageous market in the absence of a principal market, for that asset, as opposed to the price that would be paid to acquire the asset (“entry price”). Pursuant to the Fair Value Measurements and Disclosures Topic of the FASB ASC, the financial instruments carried at fair value are categorized into a three-level fair value hierarchy, based on the priority of inputs to the respective valuation technique. The three-level hierarchy for fair value measurement is defined as follows:

Level 1 – Inputs to the valuation methodology are quoted prices available in active markets for identical investments as of the reporting date;

Level 2 – Inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value can be determined through the use of models or other valuation methodologies; and

Level 3 – Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The following is a description of the valuation methodologies used for instruments measured at fair value, including the general classification of such instruments pursuant to the fair value hierarchy.

Mutual funds, including those within the brokerage account, are public investment vehicles valued using the Net Asset Value (“NAV”) provided by the administrator of the fund and focused on accumulating earnings while maintaining the appropriate level of diversified risk. The NAV is a quoted price in an active market; therefore, the mutual funds are classified within Level 1 of the fair value hierarchy.

Collective investment trusts are public investment vehicles valued using the NAV provided by the Trustee and focused on stability of maintaining principal and a steady growth of earnings while matching the appropriate level of risk to the type of trust. The NAV is based on the value of the underlying assets owned by the trust, minus its liabilities, and then divided by the number of shares outstanding. The NAV is not a quoted price in an active market; therefore, the trusts are classified within Level 2 of the fair value hierarchy.

LNC common stock and common stock within the brokerage account are valued at the closing price reported on the New York Stock Exchange Composite Listing and is classified within Level 1 of the fair value hierarchy.

The Plan invests in an Unallocated Group Fixed Annuity Contract issued by LNL, who guarantees a fixed interest rate. The NAV for the investment contracts is $1. The investment contracts are classified within Level 3 of the fair value hierarchy.

The money market fund, including the money market fund within the brokerage account, is a public investment vehicle valued using $1 for the NAV. The money market fund is classified within Level 2 of the fair value hierarchy.

See “Fair Value of Financial Investments, Carried at Fair Value” in Note 5 for additional fair value disclosures.

Adoption of New Accounting Standards

In January 2010, the FASB issued ASU No. 2010-25, “Plan Accounting – Defined Contribution Pension Plans” (“ASU 2010-25”), which requires disclosure and measurement changes related to participant loans. For reporting purposes, participant loans shall be classified as notes receivable from participants and are no longer subject to fair value measurement disclosure requirements. In addition, notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. The Plan adopted the amendments in ASU 2010-25 effective January 1, 2010, and has retrospectively applied the amendments throughout the financial statements.

In January 2010, the FASB issued ASU No. 2010-06, “Improving Disclosures about Fair Value Measurements” (“ASU 2010-06”), which required additional disclosure related to the three-level fair value hierarchy. The Plan adopted the disclosure requirements related to significant transfers in and out of Levels 1 and 2 of the fair value hierarchy effective January 1, 2010. Effective January 1, 2011, the Plan adopted the remaining disclosure amendments in ASU 2010-06 requiring the Plan to separately present information related to purchases, sales, issuances and settlements in the reconciliation of fair value measurements classified as Level 3, and have included the disclosure in Note 5 for the year ended December 31, 2011.

Future Adoption of Accounting Standards

In May 2011, the FASB issued ASU No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards” (“ASU 2011-04”), which was issued to create a consistent framework for the application of fair value measurement across jurisdictions. The amendments include wording changes to GAAP in order to clarify the FASB’s intent about the application of existing fair value measurements and disclosure requirements, as well as to change a particular principle or existing requirement for measuring fair value or disclosing information about fair value measurements. There are no additional fair value measurements required upon the adoption of ASU 2011-04. The amendments are effective, prospectively, for interim and annual reporting periods beginning after December 15, 2011. Early adoption is prohibited. The Plan will adopt the provisions of ASU 2011-04 effective January 1, 2012. The adoption is not expected to have a material effect on the financial statements of the Plan.

3. Investments

The following is a summary of fair value of assets held for investment:

	As of December 31, 2011							As of December 31, 2010
	Number of		Net Asset					Number of		Net Asset
	Shares, Units		Value		Fair			Shares, Units		Value		Fair
	or Par Value		Per Unit		Value			or Par Value		Per Unit		Value
Mutual funds:
Columbia Acorn Z		414,900.327	$	27.56	$	11,434,653	*		408,884.266	$	30.19	$	12,344,216	*
Delaware Foundation®
Conservative Allocation Fund		133,776.955		9.59		1,282,921			112,110.833		9.84		1,103,171
Delaware Foundation®
Moderate Allocation Fund		285,643.233		10.64		3,039,244			278,779.346		10.87		3,030,331
Delaware Foundation®
Growth Allocation Fund		251,310.430		9.30		2,337,187			223,236.938		9.90		2,210,046
Delaware Mid Cap Value I		293,455.936		8.76		2,570,674			269,332.458		9.32		2,510,178
Dodge & Cox
International Stock		271,473.598		29.24		7,937,888	*		280,238.171		35.71		10,007,305	*
American Fund Growth
Fund of America R-5		422,297.768		28.68		12,111,500	*		423,783.248		30.39		12,878,773	*
Harbor International
Growth Institutional		-		-		-			663,556.602		12.37		8,208,195
Vanguard Institutional Index		95,068.446		115.04		10,936,674	*		94,505.708		115.01		10,869,101	*
Vanguard Extended Market
Index Institutional		106,879.969		39.34		4,204,658			100,356.034		41.27		4,141,694
Total mutual funds						55,855,399							67,303,010

Collective
investment trusts:
Delaware Large Cap
Value Trust		582,931.074		13.13		7,653,885			599,432.165		11.99		7,187,192
Delaware International
Equity Trust		101,463.650		6.85		695,026			77,191.410		8.01		618,303
Delaware Small Cap
Growth Trust		526,466.773		15.68		8,254,999	*		534,074.523		14.56		7,776,125
Delaware Diversified
Income Trust		672,024.149		14.99		10,073,642	*		710,455.865		14.01		9,953,487	*
Delaware Large Cap
Growth Trust		414,319.144		13.79		5,713,461			415,695.727		12.76		5,304,277
MFS International
Growth Fund		75,183.075		92.17		6,929,624			-		-		-
Total collective
investment trusts						39,320,637							30,839,384

Common stock - LNC		1,038,010.402		19.42		20,158,162	*		962,093.671		27.81		26,755,825	*

Contract Value
(approximates fair value):
Investment contracts - LNL		37,076,901		1.00		37,076,901	*		36,183,046		1.00		36,183,046	*

Wilmington Trust money
market fund		1,061,021		1.00		1,061,021			1,054,789		1.00		1,054,789

Brokerage account		2,342,040		1.00		2,342,040			2,176,011		1.00		2,176,011
Total investments					$	155,814,160						$	164,312,065

*	Investments that represent 5% or more of the fair value of net assets available for benefits as of the end of the year, respectively.

