Document:

EX-10.1

 Exhibit 10.1 

EMPLOYEE MATTERS AGREEMENT 

BY AND BETWEEN 
 BAXTER
INTERNATIONAL INC. 
 AND 

BAXALTA INCORPORATED 

DATED AS OF JUNE 30, 2015 

EMPLOYEE MATTERS AGREEMENT 

 TABLE OF CONTENTS 

 

					
	 	 	 	  	Page
		
	ARTICLE I DEFINITIONS	  	  1
	 Section 1.01
	 	Defined Terms	  	  1
		
	ARTICLE II GENERAL PRINCIPLES	  	10
	 Section 2.01
	 	Allocation of Liabilities	  	10
	 Section 2.02
	 	Employment with Baxalta	  	12
	 Section 2.03
	 	Establishment of Baxalta Plans	  	13
	 Section 2.04
	 	Non-Hire; Non-Solicit	  	14
	 Section 2.05
	 	Post-Distribution Employment in Deferred Baxalta Local Businesses	  	15
	 Section 2.06
	 	Collective Bargaining	  	17
	 Section 2.07
	 	Distributorship Model	  	17
		
	ARTICLE III U.S. AND PUERTO RICO QUALIFIED AND NON-QUALIFIED RETIREMENT PLANS	  	17
	 Section 3.01
	 	Baxalta Pension Plan	  	17
	 Section 3.02
	 	Incentive Investment Plan	  	21
	 Section 3.03
	 	Supplemental Pension Plan	  	23
	 Section 3.04
	 	Deferred Compensation Plan	  	25
		
	ARTICLE IV NON-U.S. RETIREMENT PLANS	  	26
	 Section 4.01
	 	Establishment of Non-U.S. Retirement Plans and Transfers of Assets and Liabilities	  	26
	 Section 4.02
	 	Shared Plan Model	  	28
		
	ARTICLE V WELFARE AND FRINGE BENEFIT PLANS	  	31
	 Section 5.01
	 	Health and Welfare Plans	  	31
	 Section 5.02
	 	COBRA and HIPAA	  	34
	 Section 5.03
	 	Vacation, Holidays and Leaves of Absence	  	34
	 Section 5.04
	 	Severance and Unemployment Compensation	  	34
	 Section 5.05
	 	Workers’ Compensation	  	35
		
	ARTICLE VI EQUITY, INCENTIVE, AND DIRECTOR AND EXECUTIVE COMPENSATION PROGRAMS	  	35
	 Section 6.01
	 	Equity Incentive Programs	  	35
	 Section 6.02
	 	Employee Stock Purchase Plan.	  	40
	 Section 6.03
	 	Annual Bonus	  	41
	 Section 6.04
	 	Directors’ Plan	  	41
	 Section 6.05
	 	Directors’ Deferred Compensation Plan	  	43
		
	ARTICLE VII MISCELLANEOUS	  	45
	 Section 7.01
	 	Transfer of Records and Information	  	45
	 Section 7.02
	 	Cooperation	  	45
	 Section 7.03
	 	Employee Agreements	  	45

  
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	 Section 7.04
		Repayment Assets		45
	 Section 7.05
		Compliance		46
	 Section 7.06
		Preservation of Rights		46
	 Section 7.07
		Reimbursement		46
	 Section 7.08
		Matching Grant Plan		46
	 Section 7.09
		Not a Change in Control		46
	 Section 7.10
		Incorporation by Reference		46
	 Section 7.11
		Limitation on Enforcement		47
	 Section 7.12
		Further Assurances and Consents		47
	 Section 7.13
		Third Party Consent		47
	 Section 7.14
		Effect if Distribution Does Not Occur		47
	 Section 7.15
		Disputes		47
	 Section 7.16
		Reverse Jurisdiction		47

  
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 This EMPLOYEE MATTERS AGREEMENT dated as of June 30, 2015, is by and between BAXTER
INTERNATIONAL INC., a Delaware corporation (“Baxter”), and BAXALTA INCORPORATED, a Delaware corporation (“Baxalta”). 

RECITALS: 
 WHEREAS, the
Baxter Board has determined that it is appropriate and advisable to separate the Baxalta Business from the Baxter Business; 
 WHEREAS, to
achieve the foregoing, the Parties have executed a Separation and Distribution Agreement which provides for, among other things, the contribution from Baxter to Baxalta of certain Assets, the assumption by Baxalta of certain Liabilities from Baxter,
the distribution by Baxter of Baxalta Common Stock to Baxter shareholders, and the execution and delivery of this Agreement and certain other agreements to facilitate and provide for the foregoing, in each case subject to the terms and conditions
set forth therein; 
 WHEREAS, the Employees of the Baxalta Business are currently employed by the Baxter Group and are expected to become
Employees of the Baxalta Group; and 
 WHEREAS, this Agreement describes the principal employment, compensation and employee benefit plan
arrangements between the Parties. 
 NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this
Agreement, the Parties hereby agree as follows: 
 AGREEMENT 

ARTICLE I 
 DEFINITIONS

 Section 1.01 Defined Terms. The following capitalized terms as used in this Agreement shall have the meaning set
forth below unless otherwise specified herein: 
 “Adjusted Baxter Award” means a Baxter Option or Baxter RSU Award, as
adjusted in accordance with Section 6.01(a). 
 “Adjusted Baxalta Stock Value” means the product obtained by
multiplying (i) the Baxalta When-Issued Price times (ii) the Distribution Ratio. 
 “Adjusted Option Value” means
(i) the Baxter Stock Value minus (ii) the per share exercise price of the Baxter Option immediately prior to the Distribution Date. 

“Affiliate” has the meaning set forth in the Separation and Distribution Agreement. 

“Agreement” means this Employee Matters Agreement and each of the Schedules hereto. 

“Applicable Closing Date” has the meaning set forth in Section 4.01(a). 

 “Asset” has the meaning set forth in the Separation and Distribution Agreement.

 “Baxalta” has the meaning set forth in the Preamble. 

“Baxalta Award” means a Baxalta Option, Baxalta PSU Award, or Baxalta RSU Award granted pursuant to Section 6.01.

 “Baxalta Benefit Plan” means, following the Distribution, each Benefit Plan sponsored by, maintained by, or contributed
to by the Baxalta Group, provided that such term shall include, following the consummation of a Local Closing Transaction, each Benefit Plan sponsored by, maintained by, or contributed to by the applicable Deferred Baxalta Local Business.

 “Baxalta Board” means the Baxalta board of directors. 

“Baxalta Business” has the meaning set forth in the Separation and Distribution Agreement. 

“Baxalta Change of Control” has the meaning set forth in Section 6.01(b). 

“Baxalta Common Stock” has the meaning set forth in the Separation and Distribution Agreement. 

“Baxalta DCP” means the Baxalta Incorporated and Subsidiaries Deferred Compensation Plan. 

“Baxalta Directors’ DCP” means the Baxalta Incorporated Directors’ Deferred Compensation Plan. 

“Baxalta Directors’ Plan” means the Baxalta Incorporated Non-Employee Director Compensation Plan. 

“Baxalta Employee” means any Employee who is (i) employed by the Baxalta Group as of immediately prior to the
Distribution Date, (ii) a Post-Distribution Baxalta Employee, (iii) designated prior to the Distribution Date by Baxter as an individual whose employment is to transfer from the Baxter Group to the Baxalta Group, whether or not such
transfer occurs prior to, upon or after the Distribution Date or (iv) designated as a Baxalta Employee by joint agreement of the Parties (in all cases, other than an Employee who is designated by Baxter prior to the Distribution Date as
intended not to transfer to the Baxalta Group). 
 “Baxalta Equity Plan” means the Baxalta Incorporated 2015 Equity Plan.

 “Baxalta ESPP” means the Baxalta Incorporated Employee Stock Purchase Plan. 

“Baxalta Former Employee” means a Former Employee who, immediately prior to such individual’s termination of employment
with or by the Baxter Group, either (i) was designated by Baxter as an Employee whose employment was to transfer to the Baxalta Group or (ii) if not 

  
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so designated by Baxter, was primarily employed or engaged in the Baxalta Business (other than a Former Employee who was designated by Baxter as intended to become a Baxter Retained Employee).

 “Baxalta Group” means Baxalta and its Subsidiaries. 

“Baxalta Health and Welfare Plan” means, following the Distribution, a Health and Welfare Plan sponsored by, maintained by,
or contributed to by the Baxalta Group. 
 “Baxalta IIP” means the Baxalta Incorporated and Subsidiaries Incentive
Investment Plan. 
 “Baxalta Incentive Plan” means the Baxalta 2015 Incentive Plan. 

“Baxalta Pension Plan” means the Baxalta Incorporated and Subsidiaries Pension Plan. 

“Baxalta Percentage” means the quotient obtained by dividing (i) the Adjusted Baxalta Stock Value by (ii) the
Combined Stock Value. 
 “Baxalta Pre-Distribution Option Value” means the quotient obtained by dividing (i) the
product obtained by multiplying (A) the Adjusted Option Value times (B) the Baxalta Percentage by (ii) the Distribution Ratio. 

“Baxalta Retiree Health Care Plan” means the Baxalta Incorporated and Subsidiaries Retiree Plan. 

“Baxalta SERP” means the Baxalta Incorporated and Subsidiaries Supplemental Pension Plan. 

“Baxalta SIP” has the meaning set forth in Section 3.02(h). 

“Baxalta Stock Value” means the quotient obtained by dividing (i) the product obtained by multiplying (A) the
Baxter Stock Value by (B) the Baxalta Percentage, by (ii) the Distribution Ratio. 
 “Baxalta When-Issued Price”
means the volume weighted average per share price, as reported on the NYSE, of Baxalta Common Stock trading “when-issued” during Regular Trading Hours on the final five Trading Days immediately preceding the Effective Time. 

“Baxter” has the meaning set forth in the Preamble. 

“Baxter Benefit Plan” means a Benefit Plan sponsored by, maintained by, or contributed to by the Baxter Group. 

“Baxter Board” means the Baxter board of directors. 

“Baxter Business” has the meaning set forth in the Separation and Distribution Agreement. 

  
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 “Baxter Change of Control” has the meaning set forth in
Section 6.01(b). 
 “Baxter Common Shares” has the meaning set forth in the Separation and Distribution
Agreement. 
 “Baxter Compensation Committee” means the compensation committee of the Baxter Board. 

“Baxter DCP” means the Baxter International Inc. and Subsidiaries Deferred Compensation Plan. 

“Baxter Directors’ DCP” means the Baxter International Inc. Directors’ Deferred Compensation Plan, as amended and
restated effective January 1, 2014. 
 “Baxter Directors’ Plan” means the Baxter International Inc. Non-Employee
Director Compensation Plan. 
 “Baxter ESPP” means the Baxter International Inc. Employee Stock Purchase Plan. 

“Baxter Ex-Distribution Price” means the volume weighted average per share price, as reported on the NYSE, of Baxter Common
Shares trading “ex-distribution” during Regular Trading Hours on the final five Trading Days immediately preceding the Effective Time. 

“Baxter Former Employee” means a Former Employee who is not a Baxalta Former Employee. 

“Baxter Group” means Baxter and its Subsidiaries (excluding, after the Distribution, any member of the Baxalta Group). 

“Baxter Health and Welfare Plan” means a Health and Welfare Plan sponsored by, maintained by, or contributed to by the Baxter
Group. 
 “Baxter IIP” means the Baxter International Inc. and Subsidiaries Incentive Investment Plan. 

“Baxter Pension Plan” means the Baxter International Inc. and Subsidiaries Pension Plan. 

“Baxter Percentage” means the quotient obtained by dividing (i) the Baxter Ex-Distribution Price by (ii) the
Combined Stock Value. 
 “Baxter Pre-Distribution Option Value” means the product obtained by multiplying (i) the
Adjusted Option Value times (ii) the Baxter Percentage. 
 “Baxter Pre-Distribution Stock Value” means the product
obtained by multiplying (i) the Baxter Stock Value by (ii) the Baxter Percentage. 
 “Baxter Puerto Rico Pension
Plan” shall have the meaning set forth in Section 3.01(h). 
 “Baxter Retained Employee” means any
Employee other than a Baxalta Employee. 

  
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 “Baxter Retiree Health Care Plan” means the Baxter International Inc. and
Subsidiaries Retiree Plan. 
 “Baxter SERP” means the Baxter International Inc. and Subsidiaries Supplemental Pension Plan.

 “Baxter SIP” has the meaning set forth in Section 3.02(h). 

“Baxter Stock Programs” means, collectively, (i) the Baxter International Inc. 2000 Incentive Plan, (ii) the Baxter
International Inc. 2001 Incentive Plan, (iii) the Baxter International Inc. 2003 Incentive Plan, (iv) the Baxter International Inc. 2007 Incentive Plan, (v) the Baxter International Inc. 2011 Incentive Plan, (vi) the Baxter
International Inc. 2015 Incentive Plan, and (vii) any similar prior Baxter plans and all sub-plans or equity plans related to any of the foregoing, together with any incentive compensation program or arrangement that governs the terms of
equity-based incentive awards assumed by the Baxter Group in connection with a corporate transaction and that is maintained by the Baxter Group immediately prior to the Distribution Date, and any sub-plans established under those programs. 

“Baxter Stock Value” means the volume weighted average per share price, as reported on the NYSE, of Baxter Common Shares
trading “regular-way” during Regular Trading Hours on the final five Trading Days immediately preceding the Effective Time. 

“Benefit Plan” means any (i) “employee benefit plan,” as defined in ERISA Section 3(3) (whether or not
such plan is subject to ERISA); and (ii) employment, compensation, severance, salary continuation, bonus, thirteenth month, incentive, retirement, thrift, superannuation, savings, pension, workers’ compensation, termination benefit
(including termination notice requirements), termination indemnity, other indemnification, supplemental unemployment benefit, redundancy pay, profit sharing, deferred compensation, stock ownership, stock purchase, stock option, stock appreciation
right, restricted stock, “phantom” stock, performance share unit, restricted stock unit, other stock-based incentive, change in control, paid time off, perquisite, fringe benefit, vacation, disability, life, or other insurance, death
benefit, hospitalization, medical, or other compensatory or benefit plan, program, fund, agreement, arrangement, or policy of any kind (whether written or oral, qualified or nonqualified, funded or unfunded, foreign or domestic, currently effective
or terminated), and any trust, escrow or similar agreement related thereto, whether or not funded, excluding any plan, program, fund, agreement, arrangement, or policy (other than for workers’ compensation Liabilities) that is mandated by and
maintained solely pursuant to applicable Law. 
 “COBRA” means coverage required by Code Section 4980B or ERISA
Section 601 et. seq. 
 “Code” means the Internal Revenue Code of 1986, as amended. 

“Combined Stock Value” means the sum of (i) the Baxter Ex-Distribution Price and (ii) the Adjusted Baxalta Stock
Value. 
 “Conveyance and Assumption Instruments” has the meaning set forth in the Separation and Distribution Agreement.

  
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 “Deferred Baxalta Local Business” has the meaning set forth in the Separation
and Distribution Agreement. 
 “Distribution” has the meaning set forth in the Separation and Distribution Agreement. 

“Distribution Date” has the meaning set forth in the Separation and Distribution Agreement. 

“Distribution Ratio” means the number of shares of Baxalta Common Stock distributed in the Distribution in respect of one
Baxter Common Share. 
 “Effective Time” has the meaning set forth in the Separation and Distribution Agreement. 

“Employee” means an employee of the Baxter Group or the Baxalta Group, as applicable, including any employee absent from work
on account of long-term disability or workers’ compensation leave (in each case, unless treated as a separated employee for employment purposes), vacation, jury duty, funeral leave, personal leave, sickness, short-term disability, military
leave, family leave, pay continuation leave, or other approved leave of absence or for whom an obligation to recall, rehire or otherwise return to employment exists under a contractual obligation or Law. 

“Employee Agreement” means any employment contract, whether written or unwritten, between a member of the Baxter Group and an
Employee or Former Employee, including any standard form employee agreement customarily signed by certain Employees of the Baxter Group and any other form of employment agreement signed or otherwise effective under applicable local Law. 

“Employee Recoupment Asset” means an employer’s right to repayment from an employee in respect of a tax equalization
payment, sign-on bonus payment, relocation expense payment, tuition payment, reimbursement, loan, or other similar item, including any agreement related thereto. 

“Employment Tax” means withholding, payroll, social security, workers’ compensation, unemployment, disability and any
similar tax imposed by any Tax Authority or social security authority, and any interest, penalties, additions to tax, or additional amounts with respect to the foregoing imposed on any taxpayer or consolidated, combined, or unitary group of
taxpayers. With respect to any Employment Tax, the term “Tax Authority” means the governmental entity or political subdivision thereof that imposes such Employment Tax, and the agency (if any) charged with the collection of such
Employment Tax for such entity or subdivision. 
 “ERISA” means the U.S. Employee Retirement Income Security Act of 1974,
as amended. 
 “ESOP” means an employee stock ownership plan, as defined in ERISA Section 407(d)(6) and Code
Section 4975(e)(7). 

  
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 “Former Employee” means any individual whose employment with the Baxter Group
terminated on or prior to the Distribution Date, excluding any employee absent from work immediately prior to the Distribution Date on account of long-term disability or workers’ compensation leave (in each case, to the extent not treated as a
separated employee for employment purposes), vacation, jury duty, funeral leave, personal leave, sickness, short-term disability, military leave, family leave, pay continuation leave, or other approved leave of absence or for whom an obligation to
recall, rehire or otherwise return to employment exists under a contractual obligation or Law. 
 “Health and Welfare Plan”
means any Benefit Plan established or maintained to provide, through the purchase of insurance or otherwise, medical, dental, prescription, vision, short-term disability, long-term disability, death benefits, life insurance, accidental death and
dismemberment insurance, business travel accident insurance, employee assistance program, group legal services, wellness, cafeteria (including premium payment, health care flexible spending account, and dependent care flexible spending account
components), travel reimbursement, transportation, vacation benefits, apprenticeship or other training programs, day care centers, or prepaid legal services benefits, including any “employee welfare benefit plan” (as defined in ERISA
Section 3(1)) that is not a severance plan. 
 “HIPAA” means the Health Insurance Portability and Accountability Act
of 1996, as amended. 
 “Incurred Claim” means a Liability related to services or benefits provided under a Benefit Plan,
and shall be deemed to be incurred: (i) with respect to medical, dental, vision, and prescription drug benefits, upon the rendering of services giving rise to such Liability; (ii) with respect to death benefits, life insurance, accidental
death and dismemberment insurance, and business travel accident insurance, upon the occurrence of the event giving rise to such Liability; (iii) with respect to disability benefits, upon the date of disability, as determined by the disability
benefit insurance carrier or claim administrator, giving rise to such Liability; (iv) with respect to a period of continuous hospitalization, upon the date of admission to the hospital; and (v) with respect to tuition reimbursement or
adoption assistance, upon completion of the requirements for such reimbursement or assistance, whichever is applicable. 

“International Commercial Operations Agreement” has the meaning set forth in the Separation and Distribution Agreement. 

“Law” has the meaning set forth in the Separation and Distribution Agreement. 

“Liabilities” has the meaning set forth in the Separation and Distribution Agreement. 

“Local Closing Transaction” means the local closing transaction involving a Deferred Baxalta Local Business. 

“Non-U.S. Baxter Benefit Plan” means a Baxter Benefit Plan established, maintained, or contributed to by the Baxter Group
that is primarily for the benefit of Employees or Former Employees who work primarily outside of the United States. 
 “Non-U.S.
Baxalta Benefit Plan” means a Baxalta Benefit Plan established, maintained, or contributed to by the Baxalta Group that is primarily for the benefit of Employees or Former Employees who work primarily outside of the United States. 

  
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 “Non-U.S. Baxalta Employee” means a Baxalta Employee who works primarily outside
of the United States. 
 “Non-U.S. Health and Welfare Plan” means a Health and Welfare Plan established, maintained, or
contributed to by the Baxter Group or the Baxalta Group, as applicable, that is primarily for the benefit of Employees (including Former Employees or Baxalta Former Employees, as appropriate) who work primarily outside of the United States. 

“Offering” has the meaning set forth in the Baxter ESPP. 

“Offering Commencement Date” has the meaning set forth in the Baxter ESPP. 

“Offering End Date” has the meaning set forth in the Baxter ESPP. 

“Option” means (i) when immediately preceded by “Baxter,” an option to purchase one or more Baxter Common
Shares granted under a Baxter Stock Program and outstanding immediately prior to the Distribution Date (whether or not then vested or exercisable); (ii) when immediately preceded by “Adjusted Baxter,” an option to purchase one or more
Baxter Common Shares adjusted in accordance with Section 6.01 or Section 6.04; and (iii) when immediately preceded by “Baxalta,” an option to purchase one or more shares of Baxalta Common Stock granted by
Baxalta in accordance with Section 6.01 or Section 6.04. 
 “Parties” means the parties to this
Agreement. 
 “Pension Eligibility Date” has the meaning set forth in Section 3.01(c)(i). 

“Pension Split Date” has the meaning set forth in Section 3.01(a). 

“Post-Distribution Baxalta Employee” means any Employee whose intended transfer from the Baxter Group to the Baxalta Group in
connection with the Distribution is to occur after the Distribution Date, including (i) each Employee named as a Post-Distribution Baxalta Employee in Schedule 1.01, which lists those Employees transferring only upon a Local Closing
Transaction if employed in connection with a Deferred Baxalta Local Business and (ii) any other Employee whose intended transfer from the Baxter Group to the Baxalta Group in connection with the Distribution is to occur after the Distribution
Date, including any Employee hired on or after the Distribution Date (but prior to the applicable Transfer Date) to the extent such Employee is primarily related to a Deferred Baxalta Local Business or is hired to replace any terminated or departing
Employee who would have otherwise been a Post-Distribution Baxalta Employee. 
 “PSU Award” means (i) when immediately
preceded by “Baxter,” a performance share unit award granted pursuant to a Baxter Stock Program and outstanding immediately prior to the Distribution Date; (ii) when immediately preceded by “Adjusted Baxter,” a performance
share unit award granted pursuant to a Baxter Stock Program adjusted in accordance with Section 6.01; and (iii) when immediately preceded by “Baxalta,” a performance share unit award granted by Baxalta in accordance with
Section 6.01. 

  
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 “QDRO” means a qualified domestic relations order within the meaning of ERISA
Section 206(d) and Code Section 414(p). 
 “Regular Trading Hours” means the period beginning at 9:30 A.M. New
York City time and ending 4:00 P.M. New York City time. 
 “RSU Award” means (i) when immediately preceded by
“Baxter,” a restricted stock unit award granted pursuant to a Baxter Stock Program and outstanding immediately prior to the Distribution Date; (ii) when immediately preceded by “Adjusted Baxter,” a restricted stock unit
award granted pursuant to a Baxter Stock Program adjusted in accordance with Section 6.01 or Section 6.04; and (iii) when immediately preceded by “Baxalta,” a restricted stock unit award granted by Baxalta in
accordance with Section 6.01 or Section 6.04. 
 “Securities Act” means the U.S. Securities Act of
1933, as amended. 
 “Separation” has the meaning set forth in the Separation and Distribution Agreement. 

