Exhibit 10.10

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”), is by and between Anthem, Inc., an
Indiana corporation (the “Company”), with offices located at 120 Monument
Circle, Indianapolis, Indiana, and Randall Lewis (the “Executive”), residing at
3707 North Gate Woods Court, Walnut Creek, CA 94598, dated as of the 14th day of
July, 2003.

 

W I T N E S S E T H:

 

WHEREAS, the Company (which hereinafter also includes subsidiaries of the
Company) desires to assure itself of the services of the Executive for the
period provided in this Agreement, and the Executive is willing to serve in the
employ of the Company on a full-time basis for such period, all in accordance
with the terms and conditions contained in this Agreement;

 

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
Company and the Executive hereby agree as follows:

 

1. Condition of Employment. The Company hereby employs the Executive and the
Executive hereby accepts such employment for the period provided for in Section
2, all upon the terms and conditions contained in this Agreement. As a condition
to the Executive’s employment, the Executive affirms and represents that the
Executive is under no obligation to any former employer or other person which is
in any way inconsistent with, or which imposes any restriction upon, the
employment of the Executive by the Company or the Executive’s undertakings under
this Agreement.

 

2. Term of Employment. Unless sooner terminated pursuant to Section 7, the term
of the Executive’s employment under this Agreement shall be for a period
commencing on the date hereof through the 31 day of December, 2005 (“Term”). On
or before December 31, 2005, the Company will offer to the Executive a new
executive level position with the following terms:

 

(a) the position will be based in the Indianapolis metropolitan area; and

 

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(b) the position will be one of the following: (i) Chief Financial Officer of
the Company, (ii) the executive leader of an operational division of the Company
having a minimum of five hundred million dollars ($500,000,000) in annual
revenue, or (iii) another executive position having a base salary of at least
three hundred fifty thousand dollars ($350,000).

 

In the event the Company fails to make any of the foregoing opportunities
available to the Executive, the Executive may terminate this Agreement in
accordance with the terms of Section 11.

 

3. Duties. During the Term, the Executive shall provide executive,
administrative and managerial services to the Company and perform such other
reasonable employment duties as the Chief Executive Officer of the Company may
from time to time prescribe. The Executive shall also serve as a director of any
of the Company’s subsidiaries to which he is elected.

 

The Executive shall, except to the extent approved by the Chief Executive
Officer, (i) devote his full-time to the services required of the Executive,
(ii) render his services exclusively to the Company and (iii) use his best
efforts, judgment, and energy to improve and advance the business and interests
of the Company in a manner consistent with the duties of the Executive’s
position. The Executive may serve on boards of directors or advisory boards of
businesses that are not competitors of the Company or which do not create a
conflict of interest or on the boards of civic and not for profit organizations.
The Executive has disclosed in writing such memberships to the Chief Executive
Officer prior to the execution of this Agreement and shall disclose such
information at least annually thereafter.

 

4. Compensation. As compensation for the services to be performed by the
Executive during the Term, the Company shall provide to the Executive:

 

(a) an annual base salary of not less than three hundred thousand dollars
($300,000), with an increase to three hundred twenty-five thousand dollars
($325,000) effective January 1, 2005 (“Salary”);

 

(b) a target annual incentive opportunity of not less than sixty percent (60%)
of the Salary (“Target Annual Incentive”). The performance goals required to
earn the Target Annual Incentive shall be

 

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approved by the Board of Directors and communicated to the Executive prior to
the end of the first quarter of the year for which the opportunity pertains; and

 

(c) a target annualized long-term incentive opportunity at a percentage
appropriate to similarly situated Executives in the Company’s next Long-Term
Incentive Plan, which is contemplated to commence in 2004 (“Target Long-Term
Incentive”). The performance goals required to earn the Target Long-Term
Incentive shall be approved by the Board of Directors and communicated to the
Executive prior to the end of the first quarter of the performance period for
which the opportunity pertains. If such performance period is longer than one
year, the Target Long-Term Incentive opportunity shall be adjusted accordingly
based on the number of years in the performance period.