Net realized gain (loss) on sale and distribution of investments is summarized as follows:

	For the Years Ended December 31,
	2011			2010		2009
Mutual funds
Proceeds from disposition of units	$	17,970,451		$	13,661,847	$	19,232,229
Cost of units disposed		15,476,841			12,736,163		21,824,739
Net realized gain (loss) on sale and distribution
of mutual funds	$	2,493,610		$	925,684	$	(2,592,510	)

Collective investment trusts
Proceeds from disposition of units	$	6,706,870		$	6,644,723	$	9,479,171
Cost of units disposed		5,419,862			5,528,416		10,076,466
Net realized gain (loss) on sale and distribution
of collective investment trusts	$	1,287,008		$	1,116,307	$	(597,295	)

Common stock - LNC
Proceeds from disposition of stock	$	6,896,854		$	9,120,522	$	14,919,052
Cost of stock disposed		6,006,460			7,189,195		20,788,734
Net realized gain (loss) on sale and distribution
of common stock - LNC	$	890,394		$	1,931,327	$	(5,869,682	)

Brokerage account
Proceeds from disposition of units	$	463,136		$	290,345	$	-
Cost of units disposed		511,479			189,799		-
Net realized gain (loss) on sale and distribution
of brokerage account	$	(48,343	)	$	100,546	$	-

Total realized gain (loss) on sale and
distribution of investments	$	4,622,669		$	4,073,864	$	(9,059,487	)

The net change in unrealized appreciation (depreciation) of investments in total and by investment classification as determined by fair value is summarized as follows:

	For the Years Ended December 31,
	2011			2010		2009
Fair value in excess of (less than) cost:
Balance at beginning-of-year	$	24,623,008		$	12,079,684	$	(28,837,308	)
Balance at end-of-year		9,459,039			24,623,008		12,079,684
Change in net unrealized appreciation
(depreciation) of investments	$	(15,163,969	)	$	12,543,324	$	40,916,992

Mutual funds	$	(6,630,642	)	$	7,512,291	$	17,935,166
Collective investment trusts		89,030			3,600,775		6,849,449
Common stock - LNC		(8,362,186	)		1,381,062		16,132,377
Brokerage account		(260,171	)		49,196		-
Change in net unrealized appreciation
(depreciation) of investments	$	(15,163,969	)	$	12,543,324	$	40,916,992

The Plan holds investments in investment contracts. Since October 1, 2008, the Plan invested in the Lincoln Stable Value Fund (“Investment Contracts – LNL”), which has a credited interest rate that is based upon the three-year average of the Barclays rate plus 20 basis points and can be changed quarterly. For 2010, the average crediting rate was 3.92% (annualized), and for 2011 the average crediting rate was approximately 3.12%. Interest is credited at the same rate for the entire contract value. The guaranteed minimum interest rate (“GMIR”) is 3.00%. The guarantee is based on LNL’s ability to meet its financial obligations from the general assets of LNL.

For both the Investment Contract – LNL and the Guaranteed Account, restrictions apply to the aggregate movement of funds to other investment options. The fair value of the investment contracts approximate contract value. Participants are allocated interest on the investment contracts based on the average rate earned on all Plan investments in the investment contracts.

4. Investment Options

The detail of the net assets available for benefits by investment option as of December 31, 2011, was as follows:

			Investment Options
	Total			1.A		2.A		3.A		4.A		5.A
Assets
Investments:
Mutual funds	$	55,855,399	$	11,434,653	$	1,282,921	$	3,039,244	$	2,337,187	$	2,570,674
Collective investment trusts		39,320,637		-		-		-		-		-
Common stock - LNC		20,158,162		-		-		-		-		-
Investment contracts - LNL		37,076,901		-		-		-		-		-
Wilmington Trust money market fund		1,061,021		-		-		-		-		-
Brokerage account		2,342,040		-		-		-		-		-
Total investments		155,814,160		11,434,653		1,282,921		3,039,244		2,337,187		2,570,674

Notes receivable from participants		3,859,370		-		-		-		-		-
Accrued interest receivable		78,218		-		-		-		-		-
Contributions receivable from Sponsor company		361,358		27,618		1,751		14,150		9,299		7,972
Total assets		160,113,106		11,462,271		1,284,672		3,053,394		2,346,486		2,578,646

Liabilities
Due to (from) broker		234,146		9,325		1,119		8,728		8,822		2,768
Total liabilities		234,146		9,325		1,119		8,728		8,822		2,768
Net assets available for benefits	$	159,878,960	$	11,452,946	$	1,283,553	$	3,044,666	$	2,337,664	$	2,575,878
Number of participants selecting investment options				664		54		196		143		242

	Investment Options
		6.A		7.A		9.A		10.A		11.A		12.A
Assets
Investments:
Mutual funds	$	7,937,888	$	12,111,500	$	10,936,674	$	4,204,658	$	-	$	-
Collective investment trusts		-		-		-		-		7,653,885		695,026
Common stock - LNC		-		-		-		-		-		-
Investment contracts - LNL		-		-		-		-		-		-
Wilmington Trust money market fund		-		-		-		-		-		-
Brokerage account		-		-		-		-		-		-
Total investments		7,937,888		12,111,500		10,936,674		4,204,658		7,653,885		695,026

Notes receivable from participants		-		-		-		-		-		-
Accrued interest receivable		-		-		-		-		-		-
Contributions receivable from Sponsor company		30,427		39,938		29,138		11,194		22,535		3,268
Total assets		7,968,315		12,151,438		10,965,812		4,215,852		7,676,420		698,294

Liabilities
Due to (from) broker		14,783		16,690		12,342		4,568		9,313		829
Total liabilities		14,783		16,690		12,342		4,568		9,313		829
Net assets available for benefits	$	7,953,532	$	12,134,748	$	10,953,470	$	4,211,284	$	7,667,107	$	697,465
Number of participants selecting investment options		587		592		514		334		478		87

	Investment Options
		13.A		14.A		15.A		16.A		17.A		18.A
Assets
Investments:
Mutual funds	$	-	$	-	$	-	$	-	$	-	$	-
Collective investment trusts		8,254,999		10,073,642		5,713,461		6,929,624		-		-
Common stock - LNC		-		-		-		-		20,158,162		-
Investment contracts - LNL		-		-		-		-		-		37,076,901
Wilmington Trust money market fund		-		-		-		-		564,100		-
Brokerage account		-		-		-		-		-		-
Total investments		8,254,999		10,073,642		5,713,461		6,929,624		20,722,262		37,076,901

Notes receivable from participants		-		-		-		-		-		-
Accrued interest receivable		-		-		-		-		-		78,218
Contributions receivable from Sponsor company		18,316		20,231		15,363		21,906		46,068		42,184
Total assets		8,273,315		10,093,873		5,728,824		6,951,530		20,768,330		37,197,303

Liabilities
Due to (from) broker		6,839		6,019		8,489		17,337		-		105,706
Total liabilities		6,839		6,019		8,489		17,337		-		105,706
Net assets available for benefits	$	8,266,476	$	10,087,854	$	5,720,335	$	6,934,193	$	20,768,330	$	37,091,597
Number of participants selecting investment options		465		417		323		531		880		559

	Investment Options
		19.A		20.A		21.A	Loans		Short Term
Assets
Investments:
Mutual funds	$	-	$	-	$	-	$	-	$	-
Collective investment trusts		-		-		-		-		-
Common stock - LNC		-		-		-		-		-
Investment contracts - LNL		-		-		-		-		-
Wilmington Trust money market fund		-		-		-		-		496,921
Brokerage account		331,065		853,695		1,157,280		-		-
Total investments		331,065		853,695		1,157,280		-		496,921