“Separation and Distribution Agreement” means the Separation and Distribution Agreement by and between the Parties, dated as
of June 30, 2015. 
 “Shared Plan Replacement Date” means the date of the establishment of the applicable Non-U.S.
Baxalta Benefit Plan. 
 “Subsidiary” has the meaning set forth in the Separation and Distribution Agreement. 

“Trading Day” means the period of time during any given calendar day, commencing with the determination of the opening price
on the NYSE and ending with the determination of the closing price on the NYSE, in which trading and settlement in Baxter Common Shares or Baxalta Common Stock, as applicable, is permitted on the NYSE. 

“Transfer Date” means, with respect to each (i) Baxalta Employee (other than a Post-Distribution Baxalta Employee), the
Distribution Date; and (ii) Post-Distribution Baxalta Employee, the date on which such person first becomes employed by the Baxalta Group following the Distribution Date. With respect to each Post-Distribution Baxalta Employee who is not
employed by a Deferred Baxalta Local Business, “Transfer Date” means the date determined jointly by Baxter and Baxalta, or in the absence of such agreement, such date as Baxter may determine based on the facts and circumstances applicable
to such Post-Distribution Baxalta Employee. 
 “Transferred Employee” has the meaning set forth in
Section 2.02(a)(i). 
 “Transferred Flexible Spending Account Balances” has the meaning set forth in
Section 5.01(c)(iii). 
 “Transferred Non-U.S. Employee” means a Transferred Employee who works primarily
outside of the United States. 

  
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 “Transition Services Agreement” has the meaning set forth in the Separation and
Distribution Agreement. 
 “United States” means, when used in a territorial sense, the fifty states of the United States
of America and the District of Columbia, but does not, unless otherwise specifically provided, include Puerto Rico or any other territory of the United States. 

“USERRA” means the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended. 

ARTICLE II 
 GENERAL
PRINCIPLES 
 Section 2.01 Allocation of Liabilities. 

(a) Baxalta Liabilities. Except as expressly provided in this Agreement, Baxalta hereby assumes (or retains) and agrees to pay,
perform, fulfill, and discharge all Liabilities to the extent relating to, arising out of, or resulting from or with respect to: 

(i) the employment (or termination of employment), including with respect to any statutory or other Liabilities (whether those
Liabilities are otherwise the legal responsibility of the Baxter Group or the Baxalta Group) triggered by or in connection with the Separation, of each Transferred Employee by the Baxter Group up to the applicable Transfer Date and by the Baxalta
Group on and after the applicable Transfer Date (including, in each case, all Liabilities with respect to any such Baxalta Employee relating to, arising out of, or resulting from Employment Taxes, Employee Agreements, any Baxter Benefit Plan or any
Baxalta Benefit Plan); 
 (ii) the retention of any individual who is, or was, an independent contractor, temporary
employee, temporary service worker, consultant, freelancer, agency employee, leased employee, on-call worker, incidental worker, or non-payroll worker or any other individual in any other similar relationship to the extent the services provided by
any such individual were primarily related to the Baxalta Group or the Baxalta Business; provided that, for the avoidance of doubt, this Agreement is not intended to, and does not, address any Liabilities in respect of the services provided
by consulting firms, investment advisory firms, valuation advisory firms, legal advisors or other third-party entities retained to provide advice with respect to or in connection with the Separation and Distribution; and 

(iii) Liabilities and responsibilities expressly assumed or retained by Baxalta pursuant to this Agreement. 

(b) Baxter Liabilities. Except as expressly provided in this Agreement, the Separation and Distribution Agreement or any Ancillary
Agreement other than any Conveyance and Assignment Instrument (to the extent such Ancillary Agreement provides for allocation of Liability related to services to be provided after the Distribution Date), Baxter

  
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hereby retains (or assumes) and agrees to pay, perform, fulfill, and discharge all Liabilities to the extent relating to, arising out of, or resulting from: 

(i) the employment (or termination of employment) of each Baxter Retained Employee by the Baxter Group prior to, on, or after
the Distribution Date (including all Liabilities with respect to any such Baxter Retained Employee to the extent relating to, arising out of, or resulting from Employment Taxes, Employee Agreements or any Baxter Benefit Plan); 

(ii) the employment (or termination of employment) of each Former Employee and each Baxalta Employee unless and until such
Baxalta Employee becomes a Transferred Employee (including all Liabilities to the extent relating to, arising out of, or resulting from Employment Taxes, Employee Agreements or any Baxter Benefit Plan); 

(iii) the retention of any individual who is, or was, an independent contractor, temporary employee, temporary service worker,
consultant, freelancer, agency employee, leased employee, on-call worker, incidental worker, non-payroll worker or any other individual in any other similar relationship to the extent the services provided by any such individual were primarily
related to the Baxter Group or the Baxter Business; provided that, for the avoidance of doubt, this Agreement is not intended to, and does not, address any Liabilities in respect of the services provided by consulting firms, investment
advisory firms, valuation advisory firms, legal advisors or other third-party entities retained to provide advice with respect to or in connection with the Separation and Distribution; and 

(iv) Liabilities and responsibilities expressly retained or assumed by Baxter pursuant to this Agreement. 

(c) Other Liabilities. To the extent that this Agreement does not cover particular Liabilities or responsibilities that relate to,
arise out of, or result from employment (or termination of employment), Employment Taxes, Employee Agreements or any Benefit Plan and the Parties later determine that they should be allocated in connection with the Separation, such Liabilities and
responsibilities shall be handled in a manner similar to the manner in which this Agreement handles comparable Liabilities and responsibilities, subject to the mutual agreement of the Parties. 

(d) Labor Relations. To the extent required by applicable Law or any contract or arrangement with a labor union, works council or
similar employee organization, Baxalta shall provide notice, engage in consultation and take any similar action which may be required after the Distribution Date on its part in connection with the Separation and shall fully indemnify each member of
the Baxter Group against any Liabilities arising from its failure to comply with such requirements. 

  
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 Section 2.02 Employment with Baxalta. 

(a) Employment Transfers. The Parties intend for Baxalta Employees to transfer to the Baxalta Group and shall use their respective best
efforts and cooperate with each other to effectuate this intent. 
 (i) Except as otherwise mutually agreed upon by the
Parties, as of each Baxalta Employee’s Transfer Date, the Baxalta Group shall: (A) continue to employ (on a basis consistent with Section 2.02(b)) each Baxalta Employee employed in a jurisdiction where employment continues
automatically by operation of Law (and such individual does not object, where such right exists under applicable Law); (B) offer to employ (on a basis consistent with Section 2.02(b)) each Baxalta Employee employed in a jurisdiction
where employment does not continue automatically by operation of Law; and (C) offer to employ (on a basis consistent with Section 2.02(b) or as otherwise required by applicable Law) each Former Employee who would have been a Baxalta
Employee had such Former Employee been employed on the Distribution Date, and whose right to re-employment is protected by any applicable Law, including any Former Employee covered by USERRA. Each Baxalta Employee who accepts an offer of employment
with the Baxalta Group, or who continues employment with the Baxalta Group following his or her Transfer Date automatically by operation of Law (and does not object where such right exists under applicable Law), as the case may be, will be referred
to in this Agreement as a “Transferred Employee.” 
 (ii) The Baxter Group may terminate the employment of
any Baxalta Employee who does not become a Transferred Employee as of his or her intended Transfer Date, or, if such Baxalta Employee cannot be terminated in accordance with applicable Law or otherwise, then the Baxter Group may terminate any other
Employee of the Baxter Group whose employment (in the sole judgment of Baxter) is made redundant as a result of the continued retention of such Baxalta Employee. The Baxter Group may also terminate the employment of any Baxalta Employee if retaining
such Employee would constitute a violation of applicable Laws or the Baxter Code of Conduct. Baxalta will be responsible for, and will indemnify the Baxter Group from and against, any Liabilities incurred or payments made (including any severance
payments made) in connection with the termination of a Baxalta Employee or any other Employee of the Baxter Group pursuant to this Section 2.02(a)(ii) to the extent of any payment occurring on or after the Distribution Date. 

(b) Compensation and Benefits. 

(i) Except as expressly provided in this Agreement or in local Conveyance and Assumption Instruments, no Transferred Employee
shall participate in any Baxter Benefit Plan following his or her Transfer Date. 
 (ii) Except as expressly provided in
this Agreement or as otherwise required by applicable Law, the Baxalta Group shall provide to each Transferred Employee as of his or her Transfer Date (A) base salary at the same rate as provided to that Transferred Employee immediately prior
to the Transfer Date, (B) cash 

  
 12 

 
incentive compensation opportunities that are comparable in the aggregate to those offered under the corresponding Baxter Benefit Plan(s) immediately prior to the Transfer Date, and
(C) benefits under the other Baxalta Benefit Plans that are comparable in the aggregate to benefits provided under the corresponding Baxter Benefit Plans immediately prior to the Transfer Date. Nothing in the preceding sentence shall prevent
the Baxalta Group from modifying the compensation and benefits of a Transferred Employee after such Transferred Employee’s Transfer Date. 

(c) Service Credit. Except as otherwise expressly provided in this Agreement or to the extent it would result in a duplication of
benefits, Baxalta and each Baxalta Benefit Plan shall, to the extent permitted in accordance with applicable Law, give each Transferred Employee credit for all service with the Baxter Group and shall calculate such service as it would be calculated
by Baxter or under the corresponding Baxter Benefit Plan as of the applicable Transfer Date. 
 Section 2.03 Establishment of
Baxalta Plans. 
 (a) Generally. 

(i) U.S. Prior to the Distribution Date, Baxalta shall adopt Benefit Plans (and related trusts, if applicable, as
determined by the Parties) with terms comparable in the aggregate to those of the corresponding Baxter Benefit Plans in the U.S., including in particular those listed in Schedule 2.03(a); provided, however, that Baxalta may
limit participation in any Baxalta Benefit Plan to Transferred Employees who participated in the corresponding Baxter Benefit Plan immediately prior to the applicable Transfer Date. 

(ii) Non-U.S. (excluding Puerto Rico). Prior to the Distribution Date, the Baxalta Group shall, except as otherwise
mutually agreed upon by the Parties, adopt Non-U.S. Baxalta Benefit Plans (excluding Non-U.S. Baxalta Benefit Plans with respect to Non-U.S. Baxalta Employees residing in Puerto Rico), with terms comparable in the aggregate to those of the
corresponding Non-U.S. Baxter Benefit Plans; provided, however, that Baxalta may limit participation in any such Non-U.S. Baxalta Benefit Plan to Non-U.S. Baxalta Employees who are Transferred Employees and who participated in the
corresponding Non-U.S. Baxter Benefit Plan immediately prior to the applicable Transfer Date. As described in Article IV, or as otherwise mutually agreed upon by the Parties from time to time, the Baxter Group shall, or shall cause the
applicable Non-U.S. Baxter Benefit Plan’s related trust to, transfer to the Baxalta Group or the relevant Non-U.S. Baxalta Benefit Plan’s related trust, an amount equal to the trust Assets, insurance reserves, and other Assets of each
Non-U.S. Baxter Benefit Plan relating to the Liabilities of such Non-U.S. Baxter Benefit Plan assumed by Baxalta or such Non-U.S. Baxalta Benefit Plan in accordance with this paragraph. To the extent a Non-U.S. Baxter Benefit Plan is not required to
be funded by applicable Law or is not voluntarily funded, there shall be no transfer of assets by the Non-U.S. Baxter Benefit Plan or by the Baxter Group. As described in Article IV, or as otherwise mutually agreed upon by the Parties
from time to time, the Baxalta Group shall, or shall cause the relevant Non-U.S. Baxalta Benefit Plan to, assume the Liabilities of the corresponding Non-U.S. 

  
 13 

 
Baxter Benefit Plan with respect to all benefits accrued under that Non-U.S. Baxter Benefit Plan by Non-U.S. Baxalta Employees (other than Non-U.S. Employees residing in Puerto Rico) who are
Transferred Employees. 
 (iii) Puerto Rico. Prior to the Distribution Date, the Baxalta Group shall, except as
otherwise provided in Article III or as mutually agreed upon by the Parties, adopt Non-U.S. Baxalta Benefit Plans with respect to Non-U.S. Baxalta Employees residing in Puerto Rico, with terms comparable in the aggregate to those of the
corresponding Non-U.S. Baxter Benefit Plans; provided, however, that Baxalta may limit participation in any such Non-U.S. Baxalta Benefit Plan to Non-U.S. Baxalta Employees who are Transferred Employees and who participated in the
corresponding Non-U.S. Baxter Benefit Plan immediately prior to the applicable Transfer Date; provided further that to the extent permitted by applicable Law, the Baxalta Group may provide for Non-U.S. Baxalta Employees residing in
Puerto Rico to participate in a Baxalta Benefit Plan maintained for Baxalta Employees residing in the United States, in which event such Baxalta Benefit Plan shall be considered a Non-U.S. Baxalta Benefit Plan with respect to the portion applicable
to such Non-U.S. Baxalta Employees. As described in Article III, or as otherwise mutually agreed upon by the Parties from time to time, the Baxter Group shall, or shall cause the applicable Non-U.S. Baxter Benefit Plan’s related trust
to, transfer to the Baxalta Group or the relevant Non-U.S. Baxalta Benefit Plan’s related trust, an amount equal to the trust Assets, insurance reserves, and other Assets of each Non-U.S. Baxter Benefit Plan relating to the Liabilities of such
Non-U.S. Baxter Benefit Plan assumed by Baxalta or such Non-U.S. Baxalta Benefit Plan in accordance with this paragraph. As described in Article III, or as otherwise mutually agreed upon by the Parties from time to time, the Baxalta Group
shall, or shall cause the relevant Non-U.S. Baxalta Benefit Plan to, assume the Liabilities of the corresponding Non-U.S. Baxter Benefit Plan with respect to all benefits accrued under that Non-U.S. Baxter Benefit Plan by Non-U.S. Baxalta Employees
residing in Puerto Rico who are Transferred Employees. 
 (b) Plan Information and Operation. Baxter shall provide Baxalta with
information describing each Baxter Benefit Plan election made by a Transferred Employee that may have application following the applicable Transfer Date. Baxalta shall determine, in its sole discretion, whether to administer the Baxalta Benefit
Plans using those elections or to require Transferred Employees to submit new elections with respect to the Baxalta Benefit Plans. Except as provided in this Agreement, the Distribution and the transfer of any Employee’s employment to the
Baxalta Group shall not cause a distribution from or payment of benefits under any Baxter Benefit Plan. Each Party shall, upon reasonable request, provide the other Party and the other Party’s respective Affiliates, agents, and vendors all
information reasonably necessary to the other Party’s operation or administration of its Benefit Plans. 
 Section 2.04
Non-Hire; Non-Solicit. 
 (a) As of the Distribution Date and until the second anniversary of the Distribution Date, Baxter shall
not, and shall cause the Baxter Group not to, solicit or hire or continue to keep employed (whether as an employee, consultant, contractor or otherwise) (i) any Baxalta Employee who was an Employee of the Baxter Group or Baxalta Group at any
time 

  
 14 

 
during the six months prior to the Distribution Date; or (ii) any Baxalta Employee who has rejected any offer of employment made by the Baxalta Group in connection with
Section 2.02(a)(i) (subject in each case to the terms of Section 2.02(a)(ii)); provided, however, that nothing in this Section 2.04(a) shall prohibit the Baxter Group from soliciting or hiring any
individual who is involuntarily terminated by the Baxalta Group, or from continuing to employ any Post-Distribution Baxalta Employee. 

(b) As of the Distribution Date and until the second anniversary of the Distribution Date, Baxalta shall not, and shall cause the Baxalta
Group not to, solicit or hire (whether as an employee, consultant, contractor or otherwise) (i) any Baxter Retained Employee or Baxter Former Employee who was an Employee of the Baxter Group or the Baxalta Group within six months prior to the
Distribution Date; or (ii) any Baxter Employee employed by the Baxalta Group who rejected any offer of employment made by the Baxter Group in connection with the Separation and Distribution; provided, however, that nothing in this
Section 2.04(b) shall prohibit the Baxalta Group from soliciting or hiring any individual who is involuntarily terminated by the Baxter Group, from continuing to employ any Baxter Employee as required by applicable Law, or from employing
any Baxter Employee (if any) whose transfer date to the Baxter Group by agreement of the Parties will occur after the Distribution Date. 

(c) The Parties specifically acknowledge and agree that this provision is necessary to ensure stabilization of both companies after the
Distribution and does not impede either company from competing in the marketplace or obtaining sufficient talent to effectively innovate, develop, grow, or sustain their respective businesses. 

(d) The Parties further specifically acknowledge and agree that any remedy at law for any breach of this Section 2.04 shall be
inadequate and that in the event of any actual or threatened breach of this Section 2.04, the non-breaching party, in addition to any other relief available to it, shall be entitled to temporary and permanent injunctive relief without
the necessity of proving actual damage. 
 (e) The Parties specifically acknowledge and agree that an exception may be made to this
provision at the sole discretion and with the written consent of the CVP and EVP, as applicable, of Human Resources of each Party. Any exception made shall not be used as precedent to compel or allow any further exceptions. 

Section 2.05 Post-Distribution Employment in Deferred Baxalta Local Businesses. The following provisions shall apply to the
Deferred Baxalta Local Businesses: 
 (a) During the period commencing on the Distribution Date and ending on the applicable Transfer Date,
Baxter or its appropriate Affiliate shall manage the employment of each Post-Distribution Baxalta Employee consistently with its management of the employment of similar Baxter Employees in the ordinary course of business (including with respect to
compensation, annual and other bonuses, and other compensation, subject to Section 2.05(a)(iii)(E) below); provided that Baxter and its Affiliates shall have no obligation to make any equity grant or provide any other equity
incentive to any Post-Distribution Baxalta Employee on or after the Distribution Date, and Baxalta shall have no obligation to Baxter or any of its Affiliates in respect of any equity grant or other equity incentive that is provided by Baxter

  
 15 

 
or its appropriate Affiliate to any Post-Distribution Baxalta Employee on or after the Distribution Date unless and except Baxter and Baxalta have agreed in writing otherwise. Baxalta shall be
responsible for all cash compensation liabilities arising during such period; provided that the payment and reimbursement for such amounts shall occur in accordance with the International Commercial Operations Agreement. Baxter shall until
the time of the applicable Local Closing Transaction (or such other Transfer Date with respect to any Post-Distribution Baxalta Employee): 

(i) provide Baxalta or its appropriate Affiliate with notice of (A) any material amendment to the Baxter Code of Conduct
to the extent applicable to the employment of a Post-Distribution Baxalta Employee or (B) the termination of any Post-Distribution Baxalta Employee due to a violation or potential violation of Law or the Baxter Code of Conduct, or otherwise
pursuant to Section 2.02(a)(ii); 
 (ii) provide Baxalta or its appropriate Affiliate with at least 30
days’ advance written notice prior to (A) making any material substantive change to the Employee Agreement of a Post-Distribution Baxalta Employee unless such change is required by applicable Law; (B) making any change to the base
salary of a Post-Distribution Baxalta Employee, other than an increase in the ordinary course of business (including any change required by Law or any contract existing as of the Distribution Date or otherwise approved by Baxalta) based on the
Employee’s performance rating or seniority; or (C) making any modification to a Baxter Benefit Plan in which a Post-Distribution Baxalta Employee participates if such modification would result in a significant change in the cost of such
plan to the employer or the participant; and 
 (iii) consult with and request a recommendation from Baxalta or its
appropriate Affiliate prior to (A) hiring any individual (other than in the ordinary course to replace any individual whose employment has terminated, in which case Baxter shall consult with Baxalta or its appropriate Affiliate prior to such
hiring) who will be classified as a Baxalta Employee unless such headcount addition was authorized prior to the Distribution Date, (B) terminating any Post-Distribution Baxalta Employee, except due to a violation of Law or the Baxter Code of
Conduct, or otherwise pursuant to Section 2.02(a)(ii), (C) promoting any Post-Distribution Baxalta Employee to a position of Vice President or higher unless such promotion was authorized prior to the Distribution Date,
(D) demoting any Post-Distribution Baxalta Employee, transferring any Post-Distribution Baxalta Employee to a location more than 20 miles from such Baxalta Employee’s current office location, or otherwise materially changing the role or
responsibility of any Post-Distribution Baxalta Employee or (E) establishing targets or goals for bonus and other incentive compensation awards granted to Post-Distribution Baxalta Employees by Baxter or any member of the Baxter Group. 

(b) Except as otherwise mutually agreed upon by the Parties (such as in a Conveyance and Assumption Instrument or other agreement), if a
Baxalta Employee’s transfer of employment to the Baxalta Group upon the consummation of a Local Closing Transaction or otherwise causes, at the time of such transfer, a forfeiture of awards granted prior to the Distribution Date under a Baxter
Stock Program (or successor thereto), Baxter shall not have any obligation, Liability or responsibility to such Baxalta Employee with respect to such 

  
 16 

 
forfeited awards, and Baxalta shall equitably compensate the affected Baxalta Employee for such forfeited awards in a manner determined by Baxalta in its sole discretion. The foregoing sentence
shall not preclude the Parties from making arrangements, if allowed by the Baxter Stock Program (or successor thereto) and applicable Law, to permit affected Baxalta Employees to continue to hold, after the Local Closing Transaction or other
Transfer Date, awards granted prior to the Distribution Date under a Baxter Stock Program (or successor thereto). 
 Section 2.06
Collective Bargaining. Baxalta shall cause the appropriate member of the Baxalta Group to assume all Liabilities arising under any collective bargaining agreement (including but not limited to any national, sector or local collective
bargaining agreement) with respect to any Transferred Employee. To the extent necessary, Baxalta shall cause the appropriate member of the Baxalta Group to join any industrial, employer or similar association or federation if membership is required
for the relevant collective bargaining agreement to continue to apply. 
 Section 2.07 Distributorship Model. In the
event that Baxalta operates any Deferred Baxalta Local Business through a local distributor rather than through an Affiliate, Baxalta agrees to use its best efforts to cause such local distributor to employ the Baxalta Employees on similar terms and
conditions of employment. 
 ARTICLE III 

U.S. AND PUERTO RICO QUALIFIED AND NON-QUALIFIED RETIREMENT PLANS 

Section 3.01 Baxalta Pension Plan. 

(a) Establishment of Baxalta Pension Plan. Effective on or about May 1, 2015, Baxalta shall establish the Baxalta Pension Plan
(such effective date, the “Pension Split Date”), which shall be substantially similar to, and which shall include benefit formulas that are the same as the benefit formulas in effect under, the Baxter Pension Plan as of the Pension
Split Date. As soon as practicable after the Pension Split Date and upon receipt by Baxter of (i) a copy of the Baxalta Pension Plan; (ii) copies of certified resolutions of the Baxalta Board (or its authorized committee or other delegate)
evidencing adoption of the Baxalta Pension Plan and any related trust(s) and the assumption by the Baxalta Pension Plan of the Liabilities described in Section 3.01(b); and (iii) either (A) a favorable determination letter
issued by the Internal Revenue Service with respect to the Baxalta Pension Plan and any related trust, or (B) an opinion of counsel, which counsel and opinion are reasonably satisfactory to Baxter, with respect to the qualified status of the
Baxalta Pension Plan under Code Section 401(a) and the tax-exempt status of any related trust under Code Section 501(a) (which opinion of counsel may assume that Baxalta will make a timely application for a determination letter and adopt
any amendments required by the Internal Revenue Service as a condition to receipt of such letter), Baxter shall direct the trustee of the trust described in the Baxter International Inc. and Subsidiaries Pension Trust Agreement to make the transfer
of Assets described in Section 3.01(b). 