 

Should the Company elect to increase any element of the Executive’s compensation
during the Term, the Agreement shall be deemed amended to incorporate the new
increased Salary or Target Annual Incentive or Target Long-Term Incentive
effective as of the date specified for the increase. The payment of any
compensation hereunder shall be subject to applicable withholding and payroll
taxes, and such other deductions as may be required under the Company’s employee
benefit plans, and shall be paid in accordance with the Company’s normal payroll
and incentive administration practices as they may exist from time to time.

 

5. Benefits. In addition to the payments set forth in Section 4, the Executive
shall:

 

(a) be eligible to participate in all fringe benefits, paid time off program,
incentive plans, and retirement programs, both tax-qualified and non-qualified,
that may be provided by the Company for its executives, in accordance with the
provisions of any such programs or plans;

 

(b) be eligible to participate in any life, disability or other similar
insurance plans, medical and dental plans or other employee welfare benefit
plans that may be provided by the Company for its executives, in accordance with
the provisions of any such plans; and

 

(c) be eligible to participate in any post retirement medical, dental and life
insurance plans that may be provided by the Company for its

 

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executives, in accordance with the provision of any such plans, but with the
payment of whatever contribution that the Company requires that other such
retirees would pay for such coverage.

 

6. Expenses. The Company shall, in accordance with and to the extent of its
policies, pay all ordinary and necessary business expenses incurred by the
Executive in performing his duties as an executive. The Executive shall account
promptly for all such business expenses in the manner prescribed by the Company.

 

7. Termination. The Executive’s employment shall be terminated upon the
occurrence of any of the following:

 

(a) the death of the Executive;

 

(b) the Executive’s disability (as such term is defined in the Company’s
executive long-term disability plan) (“Disability”);

 

(c) the termination of employment by the Executive for any reason;

 

(d) the termination of employment by the Company For Cause (as defined below);
or

 

(e) the termination of employment by the Company other than For Cause.

 

The term “For Cause” or “Cause” shall mean a reasonable determination by the
Company that the Executive (i) has been convicted of a felony, (ii) has engaged
in an activity which, if proven in a criminal proceeding, could result in
conviction of a felony involving dishonesty or fraud, or (iii) has willfully
engaged in gross misconduct likely to be materially damaging or materially
detrimental to the Company. In order to be effective, the Company must give the
Executive at least sixty (60) calendar days advance written notice of its intent
to terminate his employment “For Cause” setting forth the specific action(s) by
the Executive which triggered the notice and such written notice must be
received by the Executive no more than one hundred eighty (180) calendar days
after the Company learned of the action(s) giving rise to the “For Cause”
termination.

 

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8. Death of The Executive. In the event the Executive’s employment is terminated
as a result of the Executive’s death, the estate of the Executive shall be
entitled to receive the Executive’s Salary for a period of the lesser of six (6)
months or the unexpired portion of the Term, plus an amount equal to fifty
percent (50%) of Target Annual Incentive and Target Long-Term Incentive for the
year of death.

 

9. Disability of The Executive. In the event the Executive’s employment is
terminated as a result of Disability, the Executive shall be entitled to receive
his Salary and medical and dental benefits for a period of the lesser of six (6)
months or the unexpired portion of the Term, plus an amount equal to fifty
percent (50%) of Target Annual Incentive and Target Long-Term Incentive for the
year of Disability, reduced by any payments received by the Executive under the
Company’s executive long-term disability plan.

 

10. Executive-Initiated Termination or Company-Initiated For Cause. If the
Executive terminates this Agreement for any reason other than that provided in
Section 11 or the Company terminates this Agreement For Cause, the Company shall
have no further obligations and liabilities under this Agreement after the
termination of employment.