Notes receivable from participants		-		-		-		3,859,370		-
Accrued interest receivable		-		-		-		-		-
Contributions receivable from Sponsor company		-		-		-		-		-
Total assets		331,065		853,695		1,157,280		3,859,370		496,921

Liabilities
Due to (from) broker		469		-		-		-		-
Total liabilities		469		-		-		-		-
Net assets available for benefits	$	330,596	$	853,695	$	1,157,280	$	3,859,370	$	496,921
Number of participants selecting investment options		3		8		11		299	NA

The detail of the net assets available for benefits by investment option as of December 31, 2010, was as follows:

			Investment Options
	Total			1.A		2A.		3.A		4.A		5.A
Assets
Investments:
Mutual funds	$	67,303,010	$	12,344,216	$	1,103,171	$	3,030,331	$	2,210,046	$	2,510,178
Collective investment trusts		30,839,384		-		-		-		-		-
Common stock - LNC		26,755,825		-		-		-		-		-
Investment contracts - LNL		36,183,046		-		-		-		-		-
Wilmington Trust money market fund		1,054,789		-		-		-		-		-
Brokerage account		2,176,011		-		-		-		-		-
Total investments		164,312,065		12,344,216		1,103,171		3,030,331		2,210,046		2,510,178

Notes receivable from participants		3,875,700		-		-		-		-		-
Accrued interest receivable		65,454		-		-		-		-		-
Contributions receivable from Sponsor company		205,463		15,860		896		6,070		4,361		3,656
Total assets		168,458,682		12,360,076		1,104,067		3,036,401		2,214,407		2,513,834

Liabilities
Due to (from) broker		238,401		8,059		1,090		6,727		4,705		1,944
Total liabilities		238,401		8,059		1,090		6,727		4,705		1,944
Net assets available for benefits	$	168,220,281	$	12,352,017	$	1,102,977	$	3,029,674	$	2,209,702	$	2,511,890
Number of participants selecting investment options				691		59		210		152		227

	Investment Options
		6.A		7.A		8.A		9.A		10.A		11.A
Assets
Investments:
Mutual funds	$	10,007,305	$	12,878,773	$	8,208,195	$	10,869,101	$	4,141,694	$	-
Collective investment trusts		-		-		-		-		-		7,187,192
Common stock - LNC		-		-		-		-		-		-
Investment contracts - LNL		-		-		-		-		-		-
Wilmington Trust money market fund		-		-		-		-		-		-
Brokerage account		-		-		-		-		-		-
Total investments		10,007,305		12,878,773		8,208,195		10,869,101		4,141,694		7,187,192

Notes receivable from participants		-		-		-		-		-		-
Accrued interest receivable		-		-		-		-		-		-
Contributions receivable from Sponsor company		17,604		25,190		16,566		16,050		5,674		13,065
Total assets		10,024,909		12,903,963		8,224,761		10,885,151		4,147,368		7,200,257

Liabilities
Due to (from) broker		13,284		17,901		13,271		11,432		4,665		8,653
Total liabilities		13,284		17,901		13,271		11,432		4,665		8,653
Net assets available for benefits	$	10,011,625	$	12,886,062	$	8,211,490	$	10,873,719	$	4,142,703	$	7,191,604
Number of participants selecting investment options		78		625		557		529		320		500

	Investment Options
		12.A		13.A		14.A		15.A		17.A		18.A
Assets
Investments:
Mutual funds	$	-	$	-	$	-	$	-	$	-	$	-
Collective investment trusts		618,303		7,776,125		9,953,487		5,304,277		-		-
Common stock - LNC		-		-		-		-		26,755,825		-
Investment contracts - LNL		-		-		-		-		-		36,183,046
Wilmington Trust money market fund		-		-		-		-		800,332		-
Brokerage account		-		-		-		-		-		-
Total investments		618,303		7,776,125		9,953,487		5,304,277		27,556,157		36,183,046

Notes receivable from participants		-		-		-		-		-		-
Accrued interest receivable		-		-		-		-		-		106,111
Contributions receivable from Sponsor company		1,403		9,462		12,925		8,626		25,880		22,175
Total assets		619,706		7,785,587		9,966,412		5,312,903		27,582,037		36,311,332

Liabilities
Due to (from) broker		3,794		6,558		10,056		8,241		-		118,021
Total liabilities		3,794		6,558		10,056		8,241		-		118,021
Net assets available for benefits	$	615,912	$	7,779,029	$	9,956,356	$	5,304,662	$	27,582,037	$	36,193,311
Number of participants selecting investment options		398		617		449		332		934		580

	Investment Options
		19.A			20.A		21.A	Loans		Short Term
Assets
Investments:
Mutual funds	$	-		$	-	$	-	$	-	$	-
Collective investment trusts		-			-		-		-		-
Common stock - LNC		-			-		-		-		-
Investment contracts - LNL		-			-		-		-		-
Wilmington Trust money market fund		-			-		-		-		254,457
Brokerage account		523,036			740,910		912,065		-		-
Total investments		523,036			740,910		912,065		-		254,457

Notes receivable from participants		-			-		-		3,875,700		-
Accrued interest receivable		(25,041	)		-		-		-		(15,616	)
Contributions receivable from Sponsor company		-			-		-		-		-
Total assets		497,995			740,910		912,065		3,875,700		238,841

Liabilities
Due to (from) broker		-			-		-		-		-
Total liabilities		-			-		-		-		-
Net assets available for benefits	$	497,995		$	740,910	$	912,065	$	3,875,700	$	238,841
Number of participants selecting investment options		4			6		7		291	NA

The detail of the changes in net assets available for benefits by investment option for the year ended December 31, 2011, was as follows:

				Investment Options
	Total				1.A			2.A			3.A			4.A			5.A
Investment income:
Cash dividends	$	1,627,967		$	517,441		$	63,465		$	72,054		$	101,058		$	10,506
Interest		1,322,907			-			-			-			-			-
Total investment income		2,950,874			517,441			63,465			72,054			101,058			10,506

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		2,493,610			427,925			21,582			95,937			36,324			67,693
Collective investment trusts		1,287,008			-			-			-			-			-
Common stock - LNC		890,394			-			-			-			-			-
Brokerage account		(48,343	)		-			-			-			-			-
Total net realized gain (loss)		4,622,669			427,925			21,582			95,937			36,324			67,693

Net change in unrealized appreciation
of investments		(15,163,969	)		(1,483,405	)		(62,395	)		(156,712	)		(173,553	)		(232,196	)

Contributions:
Participant		7,099,035			504,824			43,843			223,180			198,699			162,292
Sponsor company		2,117,518			160,322			10,163			82,140			53,980			46,277
Total contributions		9,216,553			665,146			54,006			305,320			252,679			208,569

Transfers from (to) affiliated plans		837,266			26,633			9,144			7,046			(4,229	)		6,402

Intra-Plan transfers		-			(298,974	)		156,498			(149,519	)		(48,043	)		157,968

Distributions to participants		(10,803,998	)		(753,837	)		(61,724	)		(159,134	)		(36,274	)		(154,954	)
Administrative expenses		(716	)		-			-			-			-			-
Total distributions and expenses		(10,804,714	)		(753,837	)		(61,724	)		(159,134	)		(36,274	)		(154,954	)