  
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 (b) ERISA Section 4044 Transfer. 

(i) As of the Pension Split Date, Baxalta shall cause the Baxalta Pension Plan to accept all Assets and assume all Liabilities
under the Baxter Pension Plan for Transferred Employees (other than Post-Distribution Baxalta Employees) (including Assets and Liabilities in respect of beneficiaries and alternate payees) and the Baxter Pension Plan shall transfer all such Assets
and be relieved of such Liabilities; provided that, if any such Assets or Liabilities are transferred to the Baxalta Pension Plan on or prior to the Distribution Date in respect of any participant who does not become a Transferred Employee as
of the Distribution Date, Baxter and Baxalta shall cause such Assets and Liabilities to be promptly returned to (and assumed by) the Baxter Pension Plan (effective as of the Distribution Date), with Assets and Liabilities in respect of employees who
are not Transferred Employees as of the Distribution Date to be transferred to the Baxalta Pension Plan only to the extent set forth in Section 3.01(b)(ii). The amount of Assets to be transferred from the Baxter Pension Plan to the
Baxalta Pension Plan in such transfer (or transfers) shall be determined as of the Pension Split Date in accordance with, and shall comply with, Code Section 414(l) and, to the extent deemed applicable by the Parties, ERISA Section 4044.
Assumptions used to determine the value (or amount) of the Assets to be transferred shall be the safe harbor assumptions specified for valuing benefits in trusteed plans under Department of Labor Regulations Section 4044.51-57 and, to the
extent not so specified, shall be based on the assumptions used in the annual valuation report most recently prepared prior to the transfer by the actuary for the Baxter Pension Plan. The transfer amount described above shall be credited or debited,
to the extent applicable, with a pro rata share of the actual investment earnings or losses allocable to the transfer amount for the period between the Pension Split Date (or such earlier transfer date) and an assessment date set by Baxter that is
as close as practicable, taking into account the timing and reporting of valuation of assets in the trust or trusts described in the Baxter International Inc. and Subsidiaries Pension Trust Agreement, to the date upon which Assets equal in value to
the transfer amount are actually transferred from the Baxter Pension Plan to the Baxalta Pension Plan. The ultimate transfer amount shall be credited or debited by the actual investment earnings or losses from the payment date to the assessment date
set by Baxter above. In addition, during this period, Baxalta will be responsible for a pro rata share of trustee and administration fees attributable to the Baxalta Pension Plan assets that remain in the Baxter Pension Plan. The funding balances
and shortfall amortization installments shall be divided among the Baxter Pension Plan and the Baxalta Pension Plan based on the guidance provided in Revenue Ruling 81-212 and 86-47. 

(ii) As indicated in Section 3.01(b)(i), the Parties anticipate that the Baxalta Pension Plan accept Assets and
assume all Liabilities under the Baxter Pension Plan for Transferred Employees on or prior to the Distribution Date. Notwithstanding such transfer and assumption on or prior to the Distribution Date, the Parties acknowledge and agree that
adjustments (including of the type described in Section 3.01(b)(i)) may be necessary after the Distribution Date to finalize the intent of Section 3.01(b)(i). Any such adjustments (including the transfer and assumption of
Assets and Liabilities in respect thereof) will, unless the Parties have determined that the amount is significant enough to require earlier discussion, be made on or about December 31, 2015. The amount of such Assets to be transferred shall be
determined as provided in Section 3.01(b)(i) and shall be subject to the applicable provisions of Section 3.01(b)(i). 

  
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 (iii) If a participant in the Baxter Pension Plan who is scheduled to become a
Transferred Employee terminates employment after the Pension Split Date, but before such participant’s Transfer Date, such participant’s benefit will be paid entirely by the Baxter Pension Plan (and shall include any compensation paid and
service earned after the Pension Split Date) and, to the extent such benefit was taken into account in determining the amount of Assets transferred to the Baxalta Pension Plan, an appropriate adjustment shall be made. If a Transferred Employee
terminates from the Baxalta Group after such Transferred Employee’s Transfer Date, but before the transfer of Assets is completed, such Transferred Employee’s benefit may initially be paid by the Baxter Pension Plan, but shall be paid by
the Baxalta Pension Plan after the Asset transfer is completed, with any payment made by the Baxter Pension Plan in accordance with this sentence credited against the amount transferred to the Baxalta Pension Plan. 

(iv) Periodically, at such times as agreed upon by the Parties after the initial transfer described in
Section 3.01(b)(i), Baxalta shall cause the Baxalta Pension Plan to receive Assets and assume all Liabilities under the Baxter Pension Plan with respect to Post-Distribution Baxalta Employees who become Transferred Employees (including
Assets and Liabilities in respect of beneficiaries and/or alternate payees) and the Baxter Pension Plan shall transfer all such Assets and be relieved of such Liabilities. The amount of such Assets to be transferred shall be determined as provided
in Section 3.01(b)(i). 
 (c) Baxalta Pension Plan Provisions. The Baxalta Pension Plan shall provide that: 

(i) Transferred Employees shall (A) be eligible to participate in the Baxalta Pension Plan as of the Pension Split Date,
or as of the applicable Transfer Date with respect to Post-Distribution Baxalta Employees (in either case, the “Pension Eligibility Date”) to the extent they were eligible to participate in the Baxter Pension Plan as of the Pension
Eligibility Date, and (B) receive credit for vesting, eligibility and benefit service for all service credited for those purposes under the Baxter Pension Plan as of the Pension Eligibility Date as if that service had been rendered to Baxalta;

 (ii) the compensation paid by the Baxter Group to a Transferred Employee that is recognized under the Baxter Pension Plan
as of the Pension Eligibility Date shall be credited and recognized for all applicable purposes under the Baxalta Pension Plan as though it were compensation from the Baxalta Group; 

(iii) the accrued benefit of each Transferred Employee under the Baxter Pension Plan as of the applicable Pension Eligibility
Date shall be payable under the Baxalta Pension Plan at the time and in a form that would have been permitted under the Baxter Pension Plan as in effect as of the applicable Pension Eligibility Date, with employment by the Baxter Group prior to the
applicable Pension Eligibility Date treated as employment by the Baxalta Group under the Baxalta Pension Plan for purposes of determining eligibility for optional forms of benefit, early retirement benefits, or other benefit forms; provided
that nothing herein shall preclude Baxalta from changing the forms of benefit available under the Baxalta Pension Plan to the extent permitted by Code Section 411(d)(6); 

  
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 (iv) the Baxalta Pension Plan shall assume and honor the terms of all QDROs in
effect under the Baxter Pension Plan as of the Pension Eligibility Date with respect to Transferred Employees; and 
 (v)
the Baxalta Pension Plan shall provide the additional benefit accruals, if any, required by USERRA for a Former Employee who is employed by the Baxalta Group following the Distribution Date pursuant to Section 2.02(a)(i)(C), including
any amount that relates to the period of military leave that occurred prior to the Distribution Date. 
 (d) Determination Letter
Request. Baxalta shall submit an application to the Internal Revenue Service and the Puerto Rico Department of the Treasury either prior to, or as soon as practicable after, the Pension Split Date (but no later than the last day of the remedial
amendment period as defined in applicable Code provisions) for a determination letter regarding the qualification of the Baxalta Pension Plan and the tax status of its related trust as of the Pension Split Date and shall make any amendments
reasonably requested by the Internal Revenue Service to receive a favorable determination letter regarding the Baxalta Pension Plan. 
 (e)
Baxter Pension Plan after Distribution Date. From and after the Pension Split Date, (i) the Baxter Pension Plan shall continue to be responsible for Liabilities in respect of Employees other than Transferred Employees (and for
Post-Distribution Baxalta Employees until their respective Transfer Dates), and (ii) no Employees of the Baxalta Group (other than Post-Distribution Baxalta Employees until their respective Transfer Dates) shall accrue any benefits under the
Baxter Pension Plan. Without limiting the generality of the foregoing, Transferred Employees shall cease to be active participants in the Baxter Pension Plan effective as of the applicable Pension Eligibility Date. 

(f) Plan Fiduciaries. Prior to the Distribution Date, Baxter’s Administrative Committee and the Investment Committee shall act as
the fiduciaries for the Baxalta Pension Plan as necessary. For all periods after the Distribution Date, the Parties agree that the applicable fiduciaries of each of the Baxter Pension Plan and the Baxalta Pension Plan, respectively, shall have the
authority with respect to the Baxter Pension Plan and the Baxalta Pension Plan, respectively, to determine the plan investments and such other matters as are within the scope of their duties under ERISA Section 404. 

(g) No Loss of Unvested Benefits; No Distributions. The transfer of any Transferred Employee’s employment to the Baxalta Group
will not result in loss of that Transferred Employee’s unvested benefits under the Baxter Pension Plan or the Baxalta Pension Plan and no Transferred Employee shall be entitled to a distribution of his or her benefit under the Baxter Pension
Plan as a result of such transfer of employment. 
 (h) Puerto Rico Employees. Transferred Employees who are participants in the
Baxter Healthcare of Puerto Rico Pension Plan (the “Baxter Puerto Rico Pension Plan”) will have their benefits transferred to the Baxalta Pension Plan as of the Pension 

  
 20 

 
Split Date such that Assets transferred to the Baxalta Pension Plan will equal the present value of accrued benefits using reasonable actuarial assumptions. The terms of the Baxalta Pension Plan
will include terms providing that the benefits of such Transferred Employees will be determined in accordance with the terms of the Baxter Puerto Rico Pension Plan to the extent such terms differ from those of the Baxter Pension Plan, except as
otherwise required by applicable Law. 
 Section 3.02 Incentive Investment Plan. 

(a) Establishment of Baxalta Incentive Investment Plan. Effective as of or before the Distribution Date, Baxalta shall establish the
Baxalta IIP. As of the Distribution Date, the terms of the Baxalta IIP shall be substantially similar to the terms of the Baxter IIP as of the Distribution Date; provided that the investment options may be different under the Baxalta IIP. On
or prior to the Distribution Date, Baxalta shall provide Baxter with (i) a copy of the Baxalta IIP; (ii) a copy of certified resolutions of the Baxalta Board (or its authorized committee or other delegate) evidencing adoption of the
Baxalta IIP and the related trust(s) and the assumption by the Baxalta IIP of the Liabilities described in Section 3.02(b); and (iii) either (A) a favorable determination letter issued by the Internal Revenue Service with
respect to the Baxalta IIP and its related trust or (B) an opinion of counsel, which counsel and opinion are reasonably satisfactory to Baxter, with respect to the qualified status of the Baxalta IIP under Code Section 401(a) and the
tax-exempt status of its related trust under Code Section 501(a) (which opinion of counsel may assume that Baxalta will make a timely application for a determination letter and adopt any amendments required by the Internal Revenue Service as a
condition to receipt of such letter). 
 (b) Transfer of Account Balances. As soon as practicable after the Distribution Date,
Baxter shall cause the trustee of the Baxter IIP to transfer from the trust(s) which forms a part of the Baxter IIP to the trust(s) which forms a part of the Baxalta IIP amounts equal to the account balances of the Transferred Employees (including
account balances in respect of beneficiaries and alternate payees established in relation to such individuals) under the Baxter IIP, determined as of the date of the transfer. Such transfers shall be made in cash, Baxter Common Shares, shares of
Baxalta Common Stock, promissory notes evidencing outstanding loans and other Assets (including common shares of Edwards Lifesciences or Cardinal Health, Inc.) or any combination thereof in cash or in kind, as instructed by the Baxter IIP or the
investment committee thereof. Baxalta shall cause the transferred amounts to be allocated among the Transferred Employees’ (and beneficiaries’ and/or alternate payees’, as applicable) Baxalta IIP accounts and to be allocated to the
same investment funds as the accounts were allocated under the Baxter IIP to the extent that such investment funds are available under the Baxalta IIP and, to the extent such investment funds are not available, in the manner determined by the
fiduciaries of the Baxalta IIP. Any Asset and Liability transfers pursuant to this Section 3.02 shall comply in all respects with Code Sections 414(l) and 411(d)(6). 

(c) Baxalta Incentive Investment Plan Provisions. The Baxalta IIP shall provide that: 

(i) Transferred Employees shall (A) be eligible to participate in the Baxalta IIP as of the applicable Transfer Date to
the extent they were eligible to participate in the Baxter IIP as of the applicable Transfer Date, and (B) receive credit for vesting purposes for all service credited for that purpose under the Baxter IIP as of the applicable Transfer Date as
if that service had been rendered to Baxalta; 

  
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 (ii) the account balance of each Transferred Employee under the Baxter IIP as of
the date of the transfer of Assets from the Baxter IIP (including any outstanding promissory notes) shall be credited to such individual’s account balance under the Baxalta IIP; 

(iii) the Baxalta IIP shall assume and honor the terms of all QDROs in effect under the Baxter IIP as of the Transfer Date
with respect to Transferred Employees; 
 (iv) Baxalta shall contribute to the Baxalta IIP on behalf of each Transferred
Employee an amount equal to any Matching Contributions, as defined in the Baxter IIP, that relate to Elective Deferrals made by such Transferred Employee prior to the Transfer Date, and who is not entitled to have 2015, or any portion thereof,
treated as a year of service for purposes of determining such Transferred Employee’s accrued benefit as defined in either the Baxter Pension Plan, the Baxter Puerto Rico Pension Plan, or the Baxalta Pension Plan, but that were not made to the
Baxter IIP prior to the Transfer Date due to limitations under the Baxter IIP on the maximum amount of Matching Contributions made in any payroll period; 

(v) Baxalta shall contribute to the Baxalta IIP on behalf of each Transferred Employee who is employed on the last day of 2015
(or whose employment is terminated from the Baxalta Group by reason of death or disability following the applicable Transfer Date) an Employer Non-Matching Contribution (as such term is used in the Baxter IIP) calculated as provided in
Section 5.8 of the Baxter IIP, based upon the Transferred Employee’s total compensation for the Baxter Group and the Baxalta Group during 2015; and 

(vi) the Baxalta IIP shall provide the opportunity to make up Elective Deferrals, and any employer contributions, required by
USERRA for a Former Employee who is employed by the Baxalta Group following the Distribution Date pursuant to Section 2.02(a)(i)(C), including any amount that relates to the period of military leave that occurred prior to the
Distribution Date. 
 (d) Determination Letter Request. Baxalta shall submit an application to the Internal Revenue Service either
prior to, or as soon as practicable following, the Distribution Date (but no later than the last day of the remedial amendment period as defined in applicable Code provisions) for a determination regarding the qualification of the Baxalta IIP and
the tax-exempt status of its related trust as of the Distribution Date and shall make any amendments reasonably requested by the Internal Revenue Service to receive a favorable determination letter regarding the Baxalta IIP. 

(e) Baxter Incentive Investment Plan after Distribution Date. From and after the Distribution Date, (i) the Baxter IIP shall
continue to be responsible for Liabilities in respect of Baxter Retained Employees, Former Employees and (until the applicable Transfer 

  
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Date) Post-Distribution Baxalta Employees, and (ii) no Employees of the Baxalta Group (other than Post-Distribution Baxalta Employees until their respective Transfer Dates), shall accrue any
benefits under the Baxter IIP. Without limiting the generality of the foregoing, Transferred Employees shall cease to be active participants in the Baxter IIP effective as of the applicable Transfer Date. 

(f) Plan Fiduciaries and Stock Considerations. Prior to the Distribution Date, Baxter’s Administrative Committee and Investment
Committee shall act as the fiduciaries for the Baxalta IIP as necessary. Without limiting the generality of the foregoing, the Baxter Investment Committee shall determine the initial investment funds available under the Baxalta IIP, and Baxter shall
provide all Transferred Employees with all blackout notices, and comply with all other requirements necessary to transfer the accounts of participants in the Baxter IIP to the Baxalta IIP. For all periods after the Distribution Date, the Parties
agree that the applicable fiduciaries of each of the Baxter IIP and the Baxalta IIP, respectively, shall have the authority with respect to the Baxter IIP and the Baxalta IIP, respectively, to determine the investment alternatives, the terms and
conditions with respect to those investment alternatives and such other matters as are within the scope of their duties under ERISA Section 404. 

(g) No Loss of Unvested Benefits; No Distributions. The transfer of any Transferred Employee’s employment to the Baxalta Group
will not result in loss of that Transferred Employee’s unvested benefits under the Baxter IIP or the Baxalta IIP Plan and no Transferred Employee shall be entitled to a distribution of his or her benefit under the Baxter IIP as a result of such
transfer of employment. 
 (h) Puerto Rico Employees. Effective as of or before the Distribution Date, Baxalta shall establish a
defined contribution plan qualified under the Puerto Rico Internal Revenue Code for a new Puerto Rico (the “Baxalta SIP”). As of the Distribution Date, the terms of the Baxalta SIP shall be substantially similar to the terms of the
Baxter Healthcare of Puerto Rico Savings and Investment Plan (the “Baxter SIP”) as of the Distribution Date (except as described in Section 3.02(f), including the existence of different investment options). Transferred
Employees who are participants in the Baxter SIP shall have their accounts in the Baxter SIP fully vested as of the Transfer Date, and shall thereafter be treated as terminated vested participants for all purposes of the Baxter SIP. Such
participants shall be eligible to participate in the Baxalta SIP to the extent they were eligible to participate in the Baxter SIP as of the applicable Transfer Date, and receive credit for vesting purposes for all service credited for that purpose
under the Baxter SIP as of the applicable Transfer Date as if that service had been rendered to Baxalta. The provisions of Section 3.02(c) shall also apply to the Baxalta SIP, as applicable. 

Section 3.03 Supplemental Pension Plan 

(a) Establishment of Baxalta SERP. Effective as of or before the Pension Split Date, Baxalta shall establish the Baxalta SERP, with
terms and funding arrangements substantially similar to those of the Baxter SERP as of the Pension Split Date. 
 (b) Assumption of SERP
Liabilities and Transfer from Baxter SERP. Except as provided below, as of a Transferred Employee’s Pension Eligibility Date, Baxalta 

  
 23 

 
shall, and shall cause the Baxalta SERP to, assume all Liabilities for all obligations under the Baxter SERP for the benefits of such individual (and any other individual on whose behalf
Liabilities are transferred from the Baxter Pension Plan to the Baxalta Pension Plan under Section 3.01(b)(ii)) and his or her beneficiaries and/or alternate payees determined as of the applicable Transfer Date, and Baxter and the Baxter
SERP shall be relieved of all Liabilities for those benefits. 
 (c) Baxalta SERP Provisions. As of the Pension Split Date, the
Baxalta SERP shall provide that: 
 (i) Transferred Employees shall (A) be eligible to participate in the Baxalta SERP
to the extent they were eligible to participate in the Baxter SERP as of the applicable Pension Eligibility Date, and (B) receive credit for vesting, eligibility and benefit service for all service credited for those purposes under the Baxter
SERP as of the Pension Eligibility Date as if that service had been rendered to Baxalta (provided that in the event that any such Transferred Employee receives a distribution from the Baxter SERP, the value of such distribution shall be offset
against future benefits under the Baxalta SERP to the extent necessary to avoid a duplication of benefits, the terms of such offset to be set forth in the Baxalta SERP); 

(ii) the compensation paid by the Baxter Group to a Transferred Employee that was recognized under the Baxter SERP as of the
Pension Eligibility Date shall be credited and recognized for all applicable purposes under the Baxalta SERP as though it were compensation from the Baxalta Group; 

(iii) the accrued benefit of each Transferred Employee under the Baxter SERP as of the applicable Pension Eligibility Date
shall be payable under the Baxalta SERP at the same time and in the same form that would have been paid under the Baxter SERP, treating such Transferred Employee’s separation from service from the Baxalta Group as if it were a separation from
service from the Baxter Group, taking into account any election made by the Transferred Employee relating to the time and form of his or her payment under the Baxter SERP; provided, however, that if a participant in the Baxter Pension
Plan who is scheduled to become a Transferred Employee terminates employment after the Pension Split Date, but before such participant’s Transfer Date, and the Pension Plan benefit of such participant is transferred back to the Baxter Pension
Plan pursuant to Section 3.01(b)(iii), the accrued benefit of such participant shall be paid exclusively by the Baxter SERP and shall be calculated as if such participant had been employed continuously by the Baxter Group through such
participant’s date of termination; 
 (iv) the Baxalta SERP shall assume and honor the terms of all arrangements
relating to beneficiaries in effect and honored under the Baxter SERP as of the applicable Transfer Date with respect to Transferred Employees; and 

(v) the Baxalta SERP shall provide the additional benefit accruals, if any, required by USERRA for a Former Employee who is
employed by the Baxalta Group following the Distribution Date pursuant to Section 2.02(a)(i)(C), including any amount that relates to the period of military leave that occurred prior to the Distribution Date. 

  
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 (d) Baxter SERP after Transfer Date. From and after a Transferred Employee’s Pension
Eligibility Date, such Transferred Employee shall not participate in or accrue any benefits under the Baxter SERP. Without limiting the generality of the foregoing, each Transferred Employee shall cease to participate in the Baxter SERP effective as
of the applicable Pension Eligibility Date, except as otherwise provided in Section 3.03(c)(iii). The Baxter SERP shall continue to be responsible for Liabilities in respect of Baxter Retained Employees, Former Employees and (until the
applicable Transfer Date) Post-Distribution Baxalta Employees and their beneficiaries. To the maximum extent permitted by Treasury Regulations Section 1.409A-1(h)(4), a Transferred Employee shall not be considered to have undergone a
“separation from service” for purposes of Code Section 409A and the Baxter SERP solely by reason of the Separation, and, following his or her Transfer Date, the determination of whether a Transferred Employee has incurred a separation
from service with respect to his or her benefit in the Baxalta SERP shall be based solely upon his performance of services for the Baxalta Group. 

Section 3.04 Deferred Compensation Plan. 

(a) Establishment of Baxalta DCP. Effective as of or before the Distribution Date, Baxalta shall establish the Baxalta DCP, with terms
comparable in the aggregate to those of the Baxter DCP as of the Distribution Date; provided that the investment options thereunder may be different than those available under the Baxter DCP. 

(b) Assumption of DCP Liabilities and Transfer from Baxter DCP. 

(i) As of a Transferred Employee’s Transfer Date, Baxalta shall, and shall cause the Baxalta DCP to, assume all
Liabilities for all obligations under the Baxter DCP for the benefits of such individual and his or her beneficiaries, determined as of the applicable Transfer Date, and Baxter and the Baxter DCP shall be relieved of all Liabilities for those
benefits. 
 (ii) As of or as soon as practicable after the applicable Transfer Date, the Parties shall cooperate to cause
the accounts of the applicable Transferred Employee participating in the Baxter DCP to be transferred to the Baxalta DCP. Baxalta shall (A) credit each such Transferred Employee’s account with (1) the amount deferred by such
individual into the Baxter DCP as of the applicable Transfer Date, plus (2) any employer contributions, whether vested or unvested, deemed to have been made in relation to the amount described in (1), including, in each case, any earnings
thereon, and (B) recognize and honor all deferral and distribution elections made by such individual (including any deferral election applicable to any bonus earned but not yet paid as of the applicable Transfer Date). 

