<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: May 17, 1995
Date of earliest
event reported: May 16, 1995
LINCOLN NATIONAL CORPORATION
------------------------------------------------------
(exact name of registrant as specified in its charter)
Indiana 1-6028 35-1140070
- -------------- ------------------------ -------------------
(State of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
200 East Berry Street, Fort Wayne, Indiana 46802-2706
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
219-455-2000
-------------------------------
(Registrant's telephone number)
Page 1 of 15
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2
ITEM 5. OTHER EVENTS
This Calculation of Ratio of Earnings to Fixed Charges (Schedule I),
form of Pricing Agreement (Schedule II) and form of Debenture (Schedule
III) are being filed in connection with the Company's Registration
Statement on Form S-3, File No. 33-55379, and its proposed issuance of $200
million principal amount of 7 1/4% Debentures due May 15, 2005 (the
"Debentures").
The initial set of pro forma ratios in Schedule I are after giving
effect to the net increase in interest expense due to the issuance of the
Debentures at a maximum assumed rate of 7 1/2%, less the repayment of
$200.0 million of short-term debt at a weighted average interest rate of
6.0%. The second set of pro forma ratios in Schedule I are after assuming
a decrease of 1/8 of 1% from the maximum assumed interest rate of 7 1/2%.
The form of the Underwriting Agreement incorporated by reference into
the Pricing Agreement filed as Schedule II was previously filed with the
Commission under cover of a Form 8-K on September 29, 1994.
<PAGE>
3
SCHEDULE I-CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES - HISTORICAL BASIS
($'S IN MILLIONS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED
MARCH 31, MARCH 31, DECEMBER 31,
1995 1994 1994
--------- --------- ------------
<S> <C> <C> <C>
EARNINGS:
Income before federal
income tax ----------------------- $179.4 $182.3 $ 376.3
Undistributed earnings
of unconsolidated
affiliates ----------------------- (5.1) (0.7) (14.6)
Fixed charges, excluding
interest on annuities
and financial products ----------- 18.5 15.6 66.6
------ ------ --------
Earnings, excluding interest
on annuities and
financial products ------------- 192.8 197.2 428.3
Interest on annuities and
financial products --------------- 335.3 305.3 1,260.9
------ ------ --------
Earnings ------------------------ $528.1 $502.5 $1,689.2
FIXED CHARGES:
Interest expense on debt----------- $ 14.0 $ 11.3 $ 49.5
Interest component of
rent expense --------------------- 4.5 4.3 17.1
------ ------ --------
Fixed charges, excluding
interest on annuities
and financial products --------- 18.5 15.6 66.6
Interest on annuities and
financial products --------------- 335.3 305.3 1,260.9
------ ------ --------
Fixed charges ------------------- 353.8 320.9 1,327.5
Pre-tax earnings to cover
preferred stock dividends -------- 5.7 5.2 18.5
------ ------ --------
Combined fixed charges and
preferred stock
dividends ---------------------- $359.5 $326.1 $1,346.0
RATIOS OF EARNINGS TO FIXED:
Excluding interest on
annuities and financial
products (1) --------------------- 10.44 12.67 6.43
Including interest on
annuities and financial
products (2) --------------------- 1.49 1.57 1.27
Ratio of earnings to
combined fixed charges
and preferred stock
dividends (3) -------------------- 1.47 1.54 1.25
</TABLE>
(1) This ratio is comprised of the relationship of "earnings excluding interest
on annuities and financial products" to "fixed charges excluding interest
on annuities and financial products" as disclosed above.
<PAGE>
4
(2) This ratio is comprised of the relationship of "earnings" to "fixed
charges" as disclosed above.
(3) This ratio is comprised of the relationship of "earnings" to "combined
fixed charges and preferred stock dividends" as disclosed above.