Net increase (decrease) in net assets
available for benefits		(8,341,321	)		(899,071	)		180,576			14,992			127,962			63,988
Net assets available for benefits at beginning-of-year		168,220,281			12,352,017			1,102,977			3,029,674			2,209,702			2,511,890
Net assets available for benefits at end-of-year	$	159,878,960		$	11,452,946		$	1,283,553		$	3,044,666		$	2,337,664		$	2,575,878

	Investment Options
		6.A			7.A			8.A			9.A			10.A			11.A
Investment income:
Cash dividends	$	202,630		$	130,745		$	-		$	221,507		$	48,295		$	-
Interest		-			-			-			-			-			-
Total investment income		202,630			130,745			-			221,507			48,295			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		148,156			298,921			1,115,090			159,761			122,221			-
Collective investment trusts		-			-			-			-			-			263,851
Common stock - LNC		-			-			-			-			-			-
Brokerage account		-			-			-			-			-			-
Total net realized gain (loss)		148,156			298,921			1,115,090			159,761			122,221			263,851

Net change in unrealized appreciation
of investments		(1,928,921	)		(1,039,770	)		(1,068,717	)		(158,629	)		(326,344	)		404,708

Contributions:
Participant		607,531			775,487			68,118			503,227			235,815			429,762
Sponsor company		176,626			231,839			14,891			169,144			64,979			130,817
Total contributions		784,157			1,007,326			83,009			672,371			300,794			560,579

Transfers from (to) affiliated plans		17,576			34,604			(16,566	)		12,588			15,485			14,790

Intra-Plan transfers		(503,079	)		(575,567	)		(8,318,855	)		(267,855	)		205,679			(127,763	)

Distributions to participants		(778,612	)		(607,573	)		(5,451	)		(559,992	)		(297,549	)		(640,662	)
Administrative expenses		-			-			-			-			-			-
Total distributions and expenses		(778,612	)		(607,573	)		(5,451	)		(559,992	)		(297,549	)		(640,662	)

Net increase (decrease) in net assets
available for benefits		(2,058,093	)		(751,314	)		(8,211,490	)		79,751			68,581			475,503
Net assets available for benefits at beginning-of-year		10,011,625			12,886,062			8,211,490			10,873,719			4,142,703			7,191,604
Net assets available for benefits at end-of-year	$	7,953,532		$	12,134,748		$	-		$	10,953,470		$	4,211,284		$	7,667,107

	Investment Options
		12.A			13.A	A		14.A			15.A			16.A			17.A
Investment income:
Cash dividends	$	-		$	-		$	-		$	-		$	-		$	193,260
Interest		-			-			-			-			-			-
Total investment income		-			-			-			-			-			193,260

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-			-			-			-			-
Collective investment trusts		14,240			427,869			451,232			192,801			(62,985	)		-
Common stock - LNC		-			-			-			-			-			890,394
Brokerage account		-			-			-			-			-			-
Total net realized gain (loss)		14,240			427,869			451,232			192,801			(62,985	)		890,394

Net change in unrealized appreciation
of investments		(133,097	)		177,585			212,308			248,479			(820,953	)		(8,362,186	)

Contributions:
Participant		60,484			344,775			411,447			261,588			444,248			794,047
Sponsor company		18,972			106,324			117,443			89,184			127,162			267,425
Total contributions		79,456			451,099			528,890			350,772			571,410			1,061,472

Transfers from (to) affiliated plans		(975	)		12,413			5,041			13,044			48,455			515,347

Intra-Plan transfers		151,678			(152,775	)		(481,247	)		17,644			7,602,774			743,531

Distributions to participants		(29,749	)		(428,744	)		(584,726	)		(407,067	)		(404,508	)		(1,855,525	)
Administrative expenses		-			-			-			-			-			-
Total distributions and expenses		(29,749	)		(428,744	)		(584,726	)		(407,067	)		(404,508	)		(1,855,525	)

Net increase (decrease) in net assets
available for benefits		81,553			487,447			131,498			415,673			6,934,193			(6,813,707	)
Net assets available for benefits at beginning-of-year		615,912			7,779,029			9,956,356			5,304,662			-			27,582,037
Net assets available for benefits at end-of-year	$	697,465		$	8,266,476		$	10,087,854		$	5,720,335		$	6,934,193		$	20,768,330

	Investment Options
		18.A			19.A			20.A		21.A		Loans			Short-term
Investment income:
Cash dividends	$	-		$	45,341		$	-	$	21,665		$	-		$	-
Interest		1,127,376			-			142		-			195,389			-
Total investment income		1,127,376			45,341			142		21,665			195,389			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-			-		-			-			-
Collective investment trusts		-			-			-		-			-			-
Common stock - LNC		-			-			-		-			-			-
Brokerage account		-			(32,903	)		-		(15,440	)		-			-
Total net realized gain (loss)		-			(32,903	)		-		(15,440	)		-			-

Net change in unrealized appreciation
of investments		-			(64,859	)		-		(195,312	)		-			-

Contributions:
Participant		780,783			887			2,288		3,102			-			242,608
Sponsor company		244,878			700			1,805		2,447			-			-
Total contributions		1,025,661			1,587			4,093		5,549			-			242,608

Transfers from (to) affiliated plans		(10,079	)		26,843			10,594		45,670			31,968			15,472

Intra-Plan transfers		1,550,942			(142,485	)		97,281		382,167			-			-

Distributions to participants		(2,795,614	)		(207	)		675		916			(243,687	)		-
Administrative expenses		-			(716	)		-		-			-			-
Total distributions and expenses		(2,795,614	)		(923	)		675		916			(243,687	)		-

Net increase (decrease) in net assets
available for benefits		898,286			(167,399	)		112,785		245,215			(16,330	)		258,080
Net assets available for benefits at beginning-of-year		36,193,311			497,995			740,910		912,065			3,875,700			238,841
Net assets available for benefits at end-of-year	$	37,091,597		$	330,596		$	853,695	$	1,157,280		$	3,859,370		$	496,921

The detail of the changes in net assets available for benefits by investment option for the year ended December 31, 2010, was as follows:

				Investment Options
	Total				1.A			2.A			3.A			4.A			5.A
Investment income:
Cash dividends	$	1,283,770		$	352,331		$	59,181		$	64,915		$	38,248		$	10,892
Interest		1,606,174			-			-			-			-			-
Total investment income		2,889,944			352,331			59,181			64,915			38,248			10,892

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		925,684			241,320			17,579			61,533			28,782			49,746
Collective investment trusts		1,116,307			-			-			-			-			-
Common stock - LNC		1,931,327			-			-			-			-			-
Brokerage account		100,546			-			-			-			-			-
Total net realized gain (loss)		4,073,864			241,320			17,579			61,533			28,782			49,746

Net change in unrealized appreciation
of investments		12,543,324			2,025,738			10,006			187,291			145,256			448,721

Contributions:
Participant		7,076,063			523,051			41,041			218,578			163,709			121,595
Sponsor company		2,007,331			154,699			8,998			59,088			43,276			35,960
Total contributions		9,083,394			677,750			50,039			277,666			206,985			157,555

Transfers from (to) affiliated plans		1,092,826			(19,633	)		333			6,687			10,716			4,701

Intra-Plan transfers		-			(484,576	)		274,612			(13,476	)		3,110			363,260

Distributions to participants		(15,772,704	)		(829,270	)		(26,531	)		(129,970	)		(94,210	)		(104,205	)
Administrative expenses		(2,394	)		-			-			-			-			-
Total distributions and expenses		(15,775,098	)		(829,270	)		(26,531	)		(129,970	)		(94,210	)		(104,205	)