 

11. Termination Other Than For Cause. In the event the Executive’s employment is
terminated by the Company other than For Cause, or if the Executive terminates
this Agreement because the Company has failed to comply with Section 2, the
Company shall have no further obligations or liabilities under this Agreement
except that the Company shall pay, for the greater of eighteen (18) months or
the remainder of the Term, the following to the Executive if the Executive
satisfies the terms of Section 13:

 

(a) the Executive’s Salary;

 

(b) the Annual Incentive and Long-Term Incentive awards for the year of
termination, based upon the achievement of the performance goals for the plans
for the entire year of termination prorated to reflect the full number of months
the Executive was employed during that year;

 

(c) all unvested, prior Long-Term Incentive awards;

 

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(d) an amount equal to fifty percent (50%) of any Target Annual Incentive and
Target Long-Term Incentive opportunity which the Executive would otherwise have
been eligible to receive as of the effective date of the Executive’s termination
of employment; and

 

(e) the medical and dental plan benefits for which the Executive would otherwise
have been eligible to receive as of the effective date of the Executive’s
termination of employment.

 

12. Payment of Compensation Described in Sections 8, 9 or 11. The compensation
items specified in Sections 8, 9 or 11 shall be paid as follows:

 

(a) the Salary shall be paid over the remaining Term or other period as
described in Sections 8, 9 or 11 in accordance with the Company’s normal payroll
practices; and

 

(b) the current and future Annual and Long Term Incentive awards and
opportunities shall be paid within ninety (90) days after the end of the
performance period for which the incentive applied.

 

13. Execution of Release. As a condition of receiving the compensation and
benefits described in Sections 9 or 11, the Executive shall first execute a
release of any and all claims arising out of the Executive’s employment with the
Company or the Executive’s separation from such employment (including, without
limitation, claims relating to age, disability, sex or race discrimination to
the extent permitted by law), excepting only claims arising out of the alleged
breach of this Agreement or of any other written contract between the Executive
and the Company. Such release shall be in a form reasonably satisfactory to the
Company and shall comply with any applicable legislative or judicial
requirements, including, but not limited to, the Older Workers Benefit
Protection Act. An example of such release is attached as Attachment A.

 

14. Protection of the Company’s Business. The Executive acknowledges that in the
course of his employment he will acquire knowledge of trade secrets and
confidential data of the Company. Such trade secrets and confidential data may
include, but are not limited to, confidential product information, provider
contracts, customer lists, technical information, methods by which the Company
proposes to compete with its business competitors, strategic

 

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and business plans, confidential reports prepared by business consultants which
may reveal strengths and weaknesses of the Company and its competition and
similar information relating to the Company. The Executive, in order to perform
his obligations under this Agreement, must necessarily acquire knowledge of such
trade secrets and confidential data, all of which the Executive acknowledges are
not known outside the business of the Company, are known only to a limited group
of its top executives and directors, are protected by strict measure to preserve
secrecy, are of great value to the Company, are the result of the expenditure of
large sums of money, are difficult for an outsider to duplicate, and disclosure
of which would be extremely detrimental to the Company. The Executive covenants
to keep all such trade secrets or confidential data secret and not to release
such information to persons not authorized by the Company to receive such
secrets and data, both during the term of this Agreement and at all times
following its termination. The Executive acknowledges that trade secrets and
confidential data need not be expressly marked as such by the Company.

 

15. Documents, Etc. All records, files, documents, equipment and the like shall
be, and remain, the sole property of the Company. The Executive, on the
termination of his employment, shall immediately return to the Company all such
items without retention of any copies.

 

16. Limited Non-Competition. During the Executive’s employment and for a limited
time thereafter, the Company must protect its legitimate business interests by
limiting the Executive’s ability to compete with the Company. This limited
non-competition provision is drafted narrowly so as to be able to safeguard the
Company’s legitimate business interests while not unreasonably interfering with
the Executive’s ability to obtain other employment. The Company does not intend,
and the Executive acknowledges, that this limited non-competition provision is
not an attempt to prevent the Executive from obtaining other employment. The
Executive further acknowledges that the Company may need to take action,
including litigation, to enforce this limited non-competition provision, which
efforts the parties stipulate shall not be deemed an attempt to prevent the
Executive from obtaining other employment.

 

(a) During Employment By Company. During the Executive’s employment, Executive
shall not, directly or indirectly, have any ownership interest in, work for,
advise, manage, or act as an agent or consultant for, or have any business
connection or business or employment relationship with any person or entity that
competes with the Company or

 

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that contemplates competing with the Company without the prior written approval
of the Chief Executive Officer.