<PAGE>
5
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES - PRO FORMA BASIS
($'S IN MILLIONS)
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
MARCH 31, DECEMBER 31, MARCH 31, DECEMBER 31,
1995 1994 1995 1994
------------ ------------ ------------ ------------
[7 1/2% LT, 6.0% ST] [7 3/8% LT, 6.0% ST]
<S> <C> <C> <C> <C>
EARNINGS:
Income before federal
income tax ----------------- $178.7 $ 373.3 $178.8 $ 373.6
Undistributed earnings
of unconsolidated
affiliates ----------------- (5.1) (14.6) (5.1) (14.6)
Fixed charges, excluding
interest on annuities
and financial products ----- 19.2 69.6 19.1 69.3
------ -------- ------ --------
Earnings, excluding
interest
on annuities and
financial products ------- 192.8 428.3 192.8 428.3
Interest on annuities and
financial products --------- 335.3 1,260.9 335.3 1,260.9
------ -------- ------ --------
Earnings ------------------ $528.1 $1,689.2 $528.1 $1,689.2
FIXED CHARGES:
Interest expense on debt----- $ 14.7 $ 52.5 $ 14.6 $ 52.2
Interest component of
rent expense --------------- 4.5 17.1 4.5 17.1
------ -------- ------ --------
Fixed charges, excluding
interest on annuities
and financial products --- 19.2 69.6 19.1 69.3
Interest on annuities and
financial products --------- 335.3 1,260.9 335.3 1,260.9
------ -------- ------ --------
Fixed charges ------------- 354.5 1,330.5 354.4 1,330.2
Pre-tax earnings to cover
preferred stock dividends -- 5.7 18.5 5.7 18.5
------ -------- ------ --------
Combined fixed charges and
preferred stock
dividends ---------------- $360.2 $1,349.0 $360.1 $1,348.7
RATIOS OF EARNINGS TO FIXED:
Excluding interest on
annuities and financial
products (1) --------------- 10.03 6.15 10.06 6.17
Including interest on
annuities and financial
products (2) --------------- 1.49 1.27 1.49 1.27
Ratio of earnings to
combined fixed charges
and preferred stock
dividends (3) -------------- 1.47 1.25 1.47 1.25
</TABLE>
(1) This ratio is comprised of the relationship of "earnings excluding interest
on annuities and financial products" to "fixed charges excluding interest on
annuities and financial products" as disclosed above.
<PAGE>
6
(2) This ratio is comprised of the relationship of "earnings" to "fixed
charges" as disclosed above.
(3) This ratio is comprised of the relationship of "earnings" to "combined
fixed charges and preferred stock dividends" as disclosed above.
<PAGE>
7
SCHEDULE II-FORM OF PRICING AGREEMENT
Pricing Agreement
-----------------
May 16, 1995
Ladies and Gentlemen:
Lincoln National Corporation, an Indiana corporation (the "Company"),
proposes, subject to the terms and conditions stated herein (this "Agreement")
and in the Underwriting Agreement, dated September 29, 1994 (the "Underwriting
Agreement") executed by the Company, to issue and sell to the Underwriters named
in Schedule I hereto (the '"Underwriters") the Securities specified in Schedule
II hereto (the "Designated Securities"). Each of the provisions of the
Underwriting Agreement is incorporated herein by reference in its entirety, and
shall be deemed to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein; and each of the representations
and warranties set forth therein shall be deemed to have been made at and as of
the date of this Agreement, except that each representation and warranty which
refers to the Final Prospectus in Section 1 of the Underwriting Agreement shall
be deemed to be a representation or warranty as of the date of the Underwriting
Agreement in relation to the Final Prospectus (as therein defined), and also a
representation and warranty as of the date of this Agreement in relation to the
Final Prospectus as amended or supplemented relating to the Designated
Securities which are the subject of this Agreement. Each reference to the
Representatives herein and in the provisions of the Underwriting Agreement so
incorporated by reference shall be deemed to refer to you. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are used herein as
therein defined. The Representatives designated to act on behalf of the
Representatives and on behalf of each of the Underwriters of the Designated
Securities pursuant to the Underwriting Agreement and the address of the
Representatives are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the Basic
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount or the number of shares, as the case may be, of Designated
Securities set forth opposite the name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, constitute a binding agreement between each of the Underwriters and
the Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is or will be pursuant to the authority set forth in a
form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination upon request, but without warranty on the part of
the Representatives as to the authority of the signers hereof.