(iii) The accrued benefit of each Transferred Employee under the Baxter DCP as of the applicable Transfer Date shall be
payable under the Baxalta DCP at the same time and in the same form that would have been paid under the Baxter 

  
 25 

 
DCP, treating such Transferred Employee’s separation from service from the Baxalta Group as if it were a separation from service from the Baxter Group, taking into account any election made
by the Transferred Employee relating to the time and form of his or her payment under the Baxter DCP. 
 (iv) Baxalta shall
credit to the account of each Transferred Employee in the Baxalta DCP who was a participant in the Baxter DCP immediately prior to the Transfer Date an amount equal to the Excess Matching Contributions and Employer Non-Matching Contributions (in
each case as defined in the Baxter DCP), to which such Transferred Employee would have been entitled had such Transferred Employee been employed by the Baxter Group throughout 2015, reduced by the amount of Excess Matching Contributions and Employer
Non-Matching Contributions credited to such Transferred Employee’s account in the Baxter DCP, and shall also make up any contributions required by USERRA for a Former Employee who is employed by the Baxalta Group following the Distribution Date
pursuant to Section 2.02(a)(i)(C), including any amount that relates to the period of military leave that occurred prior to the Distribution Date. 

(c) Baxter DCP after Transfer Date. From and after a Transferred Employee’s Transfer Date, such individual shall not participate
in or accrue any benefits under the Baxter DCP. Without limiting the generality of the foregoing, each Transferred Employee shall cease to participate in the Baxter DCP effective as of his or her Transfer Date. The Baxter DCP shall continue to be
responsible for Liabilities in respect of Baxter Retained Employees, Former Employees and (until the applicable Transfer Date) Post-Distribution Baxalta Employees and their beneficiaries. To the maximum extent permitted by Treasury Regulations
Section 1.409A-1(h)(4), a Transferred Employee shall not be considered to have undergone a “separation from service” for purposes of Code Section 409A and the Baxter DCP solely by reason of the Separation, and, following his
Transfer Date, the determination of whether a Transferred Employee has incurred a separation from service with respect to his or her benefit in the Baxalta DCP shall be based solely upon his or her performance of services for the Baxalta Group. 

ARTICLE IV 
 NON-U.S.
RETIREMENT PLANS 
 Section 4.01 Establishment of Non-U.S. Retirement Plans and Transfers of Assets and Liabilities.
Except as mutually agreed upon by the Parties or required under this Article IV, effective as of or before the Distribution Date, Baxalta or its appropriate Affiliate will establish pension and retirement plans (whether defined contribution or
defined benefit pension plans) with terms that are reasonably comparable to those of the corresponding Non-U.S. Baxter Benefit Plan. For purposes of this Article IV, the term Non-U.S. Baxter Benefit Plan shall not include the Baxter Puerto
Rico Pension Plan or the Baxter SIP. 
 (a) Transfer of Non-U.S. Retirement Plan Assets and Liabilities. As soon as practicable
prior to, on or after the Distribution Date, except as otherwise provided in this Agreement, the Assets and Liabilities determined as of the date of the applicable local closing occurring prior to, on or after the Distribution Date (such date, the
“Applicable Closing  

  
 26 

 
Date”) under the corresponding Non-U.S. Baxter Benefit Plan attributable to Transferred Non-U.S. Employees (and, with respect to each of the countries or entities listed in
Schedule 4.01(a), Former Employees) who are participants in that plan, along with any other Assets and Liabilities that Baxalta agrees to assume with respect to such plan, shall be transferred to the applicable Non-U.S. Baxalta Benefit Plan.
The Non-U.S. Baxter Benefit Plan shall retain all Assets and Liabilities related to Baxter Retained Employees, Former Employees (other than Former Employees in the countries or of the entities listed in Schedule 4.01(a)) and Post-Distribution
Baxalta Employees (subject to Section 4.01(c)), and with respect to all countries and entities set forth in Schedule 4.02(a) in accordance with Section 4.02(a). Assets will be allocated between the plans based on the
proportion of Liabilities borne by each plan. Except as otherwise mutually agreed upon by the Parties, such Liabilities will be valued using the projected benefit obligation based on plan provisions as in effect at the Applicable Closing Date and
applying demographic and other assumptions used in the most recently completed valuation of the applicable Non-U.S. Baxter Benefit Plan (and taking into account the requirements of ASC 715 as it exists as of the Applicable Closing Date);
provided, however, that all economic assumptions will be updated as of the Applicable Closing Date. The transfer amount described above shall be credited or debited, as applicable, with a pro rata share of the actual investment
earnings or losses allocable to the transfer amount for the period between the Applicable Closing Date and an assessment date set by Baxter that is as close as practicable, taking into account the timing and reporting of valuation of the applicable
Non-U.S. Baxter Benefit Plan’s Assets, to the date upon which Assets equal in value to the transfer amount are actually transferred from the applicable Non-U.S. Baxter Benefit Plan to the applicable Non-U.S. Baxalta Benefit Plan;
provided that, if actual investment earnings or losses are not then determinable, Baxter and Baxalta shall then agree on a reasonable alternative methodology (which may include expected or estimated returns used for other similar purposes by
Baxter in the ordinary course of business). During this period, benefits payable to Transferred Non-U.S. Employees (and, with respect to those countries or entities listed in Schedule 4.01(a), Former Employees) shall be paid from the Non-U.S.
Baxter Benefit Plan. Except as otherwise mutually agreed upon by the Parties, the ultimate transfer amount shall be reduced by the amount of these benefits and credited or debited by the actual investment earnings or losses from the payment date to
the assessment date set by Baxter above. Any third party fees, costs or expenses incurred under the applicable Non-U.S. Baxter Benefit Plan during the period from the Applicable Closing Date to the assessment date set by Baxter shall be shared by
the Parties based on the proportion of Liabilities borne by the applicable Non-U.S. Baxter Benefit Plan and the applicable Non-U.S. Baxalta Benefit Plan. The Parties agree to use commercially reasonable efforts to accomplish each transfer as soon as
practicable on or following the Applicable Closing Date and to cooperate with each other to make such filings and disclosures and obtain such approvals as may be deemed necessary or advisable in accordance with applicable Law. Notwithstanding the
foregoing, to the extent a Non-U.S. Baxter Benefit Plan is not required to be funded by applicable Law or is not voluntarily funded, there shall be no transfer of Assets by the Non-U.S. Baxter Benefit Plan or by the Baxter Group in respect thereof.

 (b) Non-U.S. Baxalta Retirement Plan Provisions. Each Non-U.S. Baxalta Benefit Plan shall provide, except as otherwise provided
in this Agreement or local Conveyance and Assumption Instruments that: 
 (i) Transferred Non-U.S. Employees (and, with
respect to each of the countries or entities listed in Schedule 4.01(a), Former Employees) shall (A) be 

  
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eligible to participate in the Non-U.S. Baxalta Benefit Plan to the extent they were eligible to participate in the corresponding Non-U.S. Baxter Benefit Plan, and (B) receive credit for
vesting, eligibility and benefit service to the same extent recognized by Baxter as of immediately prior to the Transfer Date for all service credited for those purposes under the corresponding Non-U.S. Baxter Benefit Plan as if that service had
been rendered to Baxalta; 
 (ii) the compensation paid by the Baxter Group to a Transferred Non-U.S. Employee (or, with
respect to each of the countries or entities listed in Schedule 4.01(a), a Former Employee) that is recognized under the Non-U.S. Baxter Benefit Plan shall be credited and recognized for all applicable purposes under the corresponding
Non-U.S. Baxalta Benefit Plan as though it were compensation from the Baxalta Group; and 
 (iii) the accrued benefit of
each Transferred Non-U.S. Employee (or, with respect to each of the countries or entities listed in Schedule 4.01(a), each Former Employee) under the Non-U.S. Baxter Benefit Plan that is transferred to the corresponding Non-U.S. Baxalta
Benefit Plan pursuant to Section 4.01(a) shall be paid under such Non-U.S. Baxalta Benefit Plan in accordance with the terms of such Non-U.S. Baxalta Benefit Plan and applicable Law, with employment by the Baxter Group treated as
employment by the Baxalta Group under the Non-U.S. Baxalta Benefit Plan for purposes of determining eligibility for optional forms of benefit, early retirement benefits, or other benefit forms. 

(c) Subsequent Transfers. Periodically, at such times as agreed upon by the Parties after the initial transfer described in
Section 4.01(a), Baxalta shall cause the applicable Non-U.S. Baxalta Benefit Plan to receive Assets and assume all Liabilities under the applicable Non-U.S. Baxter Benefit Plan for Post-Distribution Baxalta Employees who become
Transferred Employees (including Assets and Liabilities in respect of beneficiaries and/or alternate payees) and the applicable Non-U.S. Baxter Benefit Plan shall transfer all such Assets and be relieved of such Liabilities. The amount of such
Assets to be transferred shall be determined as provided in Section 4.01(a) (and shall include any employee contributions made by such Post-Distribution Baxalta Employee between the Distribution Date and the applicable Transfer Date) and
shall be subject to the applicable provisions of Section 4.01(a). 
 (d) Notwithstanding the foregoing, if pension benefits are
funded by individually linked insurance contracts, such contracts in respect of Transferred Employees shall be assigned to Baxalta or its applicable Subsidiary in lieu of the transfers of (and calculations of value with respect to) other Assets
otherwise contemplated hereby. 
 Section 4.02 Shared Plan Model. 

(a) Baxalta Participation in Non-U.S. Baxter Retirement Plans. 

(i) In each of the countries or entities listed in Schedule 4.02(a), Baxter or its appropriate Affiliate will permit
Baxalta or its appropriate Affiliate to continue to participate in the Non-U.S. Baxter Benefit Plan providing retirement 

  
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benefits in that country after the Distribution. Except as otherwise mutually agreed upon by the Parties, such continued participation is subject to the following requirements: (A) Baxter or
its appropriate Affiliate will remain the principal employer under the plan; (B) the applicable Baxter pension fund (or such other party or parties have such amendment rights under the terms of the applicable plan, if any) may amend the plan at
any time; (C) any third party fees, costs or expenses shall be shared by the Parties on the basis of their proportionate share of the insured salaries under the Non-U.S. Baxter Benefit Plan; (D) Baxter shall determine the benefit formula
or structure under the plan (which shall apply uniformly to all similarly situated participants); and (E) such continued participation may not extend beyond two years after the Distribution Date, unless otherwise mutually agreed by each
Party’s CVP or EVP, as applicable, of Human Resources (or such individual’s delegate). 
 (ii) At or before the
end of the shared plan period, in each of the countries or entities listed in Schedule 4.02(a), Baxalta or its appropriate Affiliate shall establish its own plan or arrangement to deliver the benefits due to Baxalta Employees (and, with
respect to each of the countries or entities marked with an asterisk in Schedule 4.02(a), Former Employees) under the applicable Non-U.S. Baxter Benefit Plan or otherwise shall be responsible for all costs incurred by the Parties in
connection with winding up or terminating the participation of Baxalta or its appropriate Affiliate in the Non-U.S. Baxter Benefit Plan. Following the establishment of the Non-U.S. Baxalta Benefit Plan, the Assets and Liabilities of the Non-U.S.
Baxter Benefit Plan attributable to Baxalta Employees (and, with respect to each of the countries or entities marked with an asterisk in Schedule 4.02(a), Former Employees) who are participants in that plan shall be transferred to the
applicable Non-U.S. Baxalta Benefit Plan. Assets will be allocated between the plans based on the proportion of Liabilities borne by each plan. Except as otherwise mutually agreed upon by the Parties, such Liabilities will be valued as of the Shared
Plan Replacement Date using the projected unit credit method based on plan provisions as in effect at the Shared Plan Replacement Date and applying the demographic and other assumptions used in the most recently completed valuation of the applicable
Non-U.S. Baxter Benefit Plan (and taking into account the requirements of ASC 715 as it exists as of the Shared Plan Replacement Date); provided, however, that all economic assumptions will be updated as of the Shared Plan Replacement
Date. The transfer amount described above shall be credited or debited, as applicable, with a pro rata share of the actual investment earnings or losses allocable to the transfer amount for the period between the Shared Plan Replacement Date and an
assessment date set by Baxter that is as close as practicable, taking into account the timing and reporting of valuation of the applicable Non-U.S. Baxter Benefit Plan’s Assets, to the date upon which Assets equal in value to the transfer
amount are actually transferred from the applicable Non-U.S. Baxter Benefit Plan to the applicable Non-U.S. Baxalta Benefit Plan; provided that, if actual investment earnings or losses are not then determinable, Baxter and Baxalta shall then
agree on a reasonable alternative methodology (which may include expected or estimated returns used for other similar purposes by Baxter in the ordinary course of business). During this period, benefits payable to Baxalta Employees (and, with
respect to each of the countries or entities marked with an asterisk in Schedule 4.02(a), Former Employees) shall be paid from the Non-U.S. Baxter Benefit Plan. Except as otherwise mutually agreed upon by the Parties, the ultimate transfer
amount shall be 

  
 29 

 
reduced by the amount of these benefits and credited or debited by the actual investment earnings or losses from the payment date to the assessment date set by Baxter above. Any third party fees,
costs or expenses incurred under the applicable Non-U.S. Baxter Benefit Plan during the period from the Shared Plan Replacement Date to the assessment date set by Baxter shall be shared by the Parties on the basis of their proportionate share of the
insured salaries under the Non-U.S. Baxter Benefit Plan. The Parties agree to use commercially reasonable efforts to accomplish each transfer as soon as practicable following the Shared Plan Replacement Date and to cooperate with each other to make
such filings and disclosures and obtain such approvals as may be deemed necessary or advisable in accordance with applicable Law. Such transfers and any actuarial assumptions shall be subject to such minimum consents, approvals and other legal
requirements as may apply under applicable Law, including, if required, the consent of any affected plan participant or any other third party. Notwithstanding the foregoing, to the extent a Non-U.S. Baxter Benefit Plan is not required to be funded
by applicable Law or is not voluntarily funded, there shall be no transfer of Assets by the Non-U.S. Baxter Benefit Plan or by the Baxter Group in respect thereof. 

(b) Non-U.S. Baxter Retirement Plan Provisions. Each Non-U.S. Baxter Benefit Plan described in Section 4.02(a) shall
provide, except as otherwise provided in this Agreement, that: 
 (i) Baxalta Employees (and, with respect to each of the
countries or entities marked with an asterisk in Schedule 4.02(a), Former Employees) shall (A) be eligible to participate in the Non-U.S. Baxter Benefit Plan to the extent they were eligible to participate in such plan immediately prior
to the Distribution Date, and (B) receive credit for vesting, eligibility and benefit service for all service with the Baxalta Group during the shared plan period as if that service had been rendered to Baxter; 

(ii) the compensation paid by the Baxalta Group to a Baxalta Employee (and, with respect to each of the countries or entities
marked with an asterisk in Schedule 4.02(a), a Former Employee) during the shared plan period shall be credited and recognized for all applicable purposes under the corresponding Non-U.S. Baxter Benefit Plan as though it were compensation
from the Baxter Group; and 
 (iii) the accrued benefit of each Baxalta Employee (and, with respect to each of the countries
or entities marked with an asterisk in Schedule 4.02(a), Former Employee) under the Non-U.S. Baxter Benefit Plan shall be paid at the time and in a form provided under such plan, with employment by the Baxalta Group during the shared plan
period treated as employment by the Baxter Group under the Non-U.S. Baxter Benefit Plan for purposes of determining eligibility for optional forms of benefit, early retirement benefits, or other benefit forms. 

(c) Subsequent Transfers. Periodically, at such times as agreed upon by the Parties after the initial transfer described in
Section 4.02(a), Baxalta shall cause the applicable Non-U.S. Baxalta Benefit Plan to receive Assets and assume all Liabilities under the applicable Non-U.S. Baxter Benefit Plan for Post-Distribution Baxalta Employees (and, with

  
 30 

 
respect to each of the countries or entities marked with an asterisk in Schedule 4.02(a), Former Employees) who become Transferred Employees (including Assets and Liabilities in respect of
beneficiaries and/or alternate payees) and the applicable Non-U.S. Baxter Benefit Plan shall transfer all such Assets and be relieved of such Liabilities. The amount of such Assets to be transferred shall be determined as provided in
Section 4.02(a) (and shall include any employee contributions made by such Post-Distribution Baxalta Employee between the Distribution Date and the applicable Transfer Date) and shall be subject to the applicable provisions of
Section 4.02(a). 
 ARTICLE V 

WELFARE AND FRINGE BENEFIT PLANS 

Section 5.01 Health and Welfare Plans. 

(a) Establishment of Baxalta Health and Welfare Plans. Effective as of or before the Distribution Date, Baxalta shall establish the
Baxalta Health and Welfare Plans, with terms comparable in the aggregate to those of the corresponding Baxter Health and Welfare Plans as of the Distribution Date unless otherwise provided in this Article V. 

(b) Waiver of Conditions; Benefit Maximums. Baxalta shall, to the extent commercially reasonable and permitted under applicable Law
and, with respect to Non-U.S. Health and Welfare Plans, to the extent applicable, cause the Baxalta Health and Welfare Plans to: 

(i) with respect to initial enrollment (whether passive or active) prior to, as of or following the applicable Transfer Date,
waive: 
 (A) all limitations as to preexisting conditions, exclusions, and service conditions with respect to
participation and coverage requirements applicable to any Transferred Employee, other than limitations that were in effect with respect to the Transferred Employee under the applicable Baxter Health and Welfare Plan as of immediately prior to such
individual’s Transfer Date, and 
 (B) any waiting period limitation or evidence of insurability requirement
applicable to a Transferred Employee other than limitations or requirements that were in effect with respect to such Transferred Employee under the applicable Baxter Health and Welfare Plan as of immediately prior to such individual’s Transfer
Date; and 
 (ii) take into account: 

(A) with respect to aggregate annual, lifetime, or similar maximum benefits available under the Baxalta Health and Welfare
Plans, a Transferred Employee’s prior claim experience under the Baxter Health and Welfare Plans and any Benefit Plan that provides leave benefits; and 

  
 31 

 (B) any eligible expenses incurred by a Transferred Employee and his or her
covered dependents during the portion of the plan year of the applicable Baxter Health and Welfare Plan ending on the applicable Transfer Date to be taken into account under such Baxalta Health and Welfare Plan for purposes of satisfying all
deductible, coinsurance, and maximum out-of-pocket requirements applicable to such Transferred Employee and his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such Baxalta Health and
Welfare Plan. 
 (c) Allocation of Health and Welfare Assets and Liabilities. 

(i) General Principles. Notwithstanding any other provision hereof and except as otherwise agreed between the Parties,
(A) Baxter shall retain all Liabilities relating to Incurred Claims of Baxter Retained Employees and Former Employees under the Baxter Health and Welfare Plans, and shall also retain Assets (including, without limitation, Medicare
reimbursements, pharmaceutical rebates, and similar items) associated with such Incurred Claims and (B) Baxalta shall be responsible for Incurred Claims of Baxalta Employees from and after the applicable Transfer Date. Baxalta shall be
responsible for all Liabilities relating to Incurred Claims under any Baxalta Health and Welfare Plan and shall also retain Assets (including, without limitation, Medicare reimbursements, pharmaceutical rebates, and similar items) associated with
such Incurred Claims. 
 (ii) Disability Benefits. Notwithstanding any other provision hereof and except as otherwise
agreed between the Parties, (A) Baxter shall be responsible for Incurred Claims (including ongoing benefit payments) of Baxter Retained Employees and Former Employees for short- and long-term disability benefits, regardless of when the
applicable Incurred Claim was incurred and (B) subject to the immediately following sentence, Baxalta shall be responsible for Incurred Claims (including ongoing benefit payments) of Baxalta Employees from and after the applicable Transfer Date
for short-term disability benefits and long-term disability benefits. Notwithstanding the foregoing, a Baxalta Employee who is on short-term disability leave on the Transfer Date and who subsequently qualifies for long-term disability without an
intervening new Incurred Claim shall receive long-term disability benefits from the Baxter long-term disability plan, but all other benefits attributable to his or her disability (including continued pension accrual, if applicable, and participation
in any medical or life insurance plan for disabled persons) shall be provided by the applicable Baxalta Benefit Plan, if any, or otherwise be the responsibility of Baxalta, and if Baxalta does not sponsor a plan providing any such benefits, such
Baxalta Employee shall not be entitled to such benefits from any Baxter Benefit Plan. 
 (iii) Flexible Spending
Accounts. Except as set forth on Schedule 5.01(c)(iii), the Parties shall take all actions necessary to ensure that, effective as of the Distribution Date (or, if later, the Transfer Date applicable to a Post-Distribution Baxalta
Employee), (A) the health care and dependent care flexible spending accounts of Transferred Employees (whether positive or negative) (the “Transferred Flexible  

  
 32 

 
Spending Account Balances”) under the applicable Baxter Health and Welfare Plan shall be transferred to the corresponding Baxalta Health and Welfare Plan; (B) the elections,
contribution levels and coverage of the applicable Transferred Employees shall apply under the Baxalta Health and Welfare Plan in the same manner as under the corresponding Baxter Health and Welfare Plan; and (C) the applicable Transferred
Employees shall be eligible for reimbursement from the Baxalta Health and Welfare Plan on the same basis and the same terms and conditions as under the corresponding Baxter Health and Welfare Plan. As soon as practicable after the Distribution Date,
and in any event within 30 business days after the amount of the Transferred Flexible Spending Account Balances is determined, Baxter shall pay Baxalta the net aggregate amount of the Transferred Flexible Spending Account Balances, if such amount is
positive, and Baxalta shall pay Baxter the net aggregate amount of the Transferred Flexible Spending Account Balances, if such amount is negative. 

(d) Retiree Health Care Plan and Retiree Life Insurance. Notwithstanding any other provision hereof (or any other action taken by
Baxter and Baxalta on or prior to the Distribution Date, including any assignment and assumption of Assets or Liabilities related thereto), Baxter shall retain the Liabilities and responsibility for all obligations under the Baxter Retiree Health
Care Plan and the Baxter Health and Welfare Plan (solely with respect to life insurance benefits in the case of the Baxter Health and Welfare Plan) for benefits due to Baxter Retained Employees and Former Employees, and shall also retain Assets,
including, without limitation, Medicare reimbursements, pharmaceutical rebates, and similar items, associated with such benefits. Effective as of or before the Distribution Date, Baxalta shall establish a health care plan for retirees, with terms
comparable in the aggregate to the Baxter International Inc. Welfare Plan for Retirees and Disabled Individuals, provided that the Baxalta Plan shall not be required to provide any benefits previously provided by the Baxter International Inc. and
Subsidiaries Medical and Dental Plan for Disabled Individuals prior to its merger into the Baxter International Inc. Welfare Plan for Retirees and Disabled Individuals. 

