BAXTER INTERNATIONAL INC

To assist you in reviewing the proposals to be acted upon at the Annual Meeting, this section presents concise detail about eachnon-routine voting item. For more complete information, please review the company’s Annual Report on Form 10-K for the year ended December 31, 2023 (the 2023 Form 10-K) and the complete proxy statement.

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Key

2023 Board and Governance Highlights

• Continued Board focus on refreshment led to the appointment of two new independent directors and changes inBoard and committee composition and responsibilities in 2023, as described below.

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Board Qualifications, Experiences and Backgrounds

The matrix included below represents some of the key skills, experiences and backgrounds that the Board has identified as particularly valuable to the oversight of the company and illustrates how the current directors individually and collectively represent these key competencies and backgrounds. While all of these qualifications were considered by the Board and the NCGPP Committee in connection with this year’s director nomination process, the matrix does not encompass all of the skills, experience, qualifications and attributes of the director nominees, and neither do the Board nor NCGPP Committee assign any specific weights to any of the skillsets in the matrix. Additionally, the fact that a particular skill, experience, qualification or attribute for a nominee is not listed below does not mean that he or she does not possess that skill, experience, qualification or attribute. The Board firmly believes that its highly qualified director nominees provide the Board with a diverse complement of skills, experience and perspectives necessary for effective oversight.

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Additional information regarding the director nominees, including with respect to average tenure, average age and gender and ethnic/racial diversity statistics as of March 14, 2024, is set forth below:

Performance Highlights

The amounts set forth above represent Baxter’s publicly disclosed results for 2023 from continuing operations. Adjusted earnings per share and free cash flow arenon-GAAP financial measures. Adjusted earnings per share excludes the impact of special items, net of the related income tax effects. Free cash flow represents net cash provided by operating activities less capital expenditures. See Baxter’s Periodic Report on Form 8-K dated February 8, 2024 for a reconciliation of the amounts set forth above to the applicable measure calculated in accordance with GAAP and for information about why management believes thatnon-GAAP financial measures, when used in conjunction with the results presented in accordance with U.S. GAAP and the company’s reconciliations to corresponding U.S. GAAP financial measures, may enhance an investor’s overall understanding of the company’s past financial performance and prospects for the future. Non-GAAP financial measures should be considered in addition to, and not as substitutes for, information prepared in accordance with U.S. GAAP.

For purposes of calculating performance under the company’s 2023 annual incentive plan, net sales were calculated at budgeted exchange rates (as of January 1, 2023) and included net sales from discontinued operations for the first nine of months of 2023. This measure is referred to herein as Adjusted Net Sales Including Discontinued Operations and was $15.0 billion for 2023. The net sales target under the company’s 2023 annual incentive plan was adjusted to exclude BPS sales targets for the three-month period following the company’s divestiture of that business.

For purposes of calculating performance under the company’s 2023 annual incentive plan, Adjusted earnings per share included adjusted earnings per share from discontinued operations. This measure is referred to herein as Adjusted EPS Including Discontinued Operations and was $2.92 for 2023. The adjusted earnings per share target under the company’s 2023 annual incentive plan was adjusted to exclude BPS earnings targets for the three-month period following the company’s divestiture of that business.

For purposes of calculating performance under the company’s 2023 annual incentive plan, free cash flow included free cash flow from discontinued operations for the first nine months of 2023, less certain income tax payments related to discontinued operations that were disbursed in the fourth quarter of 2023 (to the extent that those fourth quarter tax payments for discontinued operations were included in the company’s 2023 free cash flow target). This measure is referred to herein as Adjusted Free Cash Flow Including Discontinued Operations and was $1.1 billion for 2023. The free cash flow target under the company’s 2023 annual incentive plan was adjusted to exclude BPS cash flow targets for the three-month period following the company’s divestiture of that business, except for the income tax payments referred to above.

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See “Executive Compensation—Compensation Discussion and Analysis—Elements of Executive Compensation—Annual Incentive Plan—Determination of 2023 Annual Incentive Plan Payouts” for reconciliations of Adjusted Net Sales Including Discontinued Operations, Adjusted EPS Including Discontinued Operations and Adjusted Free Cash Flow Including Discontinued Operations to the applicable measures calculated in accordance with GAAP.