 

(b) During Post-Employment Period. For a period of eighteen (18) months after
the Executive’s termination of employment (regardless of the reason), or for the
duration of the Executive’s receipt of Salary under Section 11, whichever is
longer, the Executive shall not:

 

(i)(A) directly or indirectly have any ownership interest in any entity or
person engaged in development or sale of a product or service which competes
with or is substantially similar to any product or service sold by the Company,
in any jurisdiction in which the Company operates or in which the Company
reasonably expects to operate pursuant to provisions of a strategic plan adopted
by the Board of Directors;

 

(i)(B) directly or indirectly have any ownership interest in any entity or
person engaged in development or sale of a product or service which competes
with or is substantially similar to any product or service sold by the Company,
within the geographical area in which the Executive has been performing services
on behalf of the Company or for which he has been assigned responsibility at any
time within the twenty-four (24) months preceding his termination;

 

(ii)(A) in a competitive capacity, directly or indirectly work for, advise,
manage, or act as an agent or consultant for or have any business connection or
business or employment relationship with any entity or person engaged in
development or sale of a product or service which competes with or is
substantially similar to any product or service sold by the Company, in any
jurisdiction in which the Company operates or in which the Company reasonably
expects to operate pursuant to provisions of a strategic plan adopted by the
Board of Directors;

 

(ii)(B) in a competitive capacity, directly or indirectly work for, advise,
manage, or act as an agent or consultant for or have any business connection or
business or employment relationship with any entity or person engaged in
development or sale of a product or service which competes with or is
substantially similar to any product or service sold by the Company, within the
geographical area in which the Executive has been performing services on behalf
of the Company or for which the Executive

 

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has been assigned responsibility at any time within the twenty-four (24) months
preceding his termination;

 

(iii)(A) directly or indirectly market, sell or otherwise provide any product or
service which is competitive with or substantially similar to any product or
service sold by the Company, to any customer of the Company with whom the
Executive has had contact (either directly or indirectly) or over which he has
had responsibility at any time within the twenty-four (24) months preceding his
termination;

 

(iii)(B) directly or indirectly market, sell or otherwise provide any product or
service which is competitive with or substantially similar to any product or
service sold by the Company, to any customer of the Company; or

 

(iv) directly or indirectly, on behalf of the Executive or any third party, make
any business contacts with, solicit or accept business from any customer of the
Company for any product or service which is competitive with or substantially
similar to any product or service sold by the Company;

 

(c) Separate and Several Covenants. The Executive acknowledges that after
termination of his employment, he will inevitably possess trade secrets and
confidential data of the Company which he would inevitably use if he were to
engage in conduct prohibited as set forth above, and such use would be unfair to
and extremely detrimental to the Company. The Executive further acknowledges
that in view of the benefits provided him by this Agreement, such conduct on his
part would be inequitable. Accordingly, the Executive separately and severally
covenants for the benefit of the Company to keep each of the covenants described
in this Section 16 for the period specified above.

 

(d) Acknowledgment of the Company’s Superseding Interest in Protecting its
Business. The Executive recognizes that personal relationships between the
Company, its employees and customers are essential to the Company’s business
operations and that the Company furthers such relationships by investments of
time and money. The Executive recognizes that this Agreement is reasonably
necessary to protect the Company’s legitimate interest in its customers, and to
protect the

 

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Company’s confidential information and goodwill, and acknowledges that nothing
contained in this Agreement shall unreasonably alter the Executive’s ability to
obtain a livelihood or preclude the Executive from engaging in his profession.
The Executive, therefore, acknowledges that the Company’s interest in
maintaining its relationships with its established customers for at least one
(1) year after termination of the Executive’s employment, or for the duration of
the Executive’s receipt of Salary under Section 11, whichever is longer,
supersedes any interest of the Executive in soliciting, servicing, or accepting
the Company’s customers on behalf of any entity other than the Company during
that period of time.