(e) Baxter Health and Welfare Plans after Distribution Date. Transferred Employees shall cease to participate in the Baxter Health and
Welfare Plans effective as of their respective Transfer Dates. 
 (f) Shared Health and Welfare Plans. To the extent that, following
the Distribution Date, there is any Non-U.S. Health and Welfare Plan pursuant to which health and welfare benefits are provided to Employees of both the Baxter Group and the Baxalta Group, the Parties or their appropriate Affiliates shall share the
costs for such shared plan, except as otherwise mutually agreed upon by the Parties. Any Baxter Affiliate or Baxalta Affiliate may withdraw from or otherwise cease to participate in any such shared plan following the Distribution Date upon at least
90 days’ advance written notice to the other participating employer(s) of such withdrawal or cessation. 
 (g) Multi-National
Pooling Arrangements. For purposes of this provision, the term “multi-national pooling arrangement” means a contract or arrangement that facilitates the purchase or provision of employee benefits. Baxter shall retain all Assets
(including, without limitation, rights to dividends and similar items) with respect to employee benefits-related pooling contracts to which any member of the Baxter Group is a party or under 

  
 33 

 
which any member of the Baxter Group pays the premiums. From and after the Distribution Date, Baxalta shall retain all Assets (including, without limitation, rights to dividends and similar
items) with respect to employee benefits-related pooling contracts to which any member of the Baxalta Group is a party or under which any member of the Baxalta Group pays the premiums. 

(h) Life Insurance Premium Reserve Refund. The Parties acknowledge and agree that a cash payment in respect of surplus life insurance
premiums paid prior to the Distribution Date is expected to be received by the Baxter Group in late 2015 or early 2016. Promptly following the Baxter Group’s receipt of any such amounts, Baxter shall notify Baxalta of the amount of such payment
attributable to employee-paid premiums with respect to Transferred Employees and shall promptly pay such amounts to the account or accounts directed by Baxalta and Baxalta shall use such amounts for the benefit of the applicable employees (whether
through a premium holiday, reduced premiums or otherwise). 
 Section 5.02 COBRA and HIPAA. Baxter shall continue to be
responsible for compliance with the health care continuation requirements of COBRA, the certificate of creditable coverage requirements of HIPAA, and the corresponding provisions of the Baxter Health and Welfare Plans with respect to any
(a) Baxter Retained Employees and any Former Employees (and their covered dependents) who incur a qualifying event under COBRA on, prior to, or following the Distribution Date, (b) Baxalta Employees who do not at any time become
Transferred Employees (and their covered dependents) who incur a qualifying event under COBRA on, prior to, or following the Distribution Date, and (c) other Baxalta Employees (and their covered dependents), with respect to qualifying events
under COBRA incurred prior to or on the applicable Transfer Date. Baxalta shall assume responsibility for compliance with the health care continuation requirements of COBRA, the certificate of creditable coverage requirements of HIPAA, and the
corresponding provisions of the Baxalta Health and Welfare Plans with respect to any Transferred Employees (and their covered dependents) who incur a qualifying event or loss of coverage under the Baxalta Health and Welfare Plans after their
respective Transfer Dates. The Parties agree that the consummation of the transactions contemplated by the Separation and Distribution Agreement shall not constitute a COBRA qualifying event for any purpose of COBRA. 

Section 5.03 Vacation, Holidays and Leaves of Absence. Effective as of the applicable Transfer Date in accordance with
Section 2.01(a)(i), Baxalta shall be responsible for any and all Liabilities to, or relating to, Transferred Employees in respect of vacation, holiday, personal days, sick days, annual leave or other leave of absence, and required
payments related thereto. Baxter shall retain all Liabilities with respect to vacation, holiday, annual leave or other leave of absence, and required payments related thereto, for each Baxter Retained Employee and Former Employee, as well as Baxalta
Employees until the applicable Transfer Date of such Baxalta Employees. 
 Section 5.04 Severance and Unemployment
Compensation. Effective as of the applicable Transfer Date, Baxalta shall be responsible for any and all Liabilities to, or relating to, Transferred Employees in respect of severance and unemployment compensation. Subject to any specific
agreement to the contrary in the Separation and Distribution Agreement or any Ancillary Agreement and subject to Section 2.02(a)(ii), Baxter shall be responsible for any and all Liabilities to, or relating to, Baxter Retained Employees
and Former Employees, as 

  
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well as Baxalta Employees until an applicable Transfer Date occurs with respect to such Baxalta Employees, in respect of severance and unemployment compensation, regardless of whether the event
giving rise to the Liability occurred prior to, on, or following the Distribution Date. In the event that an employee receiving severance pay under the Baxter severance plan is hired by Baxalta or an employee receiving severance pay under the
Baxalta severance plan is hired by Baxter, the remaining severance payable to the employee under the terms of the Baxter severance plan (or the Baxalta severance plan, as applicable), if any, shall (to the extent Baxter is, or would be upon such
hiring, processing Baxalta’s payroll with respect to such employee at such time) be paid in a single lump sum to the extent permitted by Code Section 409A and, if not so permitted, shall be forfeited. 

Section 5.05 Workers’ Compensation. Except as required by applicable Law or as otherwise determined jointly by the
Parties as a result of the requirements of any Governmental Authority, all United States workers’ compensation Liabilities relating to, arising out of, or resulting from any claim (a) by Employees designated internally as working for or
assigned to the BioScience or BioLife commercial units, to the extent such claim was incurred prior to May 1, 2015, shall be assumed, or retained as the case may be, by Baxalta as of the Transfer Date or (b) incurred on or after
May 1, 2015 shall be assumed, or retained as the case may be, by the Party (or its applicable Subsidiary) that employed such Employee as of the time of such claim. The Baxter Group shall be responsible for all Liabilities relating to, arising
out of, or resulting from any United States workers’ compensation claims incurred prior to May 1, 2015 unless expressly specified otherwise in the immediately preceding sentence or as required by applicable Law. Each member of the Baxalta
Group and the Baxter Group shall cooperate with respect to any notification to appropriate governmental agencies of the disposition and the issuance of new, or the transfer of existing, workers’ compensation insurance policies and claims
handling contracts. 
 ARTICLE VI 

EQUITY, INCENTIVE, AND DIRECTOR AND EXECUTIVE COMPENSATION PROGRAMS 

Section 6.01 Equity Incentive Programs. 

(a) Options, PSUs and RSUs. The Parties shall use commercially reasonable efforts to take all actions necessary or appropriate so that
each outstanding Baxter Option, Baxter PSU Award, or Baxter RSU Award granted under a Baxter Stock Program shall be adjusted or converted as set forth in this Section 6.01. This Section 6.01(a) shall not apply to grants
(including those Baxter RSU Awards deferred pursuant to the Baxter Directors’ DCP) made under the Baxter Directors’ Plan (or any successor or predecessor plan), and the sole provisions with respect to the adjustment and conversion of those
grants are set forth in Section 6.04. 
 (i) Baxter Options. As determined by the Baxter Compensation
Committee pursuant to its authority under the applicable Baxter Stock Program, each Baxter Option granted prior to January 1, 2015 (other than new hire grants made on or after July 1, 2014) that remains outstanding as of immediately prior
to the 

  
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Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the Distribution Date into both an Adjusted Baxter Option and a
Baxalta Option. As determined by the Baxter Compensation Committee pursuant to its authority under the applicable Baxter Stock Program, each Baxter Option granted on or after January 1, 2015 (or, with respect to new hire grants, on or after
July 1, 2014), but prior to the Distribution Date that remains outstanding as of immediately prior to the Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the
Distribution Date into (x) an Adjusted Baxter Option in the case of Baxter Employees and Baxter Former Employees or (y) a Baxalta Option in the case of Baxalta Employees or Baxalta Former Employees. Each such adjusted or converted Option
shall, except as otherwise provided in this Section 6.01, be subject to the same terms and conditions (including with respect to vesting) after the Distribution Date as applicable to such Baxter Option immediately prior to the
Distribution Date; provided, however, that upon such adjustment or conversion: 
 (A) with respect to each
Baxter Option granted prior to January 1, 2015 (other than new hire grants made on or after July 1, 2014), the number of Baxter Common Shares subject to such Option shall be unchanged from the number of Baxter Common Shares that were
subject to the original unadjusted Baxter Option; 
 (B) with respect to each Baxter Option granted prior to January 1,
2015 (other than new hire grants made on or after July 1, 2014), the number of shares of Baxalta Common Stock subject to the Baxalta Option issued with respect to such Option, rounded down to the nearest whole share, shall be equal to the
product obtained by multiplying (1) the number of Baxter Common Shares subject to the Baxter Option immediately prior to the Distribution Date times (2) the Distribution Ratio; 

(C) with respect to each Baxter Option granted on or after January 1, 2015 (or, with respect to new hire grants, on or
after July 1, 2014), the number of Baxter Common Shares subject to such Adjusted Baxter Option (if any), rounded down to the nearest whole number, shall be equal to (1) the number of Baxter Common Shares subject to the Baxter Option
immediately prior to the Distribution Date, divided by (2) the Baxter Percentage; 
 (D) with respect to each Baxter
Option granted on or after January 1, 2015 (or, with respect to new hire grants, on or after July 1, 2014), the number of shares of Baxalta Common Stock subject to the Baxalta Option into which such Baxter Option is converted (if any),
rounded down to the nearest whole number, shall be equal to (1) the product obtained by multiplying (xx) the number of Baxter Common Shares subject to the Baxter Option immediately prior to the Distribution Date times (yy) the Distribution
Ratio, divided by (2) the Baxalta Percentage; 

  
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 (E) the per share exercise price of each Adjusted Baxter Option, rounded up to
the nearest hundredth of a cent, shall be equal to (1) the Baxter Pre-Distribution Stock Value minus (2) the Baxter Pre-Distribution Option Value; and 

(F) the per share exercise price of each Baxalta Option, rounded up to the nearest hundredth of a cent, shall be equal to
(1) the Baxalta Stock Value minus (2) the Baxalta Pre-Distribution Option Value; 
 provided, however, that the exercise price, the
number of Baxter Common Shares and shares of Baxalta Common Stock subject to such options, and the terms and conditions of exercise of such options shall be determined in a manner consistent with the requirements of Code Section 409A;
provided, further, that, in the case of any Baxter Option to which Code Section 421 applies by reason of its qualification under Code Section 422 as of immediately prior to the Distribution Date, the exercise price, the
number of Baxter Common Shares and shares of Baxalta Common Stock subject to such option, and the terms and conditions of exercise of such option shall be determined in a manner consistent with the requirements of Code Section 424(a). 

(ii) Baxter PSU Awards. As determined by the Baxter Compensation Committee pursuant to its authority under the
applicable Baxter Stock Program, prior to the Distribution Date, Baxter shall, notwithstanding the existing terms of such awards, cause such Baxter Awards to be equitably adjusted. Each Baxter PSU Award granted prior to January 1, 2015
that remains outstanding as of immediately prior to the Distribution Date shall be converted (regardless of by whom held, and whether or not vested or unvested) into (A) a number of Baxter Awards equal to the number of Baxter Common Shares
payable in respect of such Baxter Award and (B) a number of Baxalta Awards equal to the product obtained by multiplying (1) the number of Baxter Common Shares payable in respect of such Baxter PSU Award times (2) the Distribution
Ratio, in each case as determined by Baxter’s Compensation Committee. The Baxter Awards and Baxalta Awards received upon conversion of Baxter PSU Awards in accordance with this Section 6.01(a)(ii) both shall be subject to
substantially the same terms and conditions (including with respect to vesting) immediately following the Distribution Date as applicable immediately prior to the Distribution Date for those Baxter Awards from which such Baxter Awards and Baxalta
Awards were converted. 
 (iii) Baxter RSU Awards. Each holder of Baxter RSU Awards granted prior to January 1,
2015 (other than new hire grants made on or after July 1, 2014) that remain outstanding as of immediately prior to the Distribution Date, regardless of by whom held, whether vested or unvested, shall receive (in addition to retaining such
Baxter RSU Awards) concurrently with the Distribution on the Distribution Date a number of Baxalta RSU Awards equal to the product obtained by multiplying (x) the number of such Baxter RSU Awards held by such holder times (y) the
Distribution Ratio. Each Baxter RSU Award granted on or after January 1, 2015 (or, with respect to new hire grants, on or after July 1, 2014) but prior to the Distribution Date that remains outstanding as of immediately prior to the
Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the Distribution Date into (A) an Adjusted Baxter RSU Award in the case of Baxter

  
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Employees and Baxter Former Employees or (B) a Baxalta RSU Award in the case of Baxalta Employees or Baxalta Former Employees. Except as set forth in this Section 6.01(a)(iii),
all Adjusted Baxter RSU Awards and Baxalta RSU Awards issued in accordance with this Section 6.01(a)(iii) shall be subject to substantially the same terms and conditions (including with respect to vesting) immediately following the
Distribution Date as applicable immediately prior to the Distribution Date for those Baxter RSU Awards from which such Adjusted Baxter RSU Awards and Baxalta RSU Awards were converted; provided, however, that with respect to each
Baxter RSU Award granted on or after January 1, 2015 (or, with respect to new hire grants, on or after July 1, 2014): 

(A) the number of units represented by an Adjusted Baxter RSU Award shall be equal to (1) the number of units subject to
the Baxter RSU Award immediately prior to the Distribution Date, divided by (2) the Baxter Percentage; 
 (B) the
number of units represented by a Baxalta RSU Award shall be equal to (1) the product obtained by multiplying (xx) the number of units subject to the Baxter RSU Award immediately prior to the Distribution Date times (yy) the Distribution
Ratio, divided by (2) the Baxalta Percentage. 
 (iv) Notwithstanding the foregoing, the Parties may mutually agree not
to adjust (or to otherwise adjust as they deem appropriate) certain outstanding Baxter equity-based awards pursuant to the foregoing provisions of this Section 6.01 to the extent such actions would create or trigger adverse legal,
accounting or tax consequences or in order to comply with any Employee Agreement or similar agreement with any affected Employee. 
 (b)
Miscellaneous Award Terms. After the Distribution Date, Adjusted Baxter Awards, regardless of by whom held, shall be settled by Baxter, and Baxalta Awards, regardless of by whom held, shall be settled by Baxalta. Except as otherwise provided
in this Agreement, with respect to grants described in this Section 6.01, (i) no Transferred Employee shall be treated as having incurred a termination of employment with respect to any Baxter Award solely by reason of the transfer
of employment, (ii) employment with the Baxter Group shall be treated as employment with Baxalta with respect to Baxalta Awards held by Baxter Retained Employees, and (iii) employment with the Baxalta Group shall be treated as employment
with Baxter with respect to Adjusted Baxter Awards held by Baxalta Employees. In addition, neither the Separation nor the Distribution (including, for the avoidance of doubt, any Local Closing Transaction) shall constitute a termination of
employment for any Employee for purposes of any Adjusted Baxter Award or any Baxalta Award. Following the Distribution Date, for any award adjusted or otherwise received in accordance with this Section 6.01, any reference to a
“change in control,” “change of control” or similar definition in an award agreement, employment agreement or Baxter Stock Program applicable to such award (A) with respect to Adjusted Baxter Awards, shall be deemed to refer
to a “change in control,” “change of control” or similar definition as set forth in the applicable award agreement, employment agreement or Baxter Stock Program (a “Baxter Change of Control”), and (B) with
respect to Baxalta Awards, shall be deemed to refer to a “change in control,” “change of control” or similar definition as 

  
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defined in the Baxalta Equity Plan (a “Baxalta Change of Control”). Without limiting the foregoing, with respect to provisions related to vesting of awards, a Baxter Change of
Control shall be treated as a Baxalta Change of Control for purposes of Baxalta Awards held by Baxter Retained Employees or Baxter Former Employees, and a Baxalta Change of Control shall be treated as a Baxter Change of Control for purposes of
Adjusted Baxter Awards held by Baxalta Employees or Baxalta Former Employees. The Distribution shall not, in and of itself, be treated as either a Baxter Change of Control or a Baxalta Change of Control 

(c) Tax Reporting and Withholding. Following the Distribution Date, it is generally expected that (i) Baxter will be responsible
for all income, payroll and other tax remittance and reporting related to income of Baxter Retained Employees, Baxter Former Employees, and individuals who continue to be Baxter non-employee directors immediately following the Distribution Date in
respect of Adjusted Baxter Awards and Baxalta Awards; and (ii) Baxalta will be responsible for all income, payroll and other tax remittance and reporting related to income of Transferred Employees, Baxalta Former Employees and Baxalta
non-employee directors who do not continue to be Baxter non-employee directors immediately following the Distribution Date in respect of Adjusted Baxter Awards and Baxalta Awards. Baxter or Baxalta, as applicable, shall facilitate performance by the
other Party of its obligations hereunder by promptly remitting amounts or shares withheld in conjunction with a transfer of shares or cash, either (as mutually agreed by the Parties) directly to the applicable taxing authority or to the other Party
for remittance to such taxing authority. The Parties will cooperate and communicate with each other and with third-party providers to effectuate withholding and remittance of taxes, as well as required tax reporting, in a timely, efficient and
appropriate manner. Baxter and Baxalta shall, to the extent practicable, (x) treat Baxalta (or a member of the Baxalta Group designated by Baxter) as a “successor employer” and Baxter (or the appropriate member of the Baxter Group) as
a “predecessor,” within the meaning of Sections 3121(a)(1) and 3306(b)(1) of the Code, with respect to Baxalta Employees (upon the Transfer Date for such Baxalta Employee) for purposes of taxes imposed under the United States Federal
Unemployment Tax Act or the United States Federal Insurance Contributions Act, and (y) cooperate with each other to avoid, to the extent possible, the filing of more than one IRS Form W-2 with respect to each Baxalta Employee for the year in
which the Transfer Date for such Baxalta Employee occurs. The obligations to cooperate and support the other in respect of such tax withholding and remittance shall not continue beyond the termination or expiration of such or similar transition
services under the Transition Services Agreement. 
 (d) Registration and Other Regulatory Requirements. As soon as possible
following (or prior to) the Distribution Date, but in any case before the date of issuance of any shares of Baxalta Common Stock pursuant to the Baxalta Equity Plan, Baxalta agrees to file a Form S-8 Registration Statement (or such other
registration statement as may be permitted in lieu thereof if a Form S-8 Registration Statement is not then available for any such awards to be granted in accordance with the terms of this Agreement) with respect to, and to cause to be registered
pursuant to the Securities Act, the shares of Baxalta Common Stock authorized for issuance under the Baxalta Equity Plan as required pursuant to the Securities Act. The Parties shall take such additional actions as are deemed necessary or advisable
to effectuate the foregoing provisions of this Section 6.01, including compliance with securities Laws and other legal requirements associated with equity compensation awards in affected non-U.S. jurisdictions. Baxter agrees to
facilitate the adoption and approval of the Baxalta Equity Plan consistent with the requirements of Treasury Regulations Section 1.162-27(f)(4)(iii). 

  
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 (e) Baxter Equity-Based Awards in Certain Non-U.S. Jurisdictions. Notwithstanding the
foregoing provisions of this Section 6.01, the Parties may mutually agree, in their sole discretion (including as set forth in Schedule 6.01(e)), not to adjust certain outstanding Baxter equity-based awards pursuant to the
foregoing provisions of this Section 6.01, where those actions would create or trigger adverse legal, accounting or tax consequences for Baxter, Baxalta, and/or the affected non-U.S. award holders. In such circumstances, Baxter and/or
Baxalta may take any action necessary or advisable to prevent any such adverse legal, accounting or tax consequences, including, but not limited to, agreeing that the outstanding Baxter equity-based awards of the affected non-U.S. award holders
shall terminate in accordance with the terms of the Baxter Stock Programs and the underlying award agreements, in which case Baxalta or Baxter, as applicable, shall equitably compensate the affected non-U.S. award holders in an alternate manner
determined by Baxalta or Baxter, as applicable, in its sole discretion, or apply an alternate adjustment method. Where and to the extent required by applicable Law or tax considerations outside the United States, the adjustments described in this
Section 6.01 shall be deemed to have been effectuated immediately prior to the Distribution Date. 
 Section 6.02
Employee Stock Purchase Plan. 
 (a) Baxter ESPP. The administrator of the Baxter ESPP shall take all actions necessary
and appropriate to provide that: (i) the final purchases to be made thereunder by Baxalta Employees may, subject to clause (iv), occur (and reasonable time is provided to allow such purchases to occur) on or before the applicable Transfer Date
to allow such participants to purchase Baxter Common Shares under the Baxter ESPP on or prior to such Transfer Date; (ii) all participant payroll deductions and other contributions under the Baxter ESPP by Baxalta Employees shall cease on or
before the final purchases by such Baxalta Employees pursuant to in clause (i) of this paragraph; (iii) subject to clause (iv), Baxalta Employees in the Baxter ESPP shall not be eligible to make any future purchases or participate in any
future Offerings (as defined in the Baxter ESPP) following the applicable Transfer Date; and (iv) any cash remaining in the Baxter ESPP account of any Baxalta Employee described in clause (iii) shall either be used to make purchases of
Baxter Common Shares under the Baxter ESPP as of the next regularly scheduled purchase date under the Baxter ESPP or, to the extent required under applicable local Law, refunded to such Baxalta Employee. For purposes of this paragraph, the
administrator of the Baxter ESPP may establish an alternate Offering End Date (as defined in the Baxter ESPP) for a sub-plan of the Baxter ESPP, as it determines to be necessary or advisable to accommodate the operation and administration of the
sub-plan. 
 (b) Establishment of Baxalta ESPP. Effective as of or before the Distribution Date, Baxalta shall establish the Baxalta
ESPP, with terms substantially similar to those of the Baxter ESPP as of the Distribution Date; provided, however, that Baxalta may delay implementation of the Baxalta ESPP or otherwise choose not to establish such Baxalta ESPP in one
or more countries (i) to the extent necessary to complete those actions and undertakings that Baxalta, in its sole discretion, determines to be necessary or advisable to comply with applicable Law or (ii) if Baxalta determines, in its sole
discretion, that establishing and maintaining such Baxalta ESPP in such country would not be commercially reasonable in light of the facts and circumstances. 

  
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 Section 6.03 Annual Bonus. The Baxalta Group shall be responsible for all
annual bonus payments or other forms of cash incentive compensation (including commissions) to Transferred Employees (and Post-Distribution Baxalta Employees as part of the costs and expenses passed through to Baxalta pursuant to the International
Commercial Operations Agreement) in respect of any plan year, the payment date for which occurs on or after the applicable Transferred Employee’s Transfer Date. Notwithstanding the foregoing, the Parties intend to treat the portion of 2015
ending on the Distribution Date as a separate performance period for purposes of 2015 annual bonuses. The bonuses attributable to such separate performance period earned by Transferred Employees shall be paid by Baxalta at substantially the same
time such bonuses are paid to Baxter Retained Employees, and to the extent that payment is conditioned upon continued employment, employment by the Baxalta Group shall be treated as employment by the Baxter Group. 