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8
Very truly yours,
LINCOLN NATIONAL CORPORATION
By:
--------------------------------
Title:
-----------------------------
Accepted as of the date hereof:
Lehman Brothers Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
By: Lehman Brothers Inc.
On behalf of each of the Underwriters
By:
--------------------------------
Title:
----------------------------------
<PAGE>
9
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount
or Number of Shares
of Securities to
Underwriters Be Purchased
- ------------ -------------------
<S> <C>
Lehman Brothers Inc..................... $67,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated...................... $66,500,000
Morgan Stanley & Co. Incorporated....... $66,500,000
------------
Total......................... $200,000,000
============
</TABLE>
<PAGE>
10
SCHEDULE II
Underwriting Agreement dated September 29, 1994
Registration Statement No. 33-55379
Underwriters:
Lehman Brothers Inc.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Morgan Stanley & Co. Incorporated
Title, Purchase Price and Description of Securities:
Title: 7 1/4% Debentures due 2005
Aggregate principal amount: $200,000,000
Number of Shares: Not applicable
Price to the public: 99.486%
Purchase price (include accrued interest or amortization, if any): 98.836%
Underwriting Discount: .65%
Sinking fund provisions: None
Redemption provisions: The Debentures are not redeemable prior to
maturity.
Other provisions: None
Maturity: May 15, 2005
Interest Rate: 7 1/4%, payable from May 23, 1995
Interest Payment Dates: May 15 and November 15, commencing November 15,
1995
Record Dates: Next preceding April 30 for May 15 Interest Payment Date and
October 31 for November 15 Interest Payment Date
Closing Date, Time and Location: May 23, 1995, 9:00 a.m., Sullivan & Cromwell,
125 Broad Street, New York, New York 10004
Delayed Delivery Arrangements: None
Modification of items to be covered by the letter from Ernst & Young LLP
delivered pursuant to
Section 5(g) at the time this Agreement is executed: None
Address of Representatives for purposes of this Agreement:
Lehman Brothers Inc.
3 World Financial Center
16th Floor
New York, New York 10285
<PAGE>
11
SCHEDULE III-FORM OF DEBENTURE
LINCOLN NATIONAL CORPORATION
7 1/4% Debenture due May 15, 2005
[Registered] CUSIP
No. R- U.S.$
Unless this Debenture is presented by an authorized
representative of The Depository Trust Company, a New
York corporation ("DTC"), to the Company (as defined
below) or its agent for registration of transfer,
exchange, or payment, and any Debenture issued is
registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof,
Cede & Co., has an interest herein.
Lincoln National Corporation, a corporation organized and existing under
the laws of the State of Indiana (hereinafter called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to Cede & Co. or registered assigns,
the principal sum of ______________________________ Dollars
($___________________) on May 15, 2005 and to pay interest thereon from May 23,
1995 or from the most recent interest payment date to which interest has been
paid or duly provided for, semi-annually on May 15 and November 15, in each
year, commencing on November 15, 1995, at the rate of 7 1/4% per annum until the
principal hereof is paid or such payment is duly provided for. The interest so
payable and punctually paid or duly provided for on any interest payment date
will be paid to the person in whose name this Debenture (or one or more
predecessor Debentures) is registered at the close of business on the next
preceding April 30 and October 31, respectively (each respectively a "Record
Date"), subject to certain exceptions as provided in the Indenture. Payment of
the principal of, and interest on, this Debenture will be made at the designated
office or agency of the Company maintained for such purpose in The City of New
York, New York in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debt or,
at the option of the Company, interest so payable may be paid by check to the
order of said Holder mailed to his address appearing on the Security Register.
Any interest not so punctually paid or duly provided for shall be payable as
provided in the Indenture. Interest on this Debenture will be computed on the
basis of a 360-day year of twelve 30-day months.
Reference is hereby made to the further provisions of this Debenture set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Debenture shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, Lincoln National Corporation has caused this instrument
to be duly executed under its corporate seal.