 

(e) Publicly Traded Stock. Nothing in the foregoing provisions of this section
prohibits the Executive from purchasing for investment purposes only, any stock
or corporate security traded or quoted on a national securities exchange or
national market system.

 

(f) Maximum Application. The parties expressly agree that the terms of this
limited non-competition provision under this section are reasonable,
enforceable, and necessary to protect the Company’s interests, and are valid and
enforceable. In the unlikely event, however, that a court of competent
jurisdiction were to determine that any portion of this limited non-competition
provision is unenforceable, then the parties agree that the remainder of the
limited non-competition provision shall remain valid and enforceable to the
maximum extent possible.

 

17. Other Limited Prohibitions. During the Executive’s employment and for the
longer of one (1) year after termination, or for the duration of the Executive’s
receipt of Salary under Section 11, the Executive shall not:

 

(a) request or advise any customer of the Company, or any person or entity
having business dealings with the Company, to withdraw, curtail or cease such
business with the Company;

 

(b) disclose to any person or entity the identities of any customers of the
Company, or the identity of any persons or entities having business dealings
with the Company; or

 

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(c) directly or indirectly influence or attempt to influence any other employee
of the Company to separate from the Company.

 

18. Specific Enforcement/Injunctive Relief. The Executive agrees that it would
be difficult to measure damages to the Company from any breach of the covenants
contained in Sections 14 through 17, but that such damages from any breach would
be great, incalculable and irremediable, and that damages would be an inadequate
remedy. Accordingly, the Executive agrees that the Company may have specific
performance of the terms of this Agreement in any court permitted by this
Agreement. In addition, if the Executive violates the non-competition provisions
of Section 16 or 17, the Executive agrees that any period of such violation
shall be added to the term of the non-competition. For example, if the Executive
violated the provision for three (3) months, the Company would be entitled to
enforce the non-competition provision for one (1) year, or for the duration of
the Executive’s receipt of Salary under Section 11, plus three (3) months
post-termination. In determining the period of any violation, the parties
stipulate that in any calendar month in which the Executive engages in any
activity violative of the non-competition provision, the Executive is deemed to
have violated the non-competition provision for the entire month, and that month
shall be added to the duration of the non-competition provision as set out
above. The parties agree however, that specific performance and the “add back”
remedies described above shall not be the exclusive remedies, and the Company
may enforce any other remedy or remedies available to it either in law or in
equity including, but not limited to, temporary, preliminary, and/or permanent
injunctive relief.

 

19. Severability. If any provision of this Agreement is held invalid, such
invalidity shall not affect the other provisions of this Agreement which shall
be given effect independently of the invalid provisions and, in such
circumstances, the invalid provision is severable.

 

20. Governing Law. This Agreement shall be construed in accordance with the laws
of the State of Indiana. The parties expressly agree that it is appropriate for
Indiana law to apply to: (i) the interpretation of the Agreement; (ii) any
disputes arising out of this Agreement; (iii) any disputes arising out of the
employment relationship of the parties; and (iv) any and all other disputes
between the parties.

 

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21. Choice of Forum. The Company is based in Indiana, and the Executive
understands and acknowledges the Company’s desire and need to defend any
litigation against it in Indiana. Accordingly, the parties agree that any claim
of any type brought by the Executive against the Company or any of its employees
or agents must be maintained only in a court sitting in Marion County, Indiana,
or, if a federal court, the Southern District of Indiana, Indianapolis Division.

 

The Executive further understands and acknowledges that in the event the Company
initiates litigation against the Executive, the Company may need to prosecute
such litigation in the Executive’s forum state, in the State of Indiana, or in
such other state where the Executive is subject to personal jurisdiction.
Accordingly, the parties agree that the Company can pursue any claim against the
Executive in any forum in which the Executive is subject to personal
jurisdiction. The Executive specifically consents to personal jurisdiction in
the State of Indiana.

