Here is what the agent responded with after I inquired:

"lease find to follow the information regarding the reason(s) that a participant can take a Hardship distribution request.

HARDSHIP DISTRIBUTIONS EXPLANATION

A full withdrawal can only be completed by a participant at age 59 ½ or any terminated employees. And then a Hardship distribution is used if the participant has encountered financial hardship and has exhausted all other options. The purposes which are considered Hardship are the following;

1. Foreclosure on principle residence

2. Purchase of principle residence

3. Funeral expense

4. College expense

5. Medical expense

6. Certain expenses for repair of damage to employee’s principle residence

The penalty for this type of distribution is 10% for early withdrawal. Lincoln will automatically withhold this amount and then send a 1099-R tax form to the participant at the end of the year. The penalty and tax amount will then be part of the participants personal tax return and may result in additional tax liability.

In order to receive this type of distribution the participant must provide documentation to support one of these purpose. It is also important to note that the employee/participant must refrain from 401k deferrals for six (6) months after a hardship distribution.

I know this is a lot of information to absorb so feel free to call if you have any further questions."