Net increase (decrease) in net assets
available for benefits		13,908,254			1,963,660			385,219			454,646			338,887			930,670
Net assets available for benefits at beginning-of-year		154,312,027			10,388,357			717,758			2,575,028			1,870,815			1,581,220
Net assets available for benefits at end-of-year	$	168,220,281		$	12,352,017		$	1,102,977		$	3,029,674		$	2,209,702		$	2,511,890

	Investment Options
		6.A			7.A			8.A			9.A			10.A			11.A
Investment income:
Cash dividends	$	136,570		$	141,661		$	148,254		$	205,265		$	42,352		$	-
Interest		-			-			-			-			-			-
Total investment income		136,570			141,661			148,254			205,265			42,352			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		93,825			210,271			71,614			22,392			128,622			-
Collective investment trusts		-			-			-			-			-			97,559
Common stock - LNC		-			-			-			-			-			-
Brokerage account		-			-			-			-			-			-
Total net realized gain (loss)		93,825			210,271			71,614			22,392			128,622			97,559

Net change in unrealized appreciation
of investments		959,988			1,105,330			783,064			1,167,651			679,246			874,149

Contributions:
Participant		577,090			841,155			565,542			504,444			203,599			408,528
Sponsor company		174,244			246,376			160,081			155,682			55,415			126,142
Total contributions		751,334			1,087,531			725,623			660,126			259,014			534,670

Transfers from (to) affiliated plans		142,143			95,349			100,763			146,422			34,506			79,301

Intra-Plan transfers		(386,683	)		(596,041	)		(958,310	)		(420,248	)		(17,247	)		(194,449	)

Distributions to participants		(931,257	)		(720,497	)		(674,866	)		(842,451	)		(325,210	)		(555,186	)
Administrative expenses		-			-			(2,050	)		-			-			-
Total distributions and expenses		(931,257	)		(720,497	)		(676,916	)		(842,451	)		(325,210	)		(555,186	)

Net increase (decrease) in net assets
available for benefits		765,920			1,323,604			194,092			939,157			801,283			836,044
Net assets available for benefits at beginning-of-year		9,245,705			11,562,458			8,017,398			9,934,562			3,341,420			6,355,560
Net assets available for benefits at end-of-year	$	10,011,625		$	12,886,062		$	8,211,490		$	10,873,719		$	4,142,703		$	7,191,604

	Investment Options
		12.A			13.A			14.A			15.A			17.A			18.A
Investment income:
Cash dividends	$	-		$	-		$	-		$	-		$	41,448		$	-
Interest		-			-			-			-			-			1,368,954
Total investment income		-			-			-			-			41,448			1,368,954

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-			-			-			-			-
Collective investment trusts		25,971			209,584			621,690			161,503			-			-
Common stock - LNC		-			-			-			-			1,931,327			-
Brokerage account		-			-			-			-			-			-
Total net realized gain (loss)		25,971			209,584			621,690			161,503			1,931,327			-

Net change in unrealized appreciation
of investments		13,270			2,027,763			221,444			464,148			1,381,062			-

Contributions:
Participant		59,941			283,685			522,112			251,386			801,210			844,025
Sponsor company		14,548			92,952			127,652			83,444			250,047			218,659
Total contributions		74,489			376,637			649,764			334,830			1,051,257			1,062,684

Transfers from (to) affiliated plans		33,832			71,955			135,100			93,556			225,243			(59,611	)

Intra-Plan transfers		80,539			174,116			(896,955	)		(104,066	)		(2,875,632	)		4,203,093

Distributions to participants		(133,979	)		(752,008	)		(758,109	)		(535,226	)		(2,261,540	)		(6,048,374	)
Administrative expenses		-			-			-			-			-			-
Total distributions and expenses		(133,979	)		(752,008	)		(758,109	)		(535,226	)		(2,261,540	)		(6,048,374	)

Net increase (decrease) in net assets
available for benefits		94,122			2,108,047			(27,066	)		414,745			(506,835	)		526,746
Net assets available for benefits at beginning-of-year		521,790			5,670,982			9,983,422			4,889,917			28,088,872			35,666,565
Net assets available for benefits at end-of-year	$	615,912		$	7,779,029		$	9,956,356		$	5,304,662		$	27,582,037		$	36,193,311

	Investment Options
		19.A			20.A		21.A		Loans			Short-term
Investment income:
Cash dividends	$	29,917		$	-	$	12,736		$	-		$	-
Interest		-			18,221		-			218,999			-
Total investment income		29,917			18,221		12,736			218,999			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-		-			-			-
Collective investment trusts		-			-		-			-			-
Common stock - LNC		-			-		-			-			-
Brokerage account		36,645			-		63,901			-			-
Total net realized gain (loss)		36,645			-		63,901			-			-

Net change in unrealized appreciation
of investments		17,930			-		31,267			-			-

Contributions:
Participant		24,068			34,095		41,972			-			45,237
Sponsor company		16			23		29			-			-
Total contributions		24,084			34,118		42,001			-			45,237

Transfers from (to) affiliated plans		(54,738	)		59,021		(12,820	)		-			-

Intra-Plan transfers		444,423			629,550		774,980			-			-

Distributions to participants		78			-		-			(49,893	)		-
Administrative expenses		(344	)		-		-			-			-
Total distributions and expenses		(266	)		-		-			(49,893	)		-

Net increase (decrease) in net assets
available for benefits		497,995			740,910		912,065			169,106			45,237
Net assets available for benefits at beginning-of-year		-			-		-			3,706,594			193,604
Net assets available for benefits at end-of-year	$	497,995		$	740,910	$	912,065		$	3,875,700		$	238,841

				Investment Options
	Total				1.A			2.A			3.A			4.A			5.A
Investment income:
Cash dividends	$	1,033,993		$	20,690		$	20,778		$	61,177		$	41,484		$	11,823
Interest		1,728,784			-			-			-			-			-
Total investment income		2,762,777			20,690			20,778			61,177			41,484			11,823

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		(2,592,510	)		(490,033	)		39,682			56,628			(25,848	)		(96,507	)
Collective investment trusts		(597,295	)		-			-			-			-			-
Common stock - LNC		(5,869,682	)		-			-			-			-			-
Total net realized gain (loss)		(9,059,487	)		(490,033	)		39,682			56,628			(25,848	)		(96,507	)

Net change in unrealized appreciation
of investments		40,916,992			3,437,414			138,879			565,366			335,931			458,593

Contributions:
Participant		7,252,863			558,161			30,394			220,932			143,420			112,862
Sponsor company		1,735,437			128,695			6,219			59,703			29,751			27,585
Total contributions		8,988,300			686,856			36,613			280,635			173,171			140,447

Transfers from (to) affiliated plans		97,748			5,279			193			(2,419	)		76,852			3,217

Distributions to participants		(18,114,613	)		(680,357	)		(553,435	)		(745,880	)		(79,754	)		(177,806	)
Administrative expenses		(869	)		-			-			-			-			-
Intra-Plan transfers		-			(822,334	)		153,632			(93,952	)		(67,321	)		(169,079	)
Total distributions and expenses		(18,115,482	)		(1,502,691	)		(399,803	)		(839,832	)		(147,075	)		(346,885	)