LINCOLN NATIONAL CORPORATION
By______________________________
Title:
<PAGE>
12
Attest:
- --------------------------
Secretary
Dated:
Trustee's Certificate of Authentication
This is one of the Securities of the series designated herein and referred
to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as
Trustee
By
-------------------------------
Authorized Signatory
<PAGE>
13
[Reverse of Debenture]
This Debenture is one of a duly authorized issue of Securities of the
Company of a series hereinafter specified, all issued and to be issued under an
Indenture dated as of September 15, 1994 (herein called the "Indenture"),
between the Company and The Bank of New York, as Trustee (herein called the
"Trustee", which term includes any successor Trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holder of the
Securities and the terms upon which the Securities are, and are to be,
authenticated and delivered. The Securities may be issued in one or more
series, the terms of which different series may vary as provided in the
Indenture. This Debenture is one of a series of the Securities of the Company
designated as its 7 1/4% Debentures due May 15, 2005 (herein called the
"Debentures"), limited in aggregate principal amount to $200,000,000, except as
otherwise provided in the Indenture.
The Debentures are not redeemable prior to maturity and are not
entitled to any sinking fund. If an Event of Default shall occur with respect
to the Debentures, the principal of the Debentures may be declared due and
payable in the manner and with the effect provided in the Indenture.
The Indenture contains provisions for defeasance at any time of the
Debentures, upon which the Company, at its option, shall be deemed to have been
Discharged from its obligations with respect to the Debentures or shall cease to
be under any obligation to comply with certain restrictive covenants of the
Indenture.
Subject to certain exceptions, the Indenture or the Debentures may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Outstanding Securities affected by such amendment or
supplement voting as one class. Without the consent of any Holder, the Company
and the Trustee may amend or supplement the Indenture or the Debentures to,
among other things, cure any ambiguity, defect or inconsistency. Subject to
certain exceptions, any past default or Event of Default may be waived by the
Holders of at least a majority in principal amount of the Outstanding Securities
of any series affected on behalf of the Holders of the Securities of that series
or the Holders of at least a majority in principal amount of all the Outstanding
Securities voting as one class. Any such consent or waiver by the Holder of
this Debenture shall be conclusive and binding upon such Holder and upon all
future Holders of this Debenture and of any Debenture issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent or waiver is made upon this Debenture or upon any Debenture issued upon
the transfer hereof or in exchange herefor or in lieu hereof.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, and
interest on, this Debenture at the times, place, and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable on the Security Register of
the Company, upon surrender of this Debenture for transfer at the office or
agency of the Company in The City of New York, New York, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Registrar, duly executed by the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Debentures, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Debentures are issuable in registered form without coupons in
denominations of $1,000 and integral multiples thereof. As provided in the
Indenture and subject to certain limitations therein set forth, this Debenture
<PAGE>
14
is exchangeable for a like aggregate principal amount of Debentures of different
authorized denominations as requested by the Holder surrendering the same.
No service charge will be made for any such transfer or exchange, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the person in whose name this Debenture is registered as the owner
hereof for the purpose of receiving payment as herein provided and for all other
purposes whether or not this Debenture be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture or for any claim based hereon or otherwise in any
manner in respect hereof, or in respect of the Indenture, against any
incorporator, shareholder, officer or director, as such, past, present or
future, of the Company or of any predecessor or successor corporation, whether
by virtue of any constitutional provision or statute or rule of law, or by the
enforcement of any assessment or penalty or in any other manner, all such
liability being expressly waived and released by the acceptance hereof and as
part of the consideration for the issue hereof.
All capitalized terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
<PAGE>
15
SIGNATURE PAGE
LINCOLN NATIONAL CORPORATION
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Lincoln National Corporation
By
----------------------------
Richard C. Vaughan
Executive Vice President and
Chief Financial Officer
By /s/ Donald L. Van Wyngarden
----------------------------
Donald L. Van Wyngarden
Second Vice President and
Controller
Date May 16, 1995
---------------