Section 6.04 Directors’ Plan. Effective as of or before the Distribution Date, Baxalta shall establish the Baxalta
Directors’ Plan, with terms and funding arrangements substantially similar to those of the Baxter Directors’ Plan as of the Distribution Date. The Parties shall use commercially reasonable efforts to take all actions necessary or
appropriate so that each outstanding Baxter Option or Baxter RSU Award granted under the Baxter Directors’ Plan shall be adjusted or converted as set forth in this Section 6.04. For the avoidance of doubt, the remainder of this
Section 6.04 applies only to grants (including those Baxter RSU Awards deferred pursuant to the Baxter Directors’ DCP) made under the Baxter Directors’ Plan (or any successor or predecessor plan), while Section 6.01
is intended to apply to other programs included within the Baxter Stock Programs. 
 (a) Baxter Options. As determined by the Baxter
Compensation Committee pursuant to its authority under the Baxter Directors’ Plan, each Baxter Option granted prior to January 1, 2015 (other than new hire grants made on or after July 1, 2014) that remains outstanding as of
immediately prior to the Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the Distribution Date into both an Adjusted Baxter Option and a Baxalta Option. As
determined by the Baxter Compensation Committee pursuant to its authority under the Baxter Directors’ Plan, each Baxter Option granted on or after January 1, 2015 (or, with respect to new hire grants, on or after July 1, 2014) but
prior to the Distribution Date that remains outstanding as of immediately prior to the Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the Distribution Date into
(i) an Adjusted Baxter Option in the case of any holder thereof who, as of immediately following the Distribution Date, is not serving on the Baxalta Board or who is serving on both the Baxter Board and the Baxalta Board or (ii) a Baxalta
Option in the case of any holder thereof who, as of immediately following the Distribution Date, is serving on the Baxalta Board, but not the Baxter Board. Each such adjusted or converted Option shall, except as otherwise provided in this
Section 6.04(a), be subject to the same terms and conditions (including with respect to vesting) after the Distribution Date as applicable to such Baxter Option immediately prior to the Distribution Date; provided, however,
that upon such adjustment or conversion: 
 (A) with respect to each Baxter Option granted prior to January 1, 2015
(other than new hire grants made on or after July 1, 2014), the number of Baxter Common Shares subject to such Option shall be unchanged from the number of Baxter Common Shares that were subject to the original unadjusted Baxter Option; 

  
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 (B) with respect to each Baxter Option granted prior to January 1, 2015
(other than new hire grants made on or after July 1, 2014), the number of shares of Baxalta Common Stock subject to the Baxalta Option into which such Baxter Option is converted, rounded down to the nearest whole share, shall be equal to the
product obtained by multiplying (x) the number of Baxter Common Shares subject to the Baxter Option immediately prior to the Distribution Date times (y) the Distribution Ratio; 

(C) with respect to each Baxter Option granted on or after January 1, 2015 (or, with respect to new hire grants, on or
after July 1, 2014) to any holder thereof who, as of immediately following the Distribution Date, is not serving on the Baxalta Board or who is serving on both the Baxter Board and the Baxalta Board, the number of Baxter Common Shares subject
to such Adjusted Baxter Option (if any), rounded down to the nearest whole number, shall be equal to (1) the number of Baxter Common Shares subject to the Baxter Option immediately prior to the Distribution Date, divided by (2) the Baxter
Percentage; 
 (D) with respect to each Baxter Option granted on or after January 1, 2015 (or, with respect to new hire
grants, on or after July 1, 2014) to any holder thereof who, as of immediately following the Distribution Date, is serving on the Baxalta Board, but not the Baxter Board, the number of shares of Baxalta Common Stock subject to such Baxalta
Option (if any), rounded down to the nearest whole number, shall be equal to (1) the product obtained by multiplying (xx) the number of Baxter Common Shares subject to the Baxter Option immediately prior to the Distribution Date times (yy)
the Distribution Ratio, divided by (2) the Baxalta Percentage; 
 (E) the per share exercise price of each Adjusted
Baxter Option, rounded up to the nearest hundredth of a cent, shall be equal to (1) the Baxter Pre-Distribution Stock Value minus (2) the Baxter Pre-Distribution Option Value; and 

(F) the per share exercise price of each Baxalta Option, rounded up to the nearest hundredth of a cent, shall be equal to
(1) the Baxalta Stock Value minus (2) the Baxalta Pre-Distribution Option Value; 
 provided, however, that the exercise price, the
number of Baxter Common Shares and shares of Baxalta Common Stock subject to such options, and the terms and conditions of exercise of such options shall be determined in a manner consistent with the requirements of Code Section 409A. 

  
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 (b) Baxter RSU Awards. Each holder of Baxter RSU Awards granted prior to January 1,
2015 (other than new hire grants made on or after July 1, 2014) that remain outstanding as of immediately prior to the Distribution Date, regardless of by whom held, whether vested or unvested, shall receive (in addition to retaining such
Baxter RSU Awards) concurrently with the Distribution on the Distribution Date a number of Baxalta RSU Awards equal to the product obtained by multiplying (i) the number of such Baxter RSU Awards held by such holder times (ii) the
Distribution Ratio. Each Baxter RSU Award granted on or after January 1, 2015 (or, with respect to new hire grants, on or after July 1, 2014) but prior to the Distribution Date that remains outstanding as of immediately prior to the
Distribution Date, regardless of by whom held, whether vested or unvested, shall be converted concurrently with the Distribution on the Distribution Date into (i) an Adjusted Baxter RSU Award in the case any holder thereof who, as of
immediately following the Distribution Date, is not serving on the Baxalta Board or who is serving on both the Baxter Board and the Baxalta Board or (ii) a Baxalta RSU Award in the case of any holder thereof who, as of immediately following the
Distribution Date, is serving on the Baxalta Board, but not the Baxter Board. Except as set forth in this Section 6.04(b), all Adjusted Baxter RSU Awards and Baxalta RSU Awards issued in accordance with this Section 6.04(b)
shall be subject to substantially the same terms and conditions (including with respect to vesting) immediately following the Distribution Date as applicable immediately prior to the Distribution Date for those Baxter RSU Awards from which such
Adjusted Baxter RSU Awards and Baxalta RSU Awards were converted; provided, however, that with respect to each Baxter RSU Award converted in accordance with the immediately preceding sentence: 

(A) the number of units represented by an Adjusted Baxter RSU Award shall be equal to (1) the number of units subject to
the Baxter RSU Award immediately prior to the Distribution Date, divided by (2) the Baxter Percentage; 
 (B) the
number of units represented by a Baxalta RSU Award shall be equal to (1) the product obtained by multiplying (xx) the number of units subject to the Baxter RSU Award immediately prior to the Distribution Date times (yy) the Distribution
Ratio, divided by (2) the Baxalta Percentage. 
 Section 6.05 Directors’ Deferred Compensation Plan. 

(a) Establishment of Baxalta Directors’ DCP. Effective as of or before the Distribution Date, Baxalta shall establish the Baxalta
Directors’ DCP, with terms substantially similar to those of the Baxter Directors’ DCP as of the Distribution Date. The portion of the compensation paid to a director of Baxalta in the year that includes the Distribution Date that is
deferred pursuant to the Baxter Directors’ DCP shall be determined by the deferral election, if any, made by such director for such year pursuant to the Baxter Directors’ DCP. 

  
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 (b) Assumption of Directors’ DCP Liabilities and Transfer from Baxter Directors’
DCP. 
 (i) As of the Distribution Date, Baxalta shall, and shall cause the Baxalta Directors’ DCP to, assume all
Liabilities for all obligations under the Baxter Directors’ DCP for the benefits of each person who will serve on the Baxalta Board, but not the Baxter Board, as of immediately following the Distribution Date, together with his or her
beneficiaries and/or alternate payees, determined as of the applicable Distribution Date, and Baxter and the Baxter Directors’ DCP shall be relieved of all Liabilities for those benefits. To the maximum extent permitted by Treasury Regulations
Section 1.409A-1(h)(4), a member of the Baxter Board whose benefit under the Baxter Director’s DCP is transferred to the Baxalta Directors’ DCP shall not be considered to have undergone a “separation from service” for
purposes of Code Section 409A and the Baxter Directors’ DCP solely by reason of the Separation, regardless of whether he continues to serve on the Baxter Board immediately following the Distribution Date. 

(ii) Baxter shall retain all of the Liabilities under the Baxter Directors’ DCP with respect to the benefits of each
person who will serve on both the Baxalta Board and the Baxter Board as of immediately following the Distribution Date, together with his or her beneficiaries and/or alternate payees. The time and form of payment of such Liabilities shall be based
upon the date on which such persons terminate their service on the Baxter Board regardless of whether they continue to serve on the Baxalta Board. 

(iii) As of or as soon as practicable after the Distribution Date, the Parties shall cooperate to cause the accounts of each
person who will serve on the Baxalta Board, but not the Baxter Board, as of immediately following the Distribution Date, participating in the Baxter Directors’ DCP to be transferred to the Baxalta Directors’ DCP. Baxalta shall
(A) credit each such director’s account with (1) the amount deferred by such individual into the Baxter Directors’ DCP as of the Distribution Date, plus (2) any employer contributions, whether vested or unvested, deemed to
have been made in relation to the amount described in (1), including, in each case, any earnings thereon, and (B) recognize and honor all deferral and distribution elections made by such individual (including any deferral election applicable to
any amount earned but not yet paid as of the Distribution Date). 
 (iv) The accrued benefit of each director under the
Baxter Directors’ DCP as of the applicable Transfer Date shall be payable under the Baxalta Directors’ DCP at the same time and in the same form that would have been paid under the Baxter Directors’ DCP, treating such director’s
separation from service from the Baxalta Group as if it were a separation from service from the Baxter Group, and taking into account any election made by the director relating to the time and form of his payment under the Baxter Director’s
DCP. 
 (c) Baxter Directors’ DCP after Transfer Date. From and after the Distribution Date, each person who will serve on the
Baxalta Board, but not the Baxter Board, as of immediately following the Distribution Date shall not participate in or accrue any benefits under the Baxter Directors’ DCP. Without limiting the generality of the foregoing, each such person shall
cease to participate in the Baxter Directors’ DCP effective as of the Distribution Date. The Baxter Directors’ DCP shall continue to be responsible for Liabilities in respect of members of the Baxter Board and their beneficiaries and/or
alternate payees. 

  
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 ARTICLE VII 

MISCELLANEOUS 

Section 7.01 Transfer of Records and Information. Baxter shall transfer to Baxalta originals or copies of any and all
employment records and information (including, but not limited to, any personnel files, performance reviews, and medical, social security and tax files and forms) with respect to Transferred Employees and other records reasonably required by Baxalta
to enable Baxalta properly to carry out its obligations under this Agreement. Such transfer of records and information generally shall occur as soon as administratively practicable on or after the Distribution Date (or, if later, the applicable
Transfer Date) and shall in each case be required and shall occur only to the extent permitted by applicable local Law; provided that it is understood and agreed that certain records required to effect the contemplated transfer of employment
may be provided prior to the Transfer Date to the extent required by applicable local Law. Each Party will permit the other Party reasonable access to Employee records and information, to the extent reasonably necessary for such accessing Party to
carry out its obligations hereunder. 
 Section 7.02 Cooperation. Each Party shall upon reasonable request provide the
other Party and the other Party’s respective Affiliates, agents, and vendors all information reasonably necessary to the other Party’s performance of its obligations hereunder. The Parties agree to use their respective best efforts and to
cooperate with each other in order to carry out their obligations hereunder and to effectuate the terms of this Agreement. 

Section 7.03 Employee Agreements. Effective as of the applicable Transfer Date of each Transferred Employee, Baxter and the
applicable members of the Baxter Group hereby assign to Baxalta or another member of the Baxalta Group, to the extent a Transferred Employee did not otherwise sign an Employee Agreement to effect his or her transfer to and hiring by the Baxalta
Group, each Employee Agreement entered into between a member of the Baxter Group and any Baxalta Employee, and all rights and obligations thereunder; provided, however, that Baxter and the Baxter Group shall retain all rights under each
Employee Agreement to the extent that such rights are related to any continuing Liability of the Baxter Group not assumed by Baxalta in connection with the Separation and Distribution (including herein). Upon written request by Baxter or the Baxter
Group, Baxalta or the Baxalta Group shall make available to Baxter or the Baxter Group the original copy of any written Employee Agreement (and a summary of the terms of any unwritten Employee Agreement) that was assigned to Baxalta or the Baxalta
Group under this Agreement. 
 Section 7.04 Repayment Assets. Effective as of the Distribution Date, the Baxter Group
shall be entitled to all Employee Recoupment Assets in respect of Baxter Retained Employees and Former Employees, and effective as of the applicable Transfer Date, the Baxalta Group shall be entitled to all Employee Recoupment Assets in respect of
Baxalta Employees. 

  
 45 

 Section 7.05 Compliance. The agreements and covenants of the Parties hereunder
shall at all times be subject to the requirements and limitations of applicable Law (including, for purposes of Article IV, local rules and customs relating to the treatment of pension plans) and collective bargaining agreements. Where an agreement
or covenant of a Party hereunder cannot be effected in compliance with applicable Law or an applicable collective bargaining agreement, the Parties agree to negotiate in good faith to modify such agreement or covenant to the least extent possible in
keeping with the original agreement or covenant in order to comply with applicable Law or such applicable collective bargaining agreement. Each provision of this Agreement is subject to and qualified by this Section 7.05, whether or not
such provision expressly states that it is subject to or limited by applicable Law or by applicable collective bargaining agreements. Each reference to the Code, ERISA, or the Securities Act or any other Law shall be deemed to include the rules,
regulations, and guidance issued thereunder. 
 Section 7.06 Preservation of Rights. Unless expressly provided otherwise
in this Agreement, nothing herein shall be construed as a limitation on the right of the Baxter Group or the Baxalta Group to (a) amend, modify or terminate any Benefit Plan or (b) terminate the employment of any Employee. 

Section 7.07 Reimbursement. The Parties acknowledge that the Baxter Group, on the one hand, and the Baxalta Group, on the
other hand, may incur costs and expenses (including, without limitation, contributions to Benefit Plans and the payment of insurance premiums) which are, as set forth in this Agreement, the responsibility of the other Party. Accordingly, the Parties
agree to reimburse each other for Liabilities and obligations for which such Party is responsible, and shall provide such reimbursement reasonably promptly and in accordance with the terms of any agreement between the Parties or their Affiliates
expressly addressing such matters. 
 Section 7.08 Matching Grant Plan. Baxter covenants and agrees that the Baxter
International Foundation shall retain all Liabilities under the Matching Gifts Program with respect to donations made by any Transferred Employee prior to the Transfer Date. Baxter covenants and agrees that the Baxter International Foundation is to
match or cause to be matched all eligible donations made prior to the Distribution Date, in accordance with the terms of the Matching Gifts Program. 

Section 7.09 Not a Change in Control. The Parties acknowledge and agree that the transactions contemplated by the
Separation and Distribution Agreement and this Agreement do not constitute a “change in control” or a “change of control” for purposes of any Benefit Plan. 

Section 7.10 Incorporation by Reference. The following sections of the Separation and Distribution Agreement are hereby
incorporated into this Agreement by reference: Section 9.01. Counterparts, Entire Agreement, Corporate Power, Facsimile Signatures; Section 9.02. Governing Law; Section 9.03. Assignability; Section 9.04. Third Party
Beneficiaries; Section 9.05. Notices; Section 9.06. Severability; Section 9.07. Force Majeure; Section 9.08. No Set Off; Section 9.09. Responsibility for Expenses; Section 9.10. Headings; Section 9.11. Survival of
Covenants; Section 9.13. Waivers; Section 9.14. Amendments; Section 9.15. Interpretation; Section 9.16. Public Announcements; Section 9.17. Specific Performance; and Section 9.18. Mutual Drafting. 

  
 46 

 Section 7.11 Limitation on Enforcement. This Agreement is an agreement solely
between the Parties. Nothing in this Agreement, whether express or implied, shall be construed to: (a) confer upon any current or former Employee of the Baxter Group or the Baxalta Group, or any other person any rights or remedies, including,
but not limited to any right to (i) employment or recall; (ii) continued employment or continued service for any specified period; or (iii) claim any particular compensation, benefit or aggregation of benefits, of any kind or nature;
or (b) create, modify, or amend any Benefit Plan. 
 Section 7.12 Further Assurances and Consents. In addition to
the actions specifically provided for elsewhere in this Agreement, each of the Parties hereto shall use commercially reasonable efforts to (a) execute and deliver such further instruments and documents and take such other actions as the other
party may reasonably request to effectuate the purposes of this Agreement and carry out the terms hereof; (b) take, or cause to be taken, all actions, and do, or cause to be done, all things, reasonably necessary, proper or advisable under
applicable Laws and agreements or otherwise to consummate and make effective the transactions contemplated by this Agreement, including, without limitation, using commercially reasonable efforts to obtain any consents and approvals and to make any
filings and applications necessary or desirable to consummate the transactions contemplated by this Agreement; provided that no Party shall be obligated to pay any consideration therefor (except for filing fees and other similar charges) to
any third party from whom those consents, approvals and amendments are required or to take any action or omit to take any action if the taking of action or the omission to take action would be unreasonably burdensome to the Party or the business
thereof. 
 Section 7.13 Third Party Consent. If the obligation of any Party under this Agreement depends on the consent
of a third party, such as a vendor or insurance company, and that consent is withheld, the Parties shall use commercially reasonable efforts to implement the applicable provisions of this Agreement to the fullest extent practicable. If any provision
of this Agreement cannot be implemented due to the failure of a third party to consent, the Parties shall negotiate in good faith to implement the provision in a mutually satisfactory manner, taking into account the original purposes of the
provision in light of the Distribution and communications to affected individuals. 
 Section 7.14 Effect if Distribution Does
Not Occur. If the Distribution does not occur, then all actions and events that are to be taken under this Agreement, or otherwise in connection with the Distribution, shall not be taken or occur, except to the extent specifically provided
by Baxter. 
 Section 7.15 Disputes. The Parties agree to use commercially reasonable efforts to resolve in an amicable
manner any and all controversies, disputes and claims between them arising out of or related in any way to this Agreement. The Parties agree that any controversy, dispute or claim (whether arising in contract, tort or otherwise) arising out of or
related in any way to this Agreement that cannot be amicably resolved informally will be resolved pursuant to the dispute resolution procedures set forth in Article VII of the Separation and Distribution Agreement. 

Section 7.16 Reverse Jurisdiction. Notwithstanding anything in this Agreement to the contrary, with the exception of
Article I, Section 2.01 and this Section 7.16, the 

  
 47 

 
parties acknowledge and agree that for each of the entities or countries listed in Schedule 7.16, where the context so requires in accordance with the applicable local Conveyance and
Assumption Instruments, each reference to “Baxalta” in this Agreement shall be construed as a reference to “Baxter,” and each reference to “Baxter” in this Agreement shall be construed as a reference to
“Baxalta.” For the avoidance of doubt and where such treatment is reasonable in light of the context, this Section 7.16 shall be interpreted to provide substantially the same treatment for the entities or jurisdictions listed
in Schedule 7.16 (but with the Baxter and Baxalta roles reversed) to Baxter Retained Employees who are legally employed by the Baxalta Group for a period prior to such Employee’s legal transfer back to the Baxter Group by agreement of
the Parties, as the treatment herein with respect to Post-Distribution Baxalta Employees. 
 [SIGNATURE PAGE FOLLOWS] 

  
 48 

 The Parties have caused this Agreement to be signed by their authorized representatives as of the
date of this Agreement. 
  

			
	BAXTER INTERNATIONAL INC.
		
	By:		 /s/ James K. Saccaro

			James K. Saccaro
	Title:		Corporate Vice President
	
	BAXALTA INCORPORATED
		
	By:		 /s/ Robert J. Hombach

			Robert J. Hombach
	Title:		Corporate Vice President and Chief Financial Officer

 Schedule 1.01 

Post-Distribution Baxalta Employees 
  

			
	Empl ID	  	Work Country
	201120	  	United Arab Emirates
	389152	  	Argentina
	409130	  	Argentina
	364235	  	Argentina
	369271	  	Argentina
	369272	  	Argentina
	410775	  	Argentina
	428032	  	Argentina
	413028	  	Argentina
	392668	  	Argentina
	318369	  	Argentina
	219786	  	Argentina
	235443	  	Argentina
	217040	  	Argentina
	235353	  	Argentina
	388853	  	Argentina
	238797	  	Argentina
	185638	  	Argentina
	355920	  	Argentina
	223330	  	Argentina
	213688	  	Argentina
	415472	  	Argentina
	290095	  	Bulgaria
	228826	  	Bulgaria
	387126	  	Bulgaria
	428850	  	Brazil
	422203	  	Brazil
	389223	  	Brazil
	392861	  	Brazil
	414178	  	Brazil
	394167	  	Brazil
	397959	  	Brazil
	390038	  	Brazil
	389579	  	Brazil
	159361	  	Brazil
	423457	  	Brazil
	363895	  	Brazil
	196674	  	Brazil
	394759	  	Brazil
	305574	  	Brazil
	388951	  	Brazil
	404926	  	Brazil
	236257	  	Brazil

			
	388132		Brazil
	193117		Brazil
	422195		Brazil
	409496		Brazil
	391740		Brazil
	210757		Brazil
	226225		Brazil
	185296		Brazil
	410031		Brazil
	398603		Brazil
	386778		Brazil
	388828		Brazil
	239326		Brazil
	398604		Brazil
	395223		Brazil
	220979		Brazil
	363304		Brazil
	416288		Brazil
	395874		Brazil
	421284		Brazil
	218793		Brazil
	407419		Brazil
	386771		Brazil
	415136		Brazil
	419197		Brazil
	404922		Brazil
	150746		Brazil
	210784		Brazil
	386318		Brazil
	414179		Brazil
	392059		Brazil
	420896		Brazil
	387744		Brazil
	421553		Brazil
	398610		Brazil
	416368		Brazil
	417561		Brazil
	406185		Brazil
	422315		Brazil
	384525		Brazil
	413481		Brazil
	418820		Brazil
	229002		Brazil
	207803		Brazil
	364693		Brazil
	420267		Brazil
	362323		Brazil
	218270		Brazil
	421730		Brazil
	239841		Chile

			
	231429		Chile
	398279		Chile
	388086		China
	188658		China
	405203		China
	382131		China
	397128		China
	386751		China
	394523		China
	360880		China
	388841		China
	414041		China
	390884		China
	424992		China
	427514		China
	394391		China
	389442		China
	427807		China
	359344		China
	198967		China
	184417		China
	390799		China
	344224		China
	397020		China
	344069		China
	395355		China
	391874		China
	394498		China
	238538		China
	385176		China
	364441		China
	387220		China
	425839		China
	410774		China
	392139		China
	361173		China
	428053		China
	389497		China
	398060		China
	422963		China
	387321		China
	393729		China
	237927		China
	387296		China
	232063		China
	231576		China
	417608		China
	415944		China
	364442		China
	389416		China

			
	396665		China
	428261		China
	392308		China
	383912		China
	394045		China
	364834		China
	387463		China
	419632		China
	389921		China
	414047		China
	364115		China
	396447		China
	420020		China
	427216		China
	364199		China
	182887		China
	394910		China
	406124		China
	395053		China
	238542		China
	427574		China
	387292		China
	420753		China
	420751		China
	386795		China
	204625		China
	426791		China
	421714		China
	388025		China
	391225		China
	394716		China
	419980		China
	363450		China
	388622		China
	415662		China
	424754		China
	396449		China
	387726		China
	234685		China
	385628		China
	383872		China
	414856		China
	399658		China
	207146		China
	389411		China
	382461		China
	362619		China
	189034		China
	406813		China
	344304		China

			
	428252		China
	228985		China
	394246		China
	218997		China
	364238		China
	195159		China
	384292		China
	417301		China
	207761		China
	382738		China
	408660		China
	362198		China
	229591		China
	423994		China
	345016		China
	425837		China
	362439		China
	422046		China
	234372		China
	417602		China
	418798		China
	389336		China
	390942		China
	384180		China
	218127		China
	389153		China
	398831		China
	426021		China
	396199		China
	423992		China
	383778		China
	198263		China
	154558		Costa Rica
	388856		Costa Rica
	396294		Costa Rica
	392608		Czech Republic
	395326		Czech Republic
	414983		Czech Republic
	425991		Czech Republic
	427578		Czech Republic
	397559		Czech Republic
	383917		Czech Republic
	111720		Czech Republic
	235376		Czech Republic
	110804		Czech Republic
	418367		Czech Republic
	196641		Czech Republic
	306777		Czech Republic
	239711		Czech Republic
	389980		Czech Republic