Compensation Design for 2023

The table below summarizes Baxter’s consistent compensation design for 2023 and highlights design and payouts are linked to Baxter’spay-for-performance philosophy. More detail regarding plan design can be found in the “Executive Compensation—Compensation Discussion and Analysis” section of the proxy statement.

Items to consider when evaluating this proposal:

On February 13, 2024, the Board approved the Baxter International Inc. Amended and Restated 2021 Incentive Plan, subject to stockholder approval at the Annual Meeting. The Board believes that it is in the best interests of Baxter and its stockholders to adopt an amended and restated incentive plan to increase stockholder value by providing opportunities for the company to reward and motivate employees, directors and others who provide services to Baxter by linking performance with long-term stockholder value creation. This Baxter International Inc. Amended and Restated 2021 Incentive Plan is needed to provide sufficient shares to support ongoing execution against the company’s strategic initiatives, including the proposed separation of the company’s Kidney Care business, and in light of the effects of changes in the company’s stock price and the increase in the number of equity-eligible participants following the acquisition of Hill-Rom Holdings, Inc. (Hillrom) in December 2021.

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Items to consider when evaluating this proposal:

In August 2022, the Delaware General Corporation Law (the DGCL) was amended to permit Delaware corporations to exculpate specified officers from personal liability in connection with certain actions. Previously, exculpation was only available for directors. Baxter’s Amended and Restated Certificate of Incorporation currently provides for the exculpation of directors pursuant to the DGCL but does not include a provision that allows for the exculpation of officers. After careful consideration, the Board has determined it is in the best interest of the company to amend the Amended and Restated Certificate of Incorporation to permit exculpation of the company’s officers to the extent permitted under the DGCL. The Board believes that the proposed officer exculpation provision provides the right balance between stockholders’ interest in accountability and their interest in the company being able to mitigate the disruptive impact of litigation and to attract and retain executive talent. Further, the Board believes that the amendment would not negatively impact stockholder rights and may potentially reduce litigation costs associated with frivolous lawsuits.

Items to consider when evaluating this proposal:

• Baxter’s current stock ownership guidelines already require significant stock retention by executives: Baxter’s CEO is required to achieve ownership of Baxter common stock valued at a minimum of six times annual base salary within five years of appointment. Each other executive officer, including the NEOs of the company who would be covered by this proposal, is required to achieve ownership of Baxter common stock valued at a minimum of four times annual base salary within five years of becoming an executive officer. • The company’s existing stock ownership guidelines are accomplishing their intended purpose: As of December 31, 2023, each of the NEOs who was still employed by Baxter as of such date had met his or her ownership requirements or, using reasonable assumptions, was on track to achieve his or her stock ownership objective within the prescribed time frame. • The proposal fails to strike a reasonable balance between aligning the interests of stockholders and management and motivating desired management behavior: The Board believes that Baxter’s emphasis on long-term incentive grants motivates executives to drive the long-term performance of the company and aligns their long-term interests with those of stockholders. However, Baxter also recognizes the fact that executives need some flexibility to manage their own financial affairs, which may, from time to time, include the sale of Baxter stock held as a result of the vesting of these equity grants that exceed the ownership guidelines. • The proposal would put Baxter at a competitive disadvantage for attracting and retaining top executive talent and would create an unnecessary administrative burden on Baxter without commensurate value to stockholders: Requiring NEOs to hold additional shares until retirement is more stringent than current market practice and would be unnecessarily burdensome to the executives, which, as a result, may impact Baxter’s ability to attract and retain top executive talent. Further, the NEOs often change year-to-year and this proposal may place different stock retention requirements on certain executives every year, which would be difficult for Baxter to administer. Instead, the company believes its current robust stock ownership requirements, which are consistent with market practice and apply to all of Baxter’s executive and corporate officers, provide meaningful stock ownership and retention requirements at a lower administrative cost for the company. • The majority of Baxter’s stockholders voted against a similar proposal last year: Baxter’s stockholders have considered, and rejected, a similar proposal in 2023, indicating that Baxter’s stockholders remain supportive of the Board’s position on this proposal and current executive compensation structure.

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