Exhibit 10.1

 

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May 2, 2016

John Gallina

15566 Hidden Oaks Lane

Carmel, IN 46033-8160

Dear John:

I am pleased to confirm our offer of the position of Executive Vice President
and Chief Financial Officer, reporting to me, effective June 1, 2016. In
recognition of your expertise and potential contributions, your compensation and
benefits have been structured as follows:

 

  •   Base annual salary of $750,000, effective on May 30, 2016

 

  •   Annual Incentive Plan opportunity target of 100% of your eligible
earnings, pro-rated based on your effective date in this position.

 

  •   Directed Executive Compensation Plan (DEC) providing $30,000 in Cash
Credits. Your benefit increase to $2,500 per month begins in June.

 

  •   You will receive a promotional stock grant with a value of approximately
$1,000,000 on June 1, 2016. This grant will include restricted stock units
(RSUs), performance stock units (PSUs), and stock options.

 

  •   Approximately $250,000 of this value will be in the form of RSUs. Each RSU
represents one share of Anthem Common Stock. For example, if the stock price was
$140.00 on the date of grant, the value of one RSU share would be $140.00. The
number of RSUs will be set on the date of grant based on the following
formula: # of RSUs = $250,000 / ANTM Stock Price, with the number of shares
rounded to the nearest share.

 

  •   You will receive these shares less shares withheld to pay income taxes in
three installments commencing on the first anniversary of the grant date,
assuming your continued service.

 

  •   Approximately $500,000 of this value will be in the form of PSUs. Each PSU
represents one share of Anthem Common Stock. For example, if the stock price was
$140.00 on the date of grant, the value of one PSU share would be $140.00. The
number of PSUs will be set on the date of grant based on the following
formula: # of PSUs = $500,000 / ANTM Stock Price.

 

  •   The number of PSUs will be adjusted after the end of the three-year
performance period based on how well Anthem performs versus selected performance
measures. The adjusted number of PSUs will be from 0 – 200% of the target number
you were originally granted.

 

  •   You will receive these shares less shares withheld to pay income taxes at
the end of the three-year performance period, assuming your continued service.

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  •   Approximately $250,000 of this value will be in the form of stock options.
A stock option provides you with the right to purchase shares of Anthem stock at
the market price on the date of the grant during the ten year exercise term. The
value you actually realize from an option will be based on Anthem’s stock price
appreciation between the date the options are granted to you and the date that
you purchase the shares, and will be subject to income taxes on the purchase
date.

 

  •   The cost of granting a stock option is approximately 23.4% of the stock
price. For example, if the stock price was $140.00 on the date of grant, the
value of one option share would be $140.00 x 23.4% = $32.76. The number of
shares will be set on the date of grant based on the following formula: # of
shares = $250,000 / (ANTM Stock Price x approximately 23.4%), with the number of
shares rounded to the nearest share.

 

  •   These stock options have an exercise term of 10 years from the date of
grant (assuming continued service) and vest in six semiannual installments over
the first three years.

 

  •   Long Term Stock Incentive (LTSI) – You will be eligible to be considered
for stock option/restricted stock grants commensurate with your position. The
promotional grant above is based on a seven month proration of the difference in
the 2016 target for the CFO role of $2,500,000 and the annual grant you received
in March.

 

  •   Executive Agreement Plan – you will continue to participate in the Anthem,
Inc. Executive Agreement Plan at the Executive Vice President level, which
provides for severance benefits consisting of two years of salary and target
bonus plus outplacement services and continued health and DEC benefits while
receiving severance. The severance benefit increases to three years during the
Cigna Integration Period (as defined in the Plan).

 

  •   Stock Ownership Guidelines- You will be responsible for maintaining
beneficial ownership of Anthem stock equal to three times your base pay. You
will have two years from the date of your promotion to reach this ownership
level.

 

  •   You will remain eligible for the Total Rewards programs you currently
enjoy as an executive of Anthem.

Congratulations on your new role!

Sincerely,

/s/ Joseph R. Swedish

Joseph R Swedish

Chairman, President & Chief Executive Officer