			
	363747		Czech Republic
	232011		Czech Republic
	203533		Czech Republic
	111378		Czech Republic
	132641		Czech Republic
	111084		Czech Republic
	132165		Czech Republic
	148048		Czech Republic
	113735		Czech Republic
	221468		Czech Republic
	213534		Czech Republic
	110913		Czech Republic
	220753		Czech Republic
	140344		Czech Republic
	159351		Czech Republic
	126414		Czech Republic
	110805		Czech Republic
	206541		Czech Republic
	217392		Czech Republic
	183779		Czech Republic
	140388		Czech Republic
	111829		Czech Republic
	223311		Czech Republic
	151203		Czech Republic
	232549		Czech Republic
	199245		Czech Republic
	201095		Czech Republic
	186664		Czech Republic
	111293		Czech Republic
	111212		Czech Republic
	131517		Czech Republic
	132178		Czech Republic
	207839		Czech Republic
	131495		Czech Republic
	147697		Czech Republic
	234379		Czech Republic
	128222		Czech Republic
	390221		Ecuador
	359192		Ecuador
	388053		Ecuador
	156439		Ecuador
	349801		Ecuador
	239727		Estonia
	357059		Greece
	156102		Greece
	355880		Greece
	315220		Greece
	397654		Greece
	355884		Greece
	356729		Greece

			
	427733		Greece
	355881		Greece
	352385		Greece
	353816		Greece
	181475		Greece
	103739		Greece
	217119		Greece
	289971		Greece
	407538		Guatemala
	383344		Guatemala
	424861		Guatemala
	218654		Guatemala
	189929		Hungary
	398488		Hungary
	231608		Hungary
	226752		Hungary
	159795		Hungary
	384380		Hungary
	289986		Hungary
	394549		India
	411467		India
	385387		India
	413524		India
	416806		India
	167047		India
	182428		India
	427972		India
	411013		India
	361631		India
	364309		India
	413809		India
	426669		India
	385098		India
	399331		India
	406600		India
	410778		India
	392208		India
	399948		India
	305879		India
	167475		India
	426371		India
	398447		India
	411945		India
	427500		India
	306167		India
	228143		India
	407926		India
	412570		India
	195467		India
	412007		India

			
	182723		India
	421562		India
	222233		India
	229014		India
	398929		India
	408167		India
	424875		India
	427132		India
	351742		India
	177877		India
	386762		India
	386611		India
	417348		India
	384277		India
	208968		India
	411424		India
	415013		India
	391875		India
	360849		India
	406487		India
	394678		India
	410777		India
	411470		India
	391756		India
	195236		India
	406541		India
	405992		India
	381741		India
	361129		India
	395020		India
	425951		India
	405658		India
	426367		India
	423609		India
	399570		India
	361931		India
	411329		India
	382657		India
	405496		India
	364196		India
	388448		India
	411549		Kazakhstan
	409972		Kazakhstan
	418080		Kazakhstan
	390192		Kazakhstan
	301943		Kazakhstan
	359570		Kazakhstan
	398835		Kazakhstan
	416206		Kazakhstan
	427491		Kazakhstan

			
	412800		Kazakhstan
	426909		Kazakhstan
	412988		Kazakhstan
	239851		Lithuania
	239850		Lithuania
	159075		Latvia
	419765		Latvia
	414787		Malaysia
	216934		Malaysia
	229014		Malaysia
	394814		Malaysia
	387440		Panama
	160405		Poland
	384163		Poland
	356743		Poland
	238593		Poland
	382940		Poland
	364298		Poland
	222762		Poland
	290202		Poland
	412687		Poland
	385790		Poland
	212532		Poland
	180877		Poland
	234344		Poland
	290204		Poland
	306465		Poland
	364296		Poland
	235061		Poland
	218883		Poland
	218888		Poland
	385154		Poland
	411703		Poland
	407930		Poland
	392629		Poland
	235060		Poland
	399477		Poland
	290148		Poland
	238726		Poland
	413991		Poland
	200852		Poland
	206401		Poland
	426434		Poland
	384412		Poland
	225433		Poland
	234705		Poland
	217092		Poland
	215598		Poland
	200029		Poland
	426056		Poland

			
	410410		Romania
	410677		Romania
	410738		Romania
	410737		Romania
	411725		Romania
	406099		Romania
	407893		Romania
	228861		Russia
	413557		Russia
	423494		Russia
	361116		Russia
	290236		Russia
	395510		Russia
	420082		Russia
	406951		Russia
	414912		Russia
	413555		Russia
	392403		Russia
	238315		Russia
	428731		Russia
	397359		Russia
	226893		Russia
	423682		Russia
	229683		Russia
	412971		Russia
	419156		Russia
	399066		Russia
	414035		Russia
	412852		Russia
	384566		Russia
	236651		Russia
	405488		Russia
	239335		Russia
	362104		Russia
	397088		Russia
	290262		Russia
	414652		Russia
	397823		Russia
	411056		Russia
	157971		Russia
	427007		Russia
	411623		Russia
	384917		Russia
	399798		Russia
	406346		Russia
	357088		Russia
	393703		Russia
	406945		Russia
	416405		Russia
	410726		Russia

			
	389561		Russia
	238222		Russia
	382215		Russia
	405317		Russia
	414911		Russia
	417773		Russia
	392406		Russia
	426359		Russia
	416309		Russia
	414033		Russia
	237128		Russia
	421414		Russia
	415906		Slovakia
	427343		Slovakia
	387197		Slovakia
	427878		Slovakia
	388024		Slovakia
	427742		Slovakia
	408263		Slovakia
	214012		Slovakia
	425332		Slovakia
	219614		Slovakia
	110804		Slovakia
	385458		Slovakia
	364217		Slovakia
	359110		Slovakia
	362593		Slovakia
	395747		Slovakia
	407587		Slovenia
	413451		Slovenia
	412141		Slovenia
	237045		Thailand
	235531		Thailand
	411709		Thailand
	236362		Thailand
	417445		Thailand
	418034		Thailand
	395843		Thailand
	406913		Thailand
	393318		Thailand
	395877		Thailand
	385368		Thailand
	410161		Thailand
	366863		Taiwan
	422110		Taiwan
	350893		Taiwan
	395695		Taiwan
	411801		Taiwan
	409133		Taiwan
	234395		Taiwan

			
	392153		Taiwan
	427413		Ukraine
	416021		Ukraine
	427870		Ukraine
	204472		Venezuela
	384506		Vietnam
	389007		Vietnam
	393041		Vietnam
	427148		Vietnam

  

	*	Parties may agree from time to time to designate other employees not yet transferred as of the Distribution Date to the list of Post-Distribution Baxalta Employees;
provided that, for the avoidance of doubt, any such employee shall (unless the parties expressly agree otherwise) shall be treated as a Baxter employee as of the Distribution Date for purposes of all equity award adjustments and conversions
in the manner described in the Employee Matters Agreement. 

 Schedule 2.03(a) 

Baxter Benefit Plans 
  

 
 

 
  
  
 

 

  
 

 
  
  
 

 
  
  
 

 

  
 

 
  
  
 

 

  
 

 
  
  
 

 

 Schedule 4.01(a) / 4.02(a)(ii) 

Baxalta Non-U.S. Plans – Former Employees 
  

	 	1.	Austria Baxter AG Retirement Plan 

  

	 	2.	Austria Innovations GmbH Retirement Plan 

  

	 	3.	Switzerland Baxter Bioscience 

  

	 	4.	Switzerland Baxter AG 

  

	 	5.	Switzerland Baxter Healthcare 

 Mutual Agreement Re: Asset Transfer Methodology 

The Parties mutually agree, as contemplated by the following provisions of Section 4.01(a) and Section 4.02(a)(ii) of the Agreement, for the
avoidance of doubt, that where applicable local Laws specify the method for valuation, the applicable local Laws will be followed (but interpreted as closely as possible to the language of the Agreement to the extent such an interpretation is
permitted). 
 Applicable Excerpt – Section 4.01(a) 

Assets will be allocated between the plans based on the proportion of Liabilities borne by each plan. Except as otherwise mutually agreed upon by the Parties,
such Liabilities will be valued using the projected benefit obligation based on plan provisions as in effect at the Applicable Closing Date and applying demographic and other assumptions used in the most recently completed valuation of the
applicable Non-U.S. Baxter Benefit Plan (and taking into account the requirements of ASC 715 as it exists as of the Applicable Closing Date); provided, however, that all economic assumptions will be updated as of the Applicable Closing
Date. 
 Applicable Excerpt – Section 4.02(a)(ii) 

Assets will be allocated between the plans based on the proportion of Liabilities borne by each plan. Except as otherwise mutually agreed upon by the Parties,
such Liabilities will be valued as of the Shared Plan Replacement Date using the projected unit credit method based on plan provisions as in effect at the Shared Plan Replacement Date and applying the demographic and other assumptions used in the
most recently completed valuation of the applicable Non-U.S. Baxter Benefit Plan (and taking into account the requirements of ASC 715 as it exists as of the Shared Plan Replacement Date); provided, however, that all economic
assumptions will be updated as of the Shared Plan Replacement Date. 

 Schedule 4.02(a) 

Continued Baxalta Participation in Baxter Non-U.S. Plans 
  

	 	1.	Switzerland (*) – Baxter and Baxalta employees will continue to participate in the existing Baxter Swiss pension foundation until on or about January 1, 2016. On or about January 1, 2016, the
existing Baxter Swiss pension foundation will transfer to Baxalta and active Baxter employees as of such date will transfer out of the current Swiss pension foundation into a newly established Baxter Swiss pension foundation or a separate
multi-employer foundation. 

  

	 	2.	Japan 

  

	 	•	 	Assets for defined benefit pension plan will be combined until government approval by MHLW 

 Schedule 5.01(c)(iii) 

Flexible Spending Accounts 
  

	 	•	 	Canada 

  

	 	•	 	Spending credits will not transfer to Baxalta 

  

	 	•	 	Participants have been advised that Flex credits need to be used by June 30th and they have 90 days post
June 30th to process claims through Baxter. 

 Schedule 6.01(e) 

Equity Adjustment Exceptions 
  

	 	1.	Certain re-hire grants made after July 1, 2014 will be subject to the “basket” approach described in Section 6.01(a) such that those awards (as determined in agreement with the applicable employee)
are treated in the same manner as 2014 awards that were not new hire grants. 

 Schedule 7.16 

Reverse Jurisdictions 
  

	 	1.	Austria Baxter AG Retirement Plan 

  

	 	2.	Austria Innovations GmbH Retirement Plan 

  

	 	3.	Switzerland Baxter Bioscience 

  

	 	4.	Switzerland Baxter AG 

  

	 	5.	Switzerland Baxter HealthcareEX-10.3

 Exhibit 10.3 

Shareholder’s and Registration Rights Agreement 

by and between 
 Baxter
International Inc. 
 and 

Baxalta Incorporated 
 Dated as of
June 30, 2015 

 TABLE OF CONTENTS 

 

							
	 ARTICLE I Definitions
		 	1	  
			
	 Section 1.01
		 Definitions
		 	1	  
			
	 Section 1.02
		 Interpretation
		 	6	  
		
	 ARTICLE II Registration Rights
		 	7	  
			
	 Section 2.01
		 Registration
		 	7	  
			
	 Section 2.02
		 Piggyback Registrations
		 	10	  
			
	 Section 2.03
		 Registration Procedures
		 	12	  
			
	 Section 2.04
		 Underwritten Offerings or Exchange Offers
		 	18	  
			
	 Section 2.05
		 Registration Rights Agreement with Participating Banks
		 	19	  
			
	 Section 2.06
		 Registration Expenses Paid by Baxalta
		 	19	  
			
	 Section 2.07
		 Indemnification
		 	19	  
			
	 Section 2.08
		 Reporting Requirements; Rule 144
		 	22	  
			
	 Section 2.09
		 Registration Rights Covenant
		 	22	  
		
	 ARTICLE III Voting Restrictions
		 	22	  
			
	 Section 3.01
		 Voting of Baxalta Common Stock
		 	22	  
		
	 ARTICLE IV Miscellaneous
		 	23	  
			
	 Section 4.01
		 Term
		 	23	  
			
	 Section 4.02
		 Counterparts; Entire Agreement; Corporate Power
		 	23	  
			
	 Section 4.03
		 Disputes
		 	24	  
			
	 Section 4.04
		 Amendment
		 	24	  
			
	 Section 4.05
		 Waiver of Default
		 	24	  
			
	 Section 4.06
		 Successors, Assigns and Transferees
		 	25	  
			
	 Section 4.07
		 Further Assurances
		 	26	  
			
	 Section 4.08
		 Performance
		 	26	  
			
	 Section 4.09
		 Notices
		 	26	  
			
	 Section 4.10
		 Severability
		 	27	  
			
	 Section 4.11
		 No Reliance on Other Party
		 	27	  
			
	 Section 4.12
		 Registrations, Exchanges. etc.
		 	27	  
			
	 Section 4.13
		 Mutual Drafting
		 	27	  
			
	 Exhibit A
		 Form of Agreement to be Bound
				

  
 -i- 

 SHAREHOLDER’S AND REGISTRATION RIGHTS AGREEMENT 

This Shareholder’s and Registration Rights Agreement (this “Agreement”) is made as of June 30, 2015, by and between Baxter
International Inc., a Delaware corporation (“Baxter”), and Baxalta Incorporated, a Delaware corporation and wholly owned subsidiary of Baxter (“Baxalta”). Capitalized terms used herein and not otherwise defined
shall have the respective meanings assigned to them in Section 1.01. 
 RECITALS 

A. Pursuant to the Separation and Distribution Agreement, dated as of June 30, 2015 (the “Separation and Distribution Agreement”), by
and between Baxter and Baxalta, Baxter will distribute more than 80% of the outstanding shares of common stock, par value $0.01 per share, of Baxalta (the “Common Stock”) to Baxter’s shareholders (the
“Distribution”). 
 B. Baxter may Sell those shares of Common Stock that are not distributed in the Distribution (such shares not
distributed in the Distribution, the “Retained Shares”) through one or more transactions, including pursuant to one or more transactions registered under the Securities Act. 

C. Baxalta desires to grant to the Baxter Group the Registration Rights for the Retained Shares and other Registrable Securities, subject to the terms and
conditions of this Agreement. 
 D. Baxter Group desires to grant Baxalta a proxy to vote the Retained Shares in proportion to the votes cast by
Baxalta’s other shareholders, subject to the terms and conditions of this Agreement. 
 AGREEMENTS 

NOW, THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as follows: 
 ARTICLE I 

Definitions 
 Section 1.01
Definitions. 
 As used in this Agreement, the following terms shall have the following meanings: 

“Affiliate” means, when used with respect to a specified Person, a Person that, directly or indirectly, through one or more intermediaries,
controls, is controlled by or is under common control with such specified Person. As used in this definition, the term “control” (including with correlative meanings, “controlled by” and “under common control
with”), when used with respect to any specified Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting
securities or other interests, by contract, agreement, obligation, indenture, instrument, lease, promise, arrangement, release, warranty, commitment, undertaking or 

 
otherwise. It is expressly agreed that, from and after the Distribution Date, no member of the Baxalta Group shall be deemed to be an Affiliate of any member of the Baxter Group, and no member of
the Baxter Group shall be deemed to be an Affiliate of any member of the Baxalta Group. 
 “Agreement” has the meaning set forth in the
preamble. 
 “Ancillary Filings” has the meaning set forth in Section 2.03(a)(i). 

“Baxalta” has the meaning set forth in the preamble and shall include Baxalta’s successors by merger, acquisition, reorganization or
otherwise. 
 “Baxalta Group” means Baxalta, each Subsidiary of Baxalta and each Affiliate of Baxalta (in each case other than any member
of the Baxter Group). 
 “Baxalta Public Sale” has the meaning set forth in Section 2.02(a). 

“Baxter” has the meaning set forth in the preamble and shall include Baxter’s successors by merger, acquisition, reorganization or
otherwise. 
 “Baxter Group” means Baxter, each Subsidiary of Baxter and each Affiliate of Baxter (in each case other than any member of
the Baxalta Group). 
 “Blackout Notice” has the meaning set forth in Section 2.01(d). 

“Blackout Period” has the meaning set forth in Section 2.01(d). 

“Board” means the board of directors of Baxalta. 

“Business Day” means any day that is not a Saturday, Sunday or other day on which banking institutions doing business in New York, New York
are authorized or obligated by law or required by executive order to be closed. 
 “Common Stock” has the meaning set forth in the
recitals. 
 “Debt” means any indebtedness of any member of the Baxter Group, including debt securities, notes, credit facilities, credit
agreements and other debt instruments, including, in each case, any amounts due thereunder. 
 “Demand Registration” has the meaning set
forth in Section 2.01(a). 
 “Disadvantageous Condition” has the meaning set forth in Section 2.01(d). 

“Dispute” has the meaning set forth in Section 4.03(a). 

“Distribution” has the meaning set forth in the recitals. 

“Distribution Date” means the date and time at which the Distribution occurs. 

  
 -2- 

 “Exchanges” means one or more Public Exchanges or Private Exchanges. 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and any successor thereto, and any rules and regulations
promulgated thereunder, all as the same shall be in effect from time to time. 
 “Exchange Offer” means an exchange offer of Registrable
Securities for outstanding securities of a Holder. 
 “Governmental Authority” means any nation or government, any state, municipality or
other political subdivision thereof, and any entity, body, agency, commission, department, board, bureau, court, tribunal or other instrumentality, whether federal, state, local, domestic, foreign or multinational, exercising executive, legislative,
judicial, regulatory, administrative or other similar functions of, or pertaining to, government and any executive official thereof. 

“Holder” means any member of the Baxter Group, so long as such Person holds any Registrable Securities, and any Permitted Transferee, so long
as such Person holds any Registrable Securities. 
 “Indemnifying Party” has the meaning set forth in Section 2.07(c). 

“Indemnitee” has the meaning set forth in Section 2.07(c). 

“Initiating Holder” has the meaning set forth in Section 2.01(a). 

“Limited Transferee” has the meaning set forth in Section 4.06(b). 

“Loss” and “Losses” have the meaning set forth in Section 2.07(a). 

“Offering Confidential Information” means, with respect to a Piggyback Registration, (i) Baxalta’s plan to file the relevant
Registration Statement and engage in the offering so registered, (ii) any information regarding the offering being registered (including the potential timing, price, number of shares, underwriters or other counterparties, selling stockholders
or plan of distribution) and (iii) any other information (including information contained in draft supplements or amendments to offering materials) provided to any Holders by Baxalta (or by third parties) in connection with a Piggyback
Registration; provided, that Offering Confidential Information shall not include information that (x) was or becomes generally available to the public (including as a result of the filing of the relevant Registration Statement) other than as a
result of a disclosure by any Holder, (y) was or becomes available to any Holder from a source not bound by any confidentiality agreement with Baxalta or (z) was otherwise in such Holder’s possession prior to it being furnished to
such Holder by Baxalta or on Baxalta’s behalf. 
 “Other Holders” has the meaning set forth in Section 2.01(f). 

“Participating Banks” means such investment banks or other Persons that are not part of the Baxter Group that engage in any Exchange with one
or more members of the Baxter Group. 

  
 -3- 

 “Permitted Transferee” means any Transferee, any Subsequent Transferee and, for the limited
purposes set forth in Section 4.06(b), any Limited Transferee. 
 “Person” means an individual, a general or limited
partnership, a corporation, a trust, a joint venture, an unincorporated organization, a limited liability entity, any other entity and any Governmental Authority. 

“Piggyback Registration” has the meaning set forth in Section 2.02(a). 

“Private Exchange” means a private exchange pursuant to which one or more members of the Baxter Group shall Sell some or all of their
Registrable Securities to one or more Participating Banks in exchange, directly or indirectly, for any equity interest of Baxter or the satisfaction of Debt, in a transaction or series of transactions not required to be registered under the
Securities Act. 
 “Prospectus” means the prospectus included in any Registration Statement, all amendments and supplements to such
prospectus, including post-effective amendments, and all other material incorporated by reference in such prospectus. 
 “Public Exchange”
means a public exchange pursuant to which one or more members of the Baxter Group shall Sell some or all of their Registrable Securities to one or more Participating Banks in exchange, directly or indirectly, for any equity interest of Baxter or the
satisfaction of Debt, in a transaction or series of transactions registered under the Securities Act. 
 “Registrable Securities” means the
Retained Shares and any shares of Common Stock or other securities issued with respect to, in exchange for, or in replacement of such Retained Shares; provided that the term “Registrable Securities” excludes any security
(i) the offering and Sale of which has been effectively registered under the Securities Act and which has been Sold in accordance with a Registration Statement, (ii) that has been Sold by a Holder in a transaction or transactions exempt
from the registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof (including transactions pursuant to Rule 144) such that the further Sale of such securities by the transferee or assignee is not
restricted under the Securities Act or (iii) that has been Sold by a Holder in a transaction in which such Holder’s rights under this Agreement are not, or cannot be, assigned. 

“Registration” means a registration with the SEC of the offer and Sale to the public of any Registrable Securities under a Registration
Statement. The terms “Register” and “Registering” shall have correlative meanings. 
 “Registration
Expenses” means all expenses incident to the Baxalta Group’s performance of or compliance with this Agreement, including all (i) registration, qualification and filing fees, (ii) fees and expenses of compliance with
securities or blue sky laws (including reasonable fees and disbursements of counsel in connection with blue sky qualifications within the United States of any Registrable Securities being registered), (iii) printing expenses, messenger,
telephone and delivery expenses, (iv) internal expenses of Baxalta Group (including all salaries and expenses of employees of members of Baxalta Group performing legal or accounting duties), (v) fees and disbursements of counsel for
Baxalta and customary fees and expenses for independent certified public accountants retained by the Baxalta Group (including the expenses of any comfort letters 

  
 -4- 

 
or costs associated with the delivery by Baxalta Group members’ independent certified public accountants of comfort letters customarily requested by underwriters) and (vi) fees and
expenses of listing any Registrable Securities on any securities exchange on which the shares of Common Stock are then listed and Financial Industry Regulatory Authority registration and filing fees; but excluding any fees or disbursements of any
Holder, all expenses incurred in connection with the printing, mailing and delivering of copies of any Registration Statement, any Prospectus, any other offering documents and any amendments and supplements thereto to any underwriters and dealers;
any underwriting discounts, fees or commissions attributable to the offer and Sale of any Registrable Securities, any fees and expenses of the underwriters or dealer managers, the cost of preparing, printing or producing any agreements among
underwriters, underwriting agreements and blue sky or legal investment memoranda, any selling agreements and any other similar documents in connection with the offering, Sale, distribution or delivery of the Registrable Securities or other shares of
Common Stock to be Sold, including any fees of counsel for any underwriters in connection with the qualification of the Registrable Securities or other shares of Common Stock to be Sold for offering and Sale or distribution under state securities
laws, any stock transfer taxes, out-of-pocket costs and expenses relating to any investor presentations on any “road show” presentations undertaken in connection with marketing of the Registrable Securities and any fees and expenses of any
counsel to the Holder or the underwriters or dealer managers. 
 “Registration Period” has the meaning set forth in Section 2.01(c).