 

22. Mandatory Arbitration. Any controversy or claim arising out of, or relating
to this Agreement, or the breach thereof, other than a claim arising out of the
Executive’s breach of the confidentiality and non-competition provisions of
Section 14 through 17, shall be settled by arbitration in Indianapolis, Indiana,
in accordance with the Rules of the American Arbitration Association before
arbitrators who are licensed to practice law. The arbitrator or arbitrators
shall apply the substantive law of Indiana or federal law, or both, as
applicable to the dispute. Any award entered shall be final, binding and
nonappealable, and judgment upon the award rendered by the arbitrator or
arbitrators may be entered in any court having jurisdiction thereof.

 

In the event that the Company refuses or otherwise fails to make a payment when
due and it is ultimately decided that the Executive is entitled to such payment,
such payment shall be increased to reflect an interest equivalent for the period
of delay, compounded annually, equal to the prime or base lending rate used by
Bank One Indiana, NA, and in effect as of the date the payment was first due.

 

23. Non-Jury Trials. Notwithstanding the provisions of Sections 18 and 22 above,
and if the provisions of Section 18 or 22 above are not enforceable, the
Executive expressly waives any rights to a jury trial and agrees that any claim
of any type made against the Company or its agents or executives (including, but
not limited to, employment discrimination litigation, wage

 

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litigation, defamation, or any other claim) lodged in any court will be tried,
if at all, without a jury.

 

24. Nonalienation of Benefits. Except as may otherwise be required by law, no
right to receive payments under this Agreement shall be subject to anticipation,
commutation, alienation, sale, assignment, encumbrance, charge, pledge,
bankruptcy or hypothecation or to exclusion, attachment, levy or similar process
or assignment by operation of law, and any attempt, voluntary or involuntary, to
effect any such action shall be null, void and of no effect.

 

25. Legal Fees and Costs. All legal and other fees and expenses, including,
without limitation, any arbitration expenses, incurred by the Executive in
connection with contesting or disputing any termination of employment, in
seeking to obtain or enforce any right or benefit provided for in this
Agreement, or in otherwise pursuing any right or claim, shall be paid by the
Company, to the extent permitted by law, provided that the Executive makes a
formal written settlement demand prior to trial or arbitration and is ultimately
successful, in obtaining through trial or arbitration more than fifty percent
(50%) of the monetary relief sought, in his final written settlement demand
exclusive of attorney’s fees.

 

26. Notices. Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and will be deemed to have been given when
delivered in person (to the Executive if such notice is for the Executive) or
five (5) days following sending by overnight courier or mailing by first class,
certified or registered mail, postage prepaid, to the Executive at his home
address, or such addresses as the Executive shall have designated in writing, or
if to the Company, to the attention of the Corporate Secretary, at the Company’s
principal place of business, 120 Monument Circle, Indianapolis, Indiana 46204.

 

27. Headings. The various headings of this Agreement are inserted for
convenience only and shall not affect the meaning or interpretation of this
Agreement or any of its provisions.

 

28. Successors and Assigns. The rights and obligations of the Company under this
Agreement shall inure to its benefit, its successors and affiliated companies
and shall be binding upon the successors and assigns of the Company. This
Agreement, being personal to the Executive, cannot be assigned

 

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by the Executive, but his personal representative shall be bound by all its
terms and conditions.

 

29. Waiver and Amendments, Etc. Failure of the Company to insist upon strict
compliance with any terms or provisions of this Agreement shall not be deemed a
waiver of any terms, provisions or rights of the Company. Moreover, no
modifications, amendments, extensions or waivers of this Agreement or any
provisions hereof shall be binding upon the Company or the Executive unless in
writing and signed by the Executive and the Company.

 

30. Complete Agreement. This Agreement constitutes the entire employment
agreement of the parties and supersedes all prior employment agreements
addressing the terms, conditions, and issues contained herein. Nothing in this
Agreement, however, affects any separate written agreements addressing other
terms and conditions and issues agreed to by the parties.

 

31. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same agreement.

 

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IN WITNESS WHEREOF, the Company and the Executive have duly executed and
delivered this Agreement effective as of the day and year first above written.

 

Randall Lewis

/s/ Randall Lewis

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Anthem, Inc.

By:

 

/s/ Larry C. Glasscock

Name:

 

Larry C. Glasscock

Title:

 

President and Chief Executive Officer

 

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