Net increase (decrease) in net assets
available for benefits		25,590,848			2,157,515			(163,658	)		121,555			454,515			170,688
Net assets available for benefits at beginning-of-year		128,721,179			8,230,842			881,416			2,453,473			1,416,300			1,410,532
Net assets available for benefits at end-of-year	$	154,312,027		$	10,388,357		$	717,758		$	2,575,028		$	1,870,815		$	1,581,220

	Investment Options
		6.A			7.A			8.A			9.A			10.A			11.A
Investment income:
Cash dividends	$	124,050		$	121,842		$	74,820		$	239,152		$	38,965		$	-
Interest		-			-			-			-			-			-
Total investment income		124,050			121,842			74,820			239,152			38,965			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		(370,753	)		(453,803	)		(523,575	)		(671,376	)		(56,925	)		-
Collective investment trusts		-			-			-			-			-			(451,894	)
Common stock - LNC		-			-			-			-			-			-
Total net realized gain (loss)		(370,753	)		(453,803	)		(523,575	)		(671,376	)		(56,925	)		(451,894	)

Net change in unrealized appreciation
of investments		3,057,901			3,298,952			2,801,619			2,777,012			1,063,498			1,256,331

Contributions:
Participant		518,166			867,793			650,900			601,454			212,830			485,605
Sponsor company		124,566			220,199			109,772			150,965			44,466			122,384
Total contributions		642,732			1,087,992			760,672			752,419			257,296			607,989

Transfers from (to) affiliated plans		383			3,319			9,167			4,372			1,926			622

Distributions to participants		(846,857	)		(1,033,691	)		(1,047,051	)		(966,263	)		(221,157	)		(644,683	)
Administrative expenses		-			-			(869	)		-			-			-
Intra-Plan transfers		535,469			(238,947	)		(1,442,900	)		(2,157,357	)		2,498			(1,359,549	)
Total distributions and expenses		(311,388	)		(1,272,638	)		(2,490,820	)		(3,123,620	)		(218,659	)		(2,004,232	)

Net increase (decrease) in net assets
available for benefits		3,142,925			2,785,664			631,883			(22,041	)		1,086,101			(591,184	)
Net assets available for benefits at beginning-of-year		6,102,780			8,776,794			7,385,515			9,956,603			2,255,319			6,946,744
Net assets available for benefits at end-of-year	$	9,245,705		$	11,562,458		$	8,017,398		$	9,934,562		$	3,341,420		$	6,355,560

	Investment Options
		12.A			13.A			14.A			15.A			17.A			18.A
Investment income:
Cash dividends	$	-		$	-		$	-		$	-		$	279,212		$	-
Interest		-			-			-			-			-			1,490,438
Total investment income		-			-			-			-			279,212			1,490,438

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-			-			-			-			-
Collective investment trusts		8,400			(341,312	)		428,406			(240,895	)		-			-
Common stock - LNC		-			-			-			-			(5,869,682	)		-
Total net realized gain (loss)		8,400			(341,312	)		428,406			(240,895	)		(5,869,682	)		-

Net change in unrealized appreciation
of investments		72,449			2,275,560			1,547,204			1,697,907			16,132,376			-

Contributions:
Participant		22,949			289,011			409,938			270,082			941,727			916,639
Sponsor company		5,851			75,176			109,976			79,012			226,287			214,830
Total contributions		28,800			364,187			519,914			349,094			1,168,014			1,131,469

Transfers from (to) affiliated plans		94			(1,257	)		(14,455	)		(341	)		(158,029	)		168,825

Distributions to participants		(78,037	)		(516,979	)		(2,136,649	)		(264,789	)		(2,211,312	)		(5,543,115	)
Administrative expenses		-			-			-			-			-			-
Intra-Plan transfers		432,348			(309,297	)		1,407,084			(543,077	)		(3,969,860	)		8,642,642
Total distributions and expenses		354,311			(826,276	)		(729,565	)		(807,866	)		(6,181,172	)		3,099,527

Net increase (decrease) in net assets
available for benefits		464,054			1,470,902			1,751,504			997,899			5,370,719			5,890,259
Net assets available for benefits at beginning-of-year		57,736			4,200,080			8,231,918			3,892,018			22,718,153			29,776,306
Net assets available for benefits at end-of-year	$	521,790		$	5,670,982		$	9,983,422		$	4,889,917		$	28,088,872		$	35,666,565

	Investment Options
	Loans			Short-term
Investment income:
Cash dividends	$	-		$	-
Interest		238,346			-
Total investment income		238,346			-

Net realized gain (loss) on sale and
distribution of investments:
Mutual funds		-			-
Collective investment trusts		-			-
Common stock - LNC		-			-
Total net realized gain (loss)		-			-

Net change in unrealized appreciation
of investments		-			-

Contributions:
Participant		-			-
Sponsor company		-			-
Total contributions		-			-

Transfers from (to) affiliated plans		-			-

Distributions to participants		(104,089	)		(262,709	)
Administrative expenses		-			-
Intra-Plan transfers		-			-
Total distributions and expenses		(104,089	)		(262,709	)

Net increase (decrease) in net assets
available for benefits		134,257			(262,709	)
Net assets available for benefits at beginning-of-year		3,572,337			456,313
Net assets available for benefits at end-of-year	$	3,706,594		$	193,604

The following investment options were available beginning October 1, 2008, except for the brokerage account which was available beginning January 1, 2010, the MFS International Growth Fund which was available beginning January 26, 2011 and the Harbor International Growth Institution Fund which was removed effective January 26, 2011:

Option	Description of Investment Option
1.A	Columbia Acorn Z is a mutual fund that invests a majority of its net assets in small- and mid-sized companies with market capitalizations under $5 billion at the time of investment. The fund seeks long-term capital appreciation.
2.A	Delaware Foundation® Conservative Allocation Fund is a mutual fund that invests primarily in shares of other Delaware Investments Funds, including fixed income and equity funds. The portfolio seeks a combination of current income and preservation of capital with capital appreciation.
3.A	Delaware Foundation® Moderate Allocation Fund is a mutual fund that invests at least 25% of its net assets in equity funds and securities and at least 25% of its net assets in fixed income funds with the flexibility to invest more in equity funds and securities or more in fixed income funds and securities. It will also typically invest between 5% and 20% of its assets in international funds and securities. The portfolio seeks capital appreciation with current income as a secondary objective.
4.A	Delaware Foundation® Growth Allocation Fund is a mutual fund that invests primarily in shares of international mutual funds, including equity funds and to a lesser extent, fixed income funds. The fund seeks long-term capital growth.
5.A	Delaware Mid Cap Value I is a mutual fund that invests primarily in investments of medium-sized companies whose stock prices appear low relative to their underlying value or future potential. The fund seeks capital appreciation.
6.A	Dodge & Cox International Stock is a mutual fund that invests at least 80% of its total assets in common stocks, preferred stocks, securities convertible into common stocks and securities that carry the right to buy common stocks of non-United States companies excluding non-United States companies included in the Standard & Poor’s 500. The fund also invests in American, European and Global Depositary Receipts. The fund seeks long-term growth of principal and income.
7.A	American Fund Growth Fund R5 is a mutual fund that seeks long-term growth by investing primarily in common stocks of companies that appear to offer superior opportunities for growth of capital.
8.A	Harbor International Growth Institutional is a mutual fund that invests primarily in common stocks of foreign companies of any size throughout the world. The fund seeks long-term growth of capital.
9.A	Vanguard Institutional Index is a mutual fund that employs a “passive management” or indexing investment approach designed to track the performance of the Standard & Poor’s 500 Index, a widely recognized benchmark of U.S. stock market performance that is dominated by the stocks of large U.S. companies. The fund seeks to track the performance of a benchmark index that measures the investment return of large-capitalization stocks.
10.A	Vanguard Extended Market Index Institutional is a mutual fund that employs a “passive management” or indexing investment approach designed to track the performance of the Standard & Poor’s Completion Index. The fund seeks to track the performance of a benchmark index that measures the investment return of small- and mid-capitalization stocks.
11.A	Delaware Large Cap Value Trust is a collective investment trust fund that invests mainly in securities of large-capitalization companies. The fund seeks long term capital appreciation.
12.A	Delaware International Equity Trust is a collective investment trust fund that invests mainly in non-U.S. equity securities. The fund seeks long-term capital appreciation without undue risk to principal.
13.A	Delaware Small Cap Growth Trust is a collective investment trust fund that invests primarily in small companies. The fund seeks capital appreciation by investing primarily in securities of emerging or other growth-oriented companies.
14.A	Delaware Diversified Income Trust is a collective investment trust fund that allocates its investments principally among the U.S. Investment Grade, U.S. High Yield, International Developed Markets and Emerging Market Sectors. The fund seeks maximum long-term total return, consistent with reasonable risk.
15.A	Delaware Large Cap Growth Trust is a collective investment trust fund that invests mainly in individual large-cap companies. The fund seeks long-term capital appreciation by investing in equity securities of large capitalization companies that the advisors believe to have the potential for sustainable free cash flow growth.
16.A	MFS International Growth Fund is a collective investment trust that invests primarily in foreign equity securities, including emerging market equity securities. The fund seeks long-term capital appreciation without undue risk to principal.
17.A	LNC Stock Fund investment is a unitized stock fund that invests exclusively in shares of LNC Common Stock. However, some funds may be invested in the Wilmington Trust Short-Term Investment Account until the LNC stock can be purchased. This option is designed to provide participants with the opportunity to invest in LNC securities.

18.A	Lincoln Stable Value Account is a fixed annuity issued by LNL. The Lincoln Stable Value option is managed to earn a competitive interest rate without risk of loss of principal.
19.A	Through TD Ameritrade, a diverse group of mutual funds on the exchange markets are available to the participant to self-direct their account value into. Each mutual fund has its own specific investments strategy that is similar to the mutual funds’ strategies discussed above.
20.A 21.A	Through TD Ameritrade, a money market account is available to the participant to self-direct their account value into. The money market account earns a minimal return and provides liquidity, which allows the participant to efficiently respond to investment opportunities in the market. Through TD Ameritrade, a diverse group of common stocks on the exchange markets are available to the participant to self-direct their account value into. Each common stock provides the participant with a balanced level of risks and rewards.

5. Fair Value of Financial Investments, Carried at Fair Value

See Note 2 for discussions of the methodologies and assumptions used to determine the fair value of the Plan’s investments.

The Plan did not have any assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2011 or December 31, 2010, and the Plan noted no changes in valuation methodologies between these periods. In addition, there were no significant transfers between Level 1 or 2 for the year ended December 31, 2011. However, the Harbor International Growth Institution Fund (i.e. Level 1) option was removed effective January 26, 2011 and the MFS International Growth Fund (i.e. Level 2) was added beginning January 26, 2011.

The tables below are the Plan’s financial instruments carried at fair value on a recurring basis by the Fair Value Measurements and Disclosures Topic of the FASB ASC hierarchy levels described in Note 2.

	As of December 31, 2010
	Quoted Prices
	in Active		Significant		Significant
	Markets for		Observable		Unobservable
	Identical Assets		Inputs		Inputs		Total
	(Level 1)		(Level 2)		(Level 3)		Fair Value
Assets:
Mutual funds:
Conservative	$	28,458,182	$	-	$	-	$	28,458,182
Moderate		3,030,331		-		-		3,030,331
Growth		17,598,997		-		-		17,598,997
International		18,215,500		-		-		18,215,500
Collective investment trusts:
Delaware Large Cap Value Trust		-		7,187,192		-		7,187,192
Delaware International Equity Trust		-		618,303		-		618,303
Delaware Small Cap Growth Trust		-		7,776,125		-		7,776,125
Delaware Diversified Income Trust		-		9,953,487		-		9,953,487
Delaware Large Cap Growth Trust		-		5,304,277		-		5,304,277
Common stock - LNC		26,755,825		-		-		26,755,825
Investment contracts - LNL		-		-		36,183,046		36,183,046
Money market fund		-		1,054,789		-		1,054,789
Brokerage account		1,435,101		740,910		-		2,176,011
Total assets	$	95,493,936	$	32,635,083	$	36,183,046	$	164,312,065

	As of December 31, 2010
	Quoted Prices
	in Active		Significant		Significant
	Markets for		Observable		Unobservable
	Identical Assets		Inputs		Inputs		Total
	(Level 1)		(Level 2)		(Level 3)		Fair Value
Assets:
Mutual funds:
Conservative	$	28,458,182	$	-	$	-	$	28,458,182
Moderate		3,030,331		-		-		3,030,331
Growth		17,598,997		-		-		17,598,997
International		18,215,500		-		-		18,215,500
Collective investment trusts:
Delaware Large Cap Value Trust		-		7,187,192		-		7,187,192
Delaware International Equity Trust		-		618,303		-		618,303
Delaware Small Cap Growth Trust		-		7,776,125		-		7,776,125
Delaware Diversified Income Trust		-		9,953,487		-		9,953,487
Delaware Large Cap Growth Trust		-		5,304,277		-		5,304,277
Common stock - LNC		26,755,825		-		-		26,755,825
Investment contracts - LNL		-		-		36,183,046		36,183,046
Money market fund		-		1,054,789		-		1,054,789
Brokerage account		1,435,101		740,910		-		2,176,011
Total assets	$	95,493,936	$	32,635,083	$	36,183,046	$	164,312,065

The tables below set forth a summary of changes in the fair value of the Plan’s Level 3 investment assets:

For the Year Ended December 31, 2011

Items Included

Gains (Losses)

Purchases,

in Statement of

Issuances, Sales,

Changes in Net

Net Assets

Maturities,

Transfers In

Ending

Beginning

Assets Available

Available for

Settlements,

or Out of

Fair

Fair Value

for Benefits

Benefits

Calls, Net

Level 3, Net

Value

Investment contracts - LNL

36,183,046

893,855

37,076,901

For the Year Ended December 31, 2010

Items Included

Gains (Losses)

Purchases,

in Statement of

Issuances, Sales,

Changes in Net

Net Assets

Maturities,

Transfers In

Ending

Beginning

Assets Available

Available for

Settlements,

or Out of

Fair

Fair Value

for Benefits

Benefits

Calls, Net

Level 3, Net

Value

Investment contracts - LNL

35,474,845

708,201

36,183,046

For the Year Ended December 31, 2009

Items Included

Gains (Losses)