 “Registration Rights” means the rights of the Holders to cause Baxalta to Register Registrable Securities pursuant to Article II.

 “Registration Statement” means any registration statement of Baxalta filed with, or as the context permits to be filed with, the SEC
under the rules and regulations promulgated under the Securities Act, including the related Prospectus, amendments and supplements to such registration statement, including post-effective amendments, and all exhibits and all material incorporated by
reference into such registration statement. For the avoidance of doubt, it is acknowledged and agreed that such Registration Statement may be on any form that shall be applicable, including Form S-1, Form S-3 or Form S-4 and may be a Shelf
Registration Statement. 
 “Retained Shares” has the meaning set forth in the recitals. 

“Sale” means the direct or indirect transfer, sale, assignment or other disposition of a security. The terms “Sell” and
“Sold” shall have correlative meanings. 
 “SEC” means the U.S. Securities and Exchange Commission. 

“Securities Act” means the U.S. Securities Act of 1933, as amended, and any successor thereto, and any rules and regulations promulgated
thereunder, all as the same shall be in effect from time to time. 
 “Separation and Distribution Agreement” has the meaning set forth in
the recitals. 

  
 -5- 

 “Shelf Registration Statement” means a Registration Statement of Baxalta for an offering of
Registrable Securities to be made on a delayed or continuous basis pursuant to Rule 415 under the Securities Act (or similar provisions then in effect). 

“Subsequent Transferee” has the meaning set forth in Section 4.06(b). 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, joint venture or partnership of which such Person
(i) beneficially owns, either directly or indirectly, more than fifty percent (50%) of (x) the total combined voting power of all classes of voting securities of such Person, (y) the total combined equity interests or
(z) the capital or profit interests, in the case of a partnership, or (ii) otherwise has the power to vote, either directly or indirectly, sufficient securities to elect a majority of the board of directors or similar governing body. 

“Transferee” has the meaning set forth in Section 4.06(b). 

“Underwritten Offering” means a Registration in which Registrable Securities are Sold to an underwriter or underwriters on a firm commitment
basis for reoffering to the public. 
 Section 1.02 Interpretation. 

In this Agreement, unless the context clearly indicates otherwise: 

(a) words used in the singular include the plural, and words used in the plural include the singular; 

(b) references to any Person include such Person’s successors and assigns but, if applicable, only if such successors and assigns are
permitted by this Agreement, and a reference to such Person’s “Affiliates” or “Subsidiaries” shall be deemed to mean such Person’s Affiliates or Subsidiaries, as applicable, following the Distribution; 

(c) any reference to any gender includes the other gender and the neuter; 

(d) the words “include,” “includes” and “including” shall be deemed to be followed by the words “without
limitation”; 
 (e) the words “shall” and “will” are used interchangeably and have the same meaning; 

(f) the word “or” shall have the inclusive meaning represented by the phrase “and/or”; 

(g) any reference to any Article, Section, Exhibit or Schedule means such Article or Section of, or such Exhibit or Schedule to, this
Agreement, as the case may be, and references in any Section or definition to any clause means such clause of such Section or definition; 

  
 -6- 

 (h) the words “herein,” “hereunder,” “hereof,” “hereto”
and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Section or other provision of this Agreement; 

(i) any reference to any agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented
and modified from time to time to the extent permitted by the provisions thereof and by this Agreement; 
 (j) any reference to any law
(including statutes and ordinances) means such law (including all rules and regulations promulgated thereunder) as amended, modified, codified or reenacted, in whole or in part, and in effect at the time of determining compliance or applicability;

 (k) relative to the determination of any period of time, “from” means “from and including,” “to” means
“to but excluding” and “through” means “through and including”; 
 (l) the table of contents and titles to
Articles and headings of Sections contained in this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of or to affect the meaning or interpretation of this Agreement; 

(m) any portion of this Agreement obligating a party to take any action or refrain from taking any action, as the case may be, shall mean that
such party shall also be obligated to cause its relevant Subsidiaries to take such action or refrain from taking such action, as the case may be; 

(n) the language of this Agreement shall be deemed to be the language the parties hereto have chosen to express their mutual intent, and no
rule of strict construction shall be applied against any party; and 
 (o) except as otherwise indicated, all periods of time referred to
herein shall include all Saturdays, Sundays and holidays; provided, however that if the date to perform the act or give any notice with respect to this Agreement shall fall on a day other than a Business Day, such act or notice may be
performed or given timely if performed or given on the next succeeding Business Day. 
 ARTICLE II 

Registration Rights 
 Section 2.01
Registration. 
 (a) Prior to the fifth anniversary of the Distribution Date, any Holder(s) of 10% or more of the then outstanding
Registrable Securities (and any Holders acting together which collectively hold 10% or more of the then outstanding Registrable Securities) (collectively, the “Initiating Holder”; provided that the 10% ownership threshold
shall not apply to any Holder that is a member of the Baxter Group) shall have the right to request that Baxalta file a Registration Statement, on behalf of itself or, in the case of the Baxter Group, on behalf of the Participating Banks, with the
SEC on the appropriate registration form for all or part of the Registrable Securities held 

  
 -7- 

 
by such Initiating Holder, by delivering a written request thereof to Baxalta specifying the number of shares of Registrable Securities such Initiating Holder wishes to register (a
“Demand Registration”). Baxalta shall (i) within five days of the receipt of a Demand Registration, give written notice of such Demand Registration to all Holders of Registrable Securities, (ii) use its reasonable best
efforts to prepare and file the Registration Statement as expeditiously as possible but in any event within 30 days of such request, and (iii) use its reasonable best efforts to cause the Registration Statement to become effective in respect of
each Demand Registration in accordance with the intended method of distribution set forth in the written request delivered by the Initiating Holder. Baxalta shall include in such Registration all Registrable Securities with respect to which Baxalta
receives, within the 10 days immediately following the receipt by the Holder(s) of such notice from Baxalta, a request for inclusion in the Registration from the Holder(s) thereof. Each such request from a Holder of Registrable Securities for
inclusion in the Registration shall also specify the aggregate amount of Registrable Securities proposed to be Registered. The Initiating Holder may request that the Registration Statement be on any appropriate form, including Form S-4 in the case
of an Exchange Offer or a Shelf Registration Statement, and Baxalta shall effect the Registration on the form so requested. 
 (b) The
Holder(s) may collectively make a total of five Demand Registration requests pursuant to Section 2.01(a) (including any exercise of rights to Demand Registration transferred pursuant to Section 4.06 and including any exercise
of rights to Demand Registration made pursuant to any registration rights agreement entered into pursuant to Section 2.05); provided that the Holder(s) may not make more than two Demand Registration requests in any 365-day period.
In addition, and notwithstanding anything to the contrary, the Baxter Group shall be permitted on a one-time basis to engage in up to four Private Exchanges within any nine-month period during the first twenty-four months following the date hereof,
and all Demand Registration requests made by the Participating Banks in such Private Exchanges pursuant to one or more registration rights agreements with Baxalta pursuant to Section 2.05 shall collectively count only as one Demand
Registration request (with such request date deemed to be the date of the first of the requests made pursuant to the applicable Private Exchanges) for purposes of the limitation on the number of Demand Registration requests set forth in the first
sentence of this Section 2.01(b) (it being understood that the Baxter Group shall be permitted to engage in additional Private Exchanges outside such nine-month period, but each Demand Registration request by the Participating Banks for
such Private Exchange pursuant to its registration rights agreement with Baxalta pursuant to Section 2.05 shall count as an additional Demand Registration request for purposes of the limitation on the number of Demand Registration
requests set forth in the first sentence of this Section 2.01(b)). 
 (c) Baxalta shall be deemed to have effected a
Registration for purposes of this Section 2.01 if the Registration Statement is declared effective by the SEC or becomes effective upon filing with the SEC and remains effective until the earlier of (i) the date when all Registrable
Securities thereunder have been Sold and (ii) 60 days from the effective date of the Registration Statement (or from the date the applicable Prospectus is filed with the SEC if Baxalta is satisfying a request for a Demand Registration by filing
a Prospectus under an effective Shelf Registration Statement) (the “Registration Period”). No Registration shall be deemed to have been effective if the conditions to closing specified in the underwriting agreement or dealer manager
agreement, if any, entered into in connection with such Registration are not satisfied by reason of a wrongful act, misrepresentation or breach of such 

  
 -8- 

 
applicable underwriting agreement or dealer manager agreement by any member of the Baxalta Group. If during the Registration Period, such Registration is interfered with by any stop order,
injunction or other order or requirement of the SEC or other Governmental Authority or the need to update or supplement the Registration Statement, the Registration Period shall be extended on a day-for-day basis for any period in which the Holders)
is unable to complete an offering as a result of such stop order, injunction or other order or requirement of the SEC or other Governmental Authority. 

(d) With respect to any Registration Statement, whether filed or to be filed pursuant to this Agreement, if Baxalta shall reasonably
determine, upon the advice of legal counsel, that maintaining the effectiveness of such Registration Statement or filing an amendment or supplement thereto (or, if no Registration Statement has yet been filed, filing such a Registration Statement)
would require the public disclosure of material nonpublic information concerning any transaction or negotiations involving Baxalta or any of its consolidated Subsidiaries that would materially interfere with such transaction or negotiations (a
“Disadvantageous Condition”), Baxalta may, for the shortest period reasonably practicable, and in any event for not more than 30 consecutive calendar days (a “Blackout Period”), notify the Holders whose offers and
Sales of Registrable Securities are covered (or to be covered) by such Registration Statement (a “Blackout Notice”) that such Registration Statement is unavailable for use (or will not be filed as requested). Upon the receipt of any
such Blackout Notice, the Holders shall forthwith discontinue use of the Prospectus contained in any effective Registration Statement; provided, that, if at the time of receipt of such Blackout Notice any Holder shall have Sold its
Registrable Securities (or have signed a firm commitment underwriting agreement with respect to the purchase of such shares) and the Disadvantageous Condition is not of a nature that would require a post-effective amendment to the Registration
Statement, then Baxalta shall use its commercially reasonable efforts to take such action as to eliminate any restriction imposed by federal securities laws on the timely delivery of such Registrable Securities. When any Disadvantageous Condition as
to which a Blackout Notice has been previously delivered shall cease to exist, Baxalta shall as promptly as reasonably practicable notify the Holders and take such actions in respect of such Registration Statement as are otherwise required by this
Agreement. The effectiveness period for any Demand Registration for which Baxalta has given notice of a Blackout Period shall be increased by the length of time of such Blackout Period. Baxalta shall not impose, in any 365-day period, Blackout
Periods lasting, in the aggregate, in excess of 60 calendar days. If Baxalta declares a Blackout Period with respect to a Demand Registration for a Registration Statement that has not yet been declared effective, (i) the Holders may by notice
to Baxalta withdraw the related Demand Registration request without such Demand Registration request counting against the number of Demand Registration requests permitted to be made under Section 2.01(b) and (ii) the Holders shall
not be responsible for any of Baxalta’s related Registration Expenses. 
 (e) If the Initiating Holder so indicates at the time of its
request pursuant to Section 2.01(a), such offering of Registrable Securities shall be in the form of an Underwritten Offering or an Exchange Offer, and Baxalta shall include such information in the written notice to the Holders required
under Section 2.01(a). In the event that the Initiating Holder intends to Sell the Registrable Securities by means of an Underwritten Offering or Exchange Offer, the right of any Holder to include Registrable Securities in such
registration shall be conditioned upon such Holder’s participation in such Underwritten Offering or Exchange Offer and the 

  
 -9- 

 
inclusion of such Holder’s Registrable Securities in the Underwritten Offering or the Exchange Offer to the extent provided herein. The Holders of a majority of the outstanding Registrable
Securities being included in any Underwritten Offering or Exchange Offer shall select the underwriter(s) in the case of an Underwritten Offering or the dealer manager(s) in the case of an Exchange Offer, provided that such underwriter(s) or dealer
manager(s) are reasonably acceptable to Baxalta. Baxalta shall be entitled to designate counsel for such underwriter(s) or dealer manager(s) (subject to their approval), provided that such designated underwriters’ counsel shall be a firm of
national reputation representing underwriters or dealer managers in capital markets transactions. 
 (f) If the managing underwriter or
underwriters of a proposed Underwritten Offering of Registrable Securities included in a Registration pursuant to this Section 2.01 inform(s) in writing the Holders participating in such Registration that, in its or their opinion, the
number of securities requested to be included in such Registration exceeds the number that can be Sold in such offering without being likely to have a significant adverse effect on the price, timing or distribution of the securities offered or the
market for the securities offered, the number of Registrable Securities to be included in such Registration shall be reduced to the maximum number recommended by the managing underwriter or underwriter and allocated pro rata among the Holders,
including the Initiating Holder, in proportion to the number of Registrable Securities each Holder has requested to be included in such Registration; provided, that the Initiating Holder may notify Baxalta in writing that the Registration
Statement shall be abandoned or withdrawn, in which event Baxalta shall abandon or withdraw such Registration Statement. In the event the Initiating Holder notifies Baxalta that such Registration Statement shall be abandoned or withdrawn, such
Holder shall not be deemed to have requested a Demand Registration pursuant to Section 2.01(a), and Baxalta shall not be deemed to have effected a Demand Registration pursuant to Section 2.01(b). If the amount of Registrable
Securities to be underwritten has not been limited in accordance with the first sentence of this Section 2.01(f), Baxalta and the holders of Common Stock or, if the Registrable Securities include securities other than Common Stock, the
holders of securities of the same class of those securities included in the Registrable Securities, in each case, other than the Holders (“Other Holders”), may include such securities for their own account or for the account of
Other Holders in such Registration if the underwriter(s) so agree and to the extent that, in the opinion of such underwriter(s), the inclusion of such additional amount will not adversely affect the offering of the Registrable Securities included in
such Registration. 
 Section 2.02 Piggyback Registrations. 

(a) Prior to the earlier to occur of the fifth anniversary of the Distribution Date or the date on which the Registrable Securities then held
by the Holder(s) represents less than 1% of Baxalta’s then-issued and outstanding Common Stock (or, if the Registrable Securities include securities other than Common Stock, less than 1% of Baxalta’s then-issued and outstanding securities
of the same class as the securities included in the Registrable Securities), if Baxalta proposes to file a Registration Statement (other than a Shelf Registration) or a Prospectus supplement filed pursuant to a Shelf Registration Statement under the
Securities Act with respect to any offering of such securities for its own account and/or for the account of any Other Holders (other than (i) a Registration under Section 2.01, (ii) a Registration pursuant to a Registration
Statement on Form S-8 or Form S-4 or similar form that relates to a transaction subject to Rule 

  
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145 under the Securities Act, (iii) any form that does not include substantially the same information, other than information relating to the selling holders or their plan of distribution,
as would be required to be included in a Registration Statement covering the sale of the Registrable Securities, (iv) in connection with any dividend reinvestment or similar plan, (v) for the sole purpose of offering securities to another
entity or its security holders in connection with the acquisition of assets or securities of such entity or any similar transaction or (vi) a Registration in which the only Common Stock being registered is Common Stock issuable upon conversion
of debt securities that are also being registered) (a “Baxalta Public Sale”), then, as soon as practicable, but in any event not less than 15 days prior to the proposed date of filing such Registration Statement, Baxalta shall give
written notice of such proposed filing to each Holder, and such notice shall offer such Holders the opportunity to Register under such Registration Statement such number of Registrable Securities as each such Holder may request in writing (a
“Piggyback Registration”). Subject to Section 2.02(b) and Section 2.02(c), Baxalta shall use its commercially reasonable efforts to include in a Registration Statement with respect to a Baxalta Public Sale
all Registrable Securities that are requested to be included therein within five Business Days after the receipt of any such notice; provided, however, that if, at any time after giving written notice of its intention to Register any
securities and prior to the effective date of the Registration Statement filed in connection with such Registration, Baxalta shall determine for any reason not to Register or to delay Registration of the Baxalta Public Sale, Baxalta may, at its
election, give written notice of such determination to each such Holder and, thereupon, (x) in the case of a determination not to Register, shall be relieved of its obligation to Register any Registrable Securities in connection with such
Registration, without prejudice, however, to the rights of any Holder to request that such Registration be effected as a Demand Registration under Section 2.01 and (y) in the case of a determination to delay Registration, shall be
permitted to delay Registering any Registrable Securities for the same period as the delay in Registering such other shares of Common Stock in the Baxalta Public Sale. No Registration effected under this Section 2.02 shall relieve
Baxalta of its obligation to effect any Demand Registration under Section 2.01. For purposes of clarification, Baxalta’s filing of a Shelf Registration Statement shall not be deemed to be a Baxalta Public Sale; provided,
however, that any prospectus supplement filed pursuant to a Shelf Registration Statement with respect to an offering of Baxalta’s Common Stock for its own account and/or for the account of any other Persons will be a Baxalta Public Sale
unless such offering qualifies for an exemption from the Baxalta Public Sale definition in this Section 2.02(a). 
 (b) In the
case of any Underwritten Offering, each Holder shall have the right to withdraw such Holder’s request for inclusion of its Registrable Securities in such Underwritten Offering pursuant to Section 2.02(a) at any time prior to the
execution of an underwriting agreement with respect thereto by giving written notice to Baxalta of such Holder’s request to withdraw and, subject to the preceding clause, each Holder shall be permitted to withdraw all or part of such
Holder’s Registrable Securities from a Piggyback Registration at any time prior to the effective date thereof. 
 (c) If the managing
underwriter or underwriters of any proposed Underwritten Offering of a class of Registrable Securities included in a Piggyback Registration informs Baxalta and each Holder in writing that, in its or their opinion, the number of securities of such
class that such Holder and any other Persons intend to include in such offering exceeds the number that can be Sold in such offering without being likely to have an adverse effect on the 

  
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price, timing or distribution of the securities offered or the market for the securities offered, then the securities to be included in such Registration shall be (i) first, all securities
of Baxalta and any other Persons (other than Baxalta’s executive officers and directors) for whom Baxalta is effecting the Registration, as the case may be, proposes to Sell, (ii) second, the number, if any, of Registrable Securities of
such class that, in the opinion of such managing underwriter or underwriters, can be Sold without having such adverse effect, with such number to be allocated pro rata among the Holders that have requested to participate in such Registration based
on the relative number of Registrable Securities of such class requested by such Holder to be included in such Sale, (iii) third, the number of securities of executive officers and directors of Baxalta for whom Baxalta is effecting the
Registration, as the case may be, with such number to be allocated pro rata among the executive officers and directors and (iv) fourth, any other securities eligible for inclusion in such Registration, allocated among the holders of such
securities in such proportion as Baxalta and those holders may agree. 
 (d) After a Holder has been notified of its opportunity to include
Registrable Securities in a Piggyback Registration, such Holder (i) shall treat the Offering Confidential Information as confidential information, (ii) shall not use any Offering Confidential Information for any purpose other than to
evaluate whether to include its Registrable Securities (or other shares of Common Stock) in such Piggyback Registration and (iii) shall not disclose any Offering Confidential Information to any Person other than such of its agents, employees,
advisors and counsel as have a need to know such Offering Confidential Information, and to cause such agents, employees, advisors and counsel to comply with the requirements of this Section 2.02(d); provided, that any such Holder
may disclose Offering Confidential Information if such disclosure is required by legal process, but such Holder shall cooperate with Baxalta to limit the extent of such disclosure through protective order or otherwise, and to seek confidential
treatment of the Offering Confidential Information. 
 Section 2.03 Registration Procedures. 

(a) In connection with Baxalta’s Registration obligations under Section 2.01 and Section 2.02, Baxalta shall use
its reasonable best efforts to effect such Registration to permit the offer and Sale of such Registrable Securities in accordance with the intended method or methods of distribution thereof as expeditiously as reasonably practicable, and in
connection therewith, Baxalta shall, and shall cause the members of the Baxalta Group to: 
 (i) prepare and file the
required Registration Statement, including all exhibits and financial statements and, in the case of an Exchange Offer, any document required under Rule 425 or Rule 165 with respect to such Exchange Offer (collectively, the “Ancillary
Filings”) required under the Securities Act to be filed therewith, and before filing with the SEC a Registration Statement or Prospectus, or any amendments or supplements thereto, (A) furnish to the underwriters or dealer managers, if
any, and to the Holders, copies of all documents prepared to be filed, which documents shall be subject to the review and comment of such underwriters or dealer managers and such Holders and their respective counsel, and provide such underwriters or
dealers managers, if any, and such Holders and their respective counsel reasonable time to review and comment thereon and (B) not file with the SEC any Registration Statement or Prospectus or amendments or supplements thereto or any Ancillary
Filing to which the Holders or the underwriters or dealer managers, if any, shall reasonably object; 

  
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 (ii) prepare and file with the SEC such amendments and post-effective amendments
to such Registration Statement and supplements to the Prospectus and any Ancillary Filing as may be reasonably requested by the participating Holders; 

(iii) promptly notify the participating Holders and the managing underwriters or dealer managers, if any, and, if requested,
confirm such advice in writing and provide copies of the relevant documents, as soon as reasonably practicable after notice thereof is received by any member of the Baxalta Group (A) when the applicable Registration Statement or any amendment
thereto has been filed or becomes effective, the applicable Prospectus or any amendment or supplement to such Prospectus has been filed, or any Ancillary Filing has been filed, (B) of any comments (written or oral) by the SEC or any request
(written or oral) by the SEC or any other Governmental Authority for amendments or supplements to such Registration Statement, such Prospectus or any Ancillary Filing, or for any additional information, (C) of the issuance by the SEC of any
stop order suspending the effectiveness of such Registration Statement, any order preventing or suspending the use of any preliminary or final Prospectus or any Ancillary Filing, or the initiation or threatening of any proceedings for such purposes,
(D) if, at any time, the representations and warranties (written or oral) in any applicable underwriting agreement or dealer manager agreement cease to be true and correct in all material respects and (E) of the receipt by any member of
the Baxalta Group of any notification with respect to the suspension of the qualification of the Registrable Securities for offering or Sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; 

(iv) (A) promptly notify each participating Holder and the managing underwriter(s) or dealer manager(s), if any, when Baxalta
becomes aware of the occurrence of any event as a result of which the applicable Registration Statement, the Prospectus included in such Registration Statement (as then in effect) or any Ancillary Filing contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements therein (in the case of such Prospectus and any preliminary Prospectus, in light of the circumstances under which they were made) not misleading, or if for any other reason it
shall be necessary during such time period to amend or supplement such Registration Statement, Prospectus or any Ancillary Filing in order to comply with the Securities Act, and (B) in either case, as promptly as reasonably practicable
thereafter, prepare and file with the SEC, and furnish without charge to each participating Holder and the underwriter(s) or dealer manager(s), if any, an amendment or supplement to such Registration Statement, Prospectus or Ancillary Filing that
will correct such statement or omission or effect such compliance; 
 (v) use its reasonable best efforts to prevent or
obtain the withdrawal of any stop order or other order suspending the use of any preliminary or final Prospectus; 

  
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 (vi) promptly (A) incorporate in a Prospectus supplement or post-effective
amendment such information as the managing underwriter(s) or dealer manager(s), if any, and the Holders agree should be included therein relating to the plan of distribution with respect to such Registrable Securities and