Purchases,

in Statement of

Issuances, Sales,

Changes in Net

Net Assets

Maturities,

Transfers In

Ending

Beginning

Assets Available

Available for

Settlements,

or Out of

Fair

Fair Value

for Benefits

Benefits

Calls, Net

Level 3, Net

Value

Investment contracts - LNL

29,623,868

5,850,977

35,474,845

The following provides the components of the items included in purchases, issuances, sales, maturities, settlements, calls, net, as reported above:

	For the Year Ended December 31, 2011
	Purchases		Issuances		Sales			Maturities		Settlements		Calls		Total

Investment contracts - LNL	$	11,427,438	$	-	$	(10,570,880	)	$	-	$	37,297	$	-	$	893,855

6. Income Tax Status

The Plan has received a determination letter from the Internal Revenue Service (“IRS”) dated April 30, 2004, stating that the Plan is qualified under section 401(a) of the Internal Revenue Code of 1986, as amended (“Code”) and, therefore, the related trust is exempt from taxation. Subsequent to this determination by the IRS, the Plan was amended and restated. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan’s administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan, as amended and restated, is qualified and the related trust is tax exempt. Federal (and most states) income tax is deferred on participants’

contributions, the Plan Sponsor’s contributions and income earned in the Plan until actual distribution or withdrawal from the Plan.

The Plan Administrator has concluded that as of December 31, 2011, there are no uncertain tax positions taken or expected to be taken. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to the applicable statute of limitations.

7. Related Party Transactions

The Plan has investments in common stock of LNC and investment contracts with LNL. Starting October 1, 2008, the Plan invests in mutual funds and collective investment trusts managed by Delaware Management Holdings, Inc. (“Delaware”). Delaware was an affiliate of LNL through January 4, 2010, when it was sold to an unrelated third party. Lincoln Alliance, an affiliate of LNL, is the recordkeeper for the Plan. Beginning October 1, 2008, all administrative expenses were paid by LNC.

8. Concentrations of Credit Risks

As of December 31, 2011, the Plan had investments in common stock of LNC and investments contracts with LNL of $20,158,162 (13% of net assets) and $37,076,901 (23% of net assets), respectively. As of December 31, 2010, the Plan had investments in common stock of LNC and investment contracts with LNL of $26,755,825 (16% of net assets) and $36,183,046 (22% of net assets), respectively. LNC and LNL operate predominately in the insurance and investment management industries.

The Plan invests in various investment securities. Investment securities are exposed to various risks including, but not limited to, interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investments will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in these financial statements.

9. Reconciliation to Form 5500

The following is a reconciliation of net assets available for benefits per the statement of net assets available for benefits to the Form 5500:

	As of December 31,
	2011			2010
Net assets available for benefits per the financial statements	$	159,878,960		$	168,220,281
Amounts allocated to withdrawn participants		(706,137	)		(440,673	)
Difference in realized gain (loss) basis at end-of-year		(1,326,817	)		-
Net assets available for benefits per the Form 5500	$	157,846,006		$	167,779,608

The following is a reconciliation of distributions to participants per the statement of changes in net assets available for benefits to the Form 5500:

	For the Years Ended December 31,
	2011			2010			2009
Distributions to participants per the financial statements	$	10,803,998		$	15,772,704		$	18,114,613
Amounts allocated to withdrawn participants at end-of-year		706,137			440,673			4,891
Amounts allocated to withdrawn participants at end-of-prior-year		(440,673	)		(4,891	)		(506,313	)
Distributions to participants per the Form 5500	$	11,069,462		$	16,208,486		$	17,613,191

Amounts allocated to participants are recorded on the Form 5500 for benefit payments that have been processed and approved for payment prior to year-end but not yet paid; however, the financial statements do not reduce assets until paid.

The following is a reconciliation of the reported net appreciation (depreciation) of Common Stock – LNC per the financial statements to the Form 5500:

	For the Years Ended December 31,
	2011			2010		2009
Common Stock - LNC net realized and unrealized
appreciation (depreciation) per the financial statements	$	(7,471,792	)	$	3,312,389	$	10,262,695
Common Stock - LNC net realized and unrealized
appreciation (depreciation) per the Form 5500		(8,798,609	)		2,656,359		10,300,705
Difference in realized gain (loss) basis	$	(1,326,817	)	$	656,030	$	(38,010	)

The Form 5500 reports the realized gains and losses on common stock as the difference between the proceeds of assets sold during the year and the fair value of those assets at the beginning of the year; however, the financial statements report the realized gains and losses on common stock as the difference between historical cost and fair value.

Supplemental Schedule

LNL Agents’ 401(k) Savings Plan

Plan Number: 006

EIN: 35-0472300

Schedule H, Line 4i – Schedule of Assets (Held At End of Year)

As of December 31, 2011

(a)	(b)	(c)		(d)		(e)
	Identity of Issue,	Description of Investment,
	Borrower,	including Maturity Date,
	Lessor or	Rate of Interest,				Current
	Similar Party	Par or Maturity Value		Cost		Value

	Mutual funds:
	Columbia Acorn Z	414,900.327	participation units	**	$	11,434,653
	Delaware Foundation® Conservative Allocation Fund	133,776.955	participation units	**		1,282,921
	Delaware Foundation® Moderate Allocation Fund	285,643.233	participation units	**		3,039,244
	Delaware Foundation® Growth Allocation Fund	251,310.430	participation units	**		2,337,187
	Delaware Mid Cap Value I	293,455.936	participation units	**		2,570,674
	Dodge & Cox International Stock	271,473.598	participation units	**		7,937,888
	American Fund Growth Fund of America R-5	422,297.768	participation units	**		12,111,500
	Vanguard Institutional Index	95,068.446	participation units	**		10,936,674
	Vanguard Extended Market Index Institutional	106,879.969	participation units	**		4,204,658
	Total mutual funds					55,855,399

	Collective investment trusts:
	Delaware Large Cap Value Trust	582,931.074	participation units	**		7,653,885
	Delaware International Equity Trust	101,463.650	participation units	**		695,026
	Delaware Small Cap Growth Trust	526,466.773	participation units	**		8,254,999
	Delaware Diversified Income Trust	672,024.149	participation units	**		10,073,642
	Delaware Large Cap Growth Trust	414,319.144	participation units	**		5,713,461
	MFS International Growth Fund	75,183.075	participation units	**		6,929,624
	Total collective investment trusts					39,320,637

*	Common stock - LNC	1,038,010.402	shares	**		20,158,162

*	Investment contracts - LNL	37,076,901	3.12% interest rate (annualized)	**		37,076,901

	Wilmington Trust Money Market Fund W Class	1,061,021	par value	**		1,061,021

	Brokerage account	2,342,040	par value	**		2,342,040

*	Notes receivable from participants	3,859,370	Various loans at interest rates
			varying from 4.25% to 10.50%
			Maturity through March 2029	-		3,859,370
					$	159,673,530

*	Indicates a related party to the Plan.

**	Indicates a participant-directed account. The cost disclosure is not required.

SIGNATURE

THE PLAN: Pursuant to the requirements of the Securities and Exchange Act of 1934, the Administrator of The Lincoln National Life Insurance Company Agents’ Savings and Profit-Sharing Plan has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.

	LNL Agents’ 401(k) Savings Plan


	By: /s/ George A. Murphy
Date: March 30, 2012	George A. Murphy on behalf of The Lincoln National
	Corporation Benefits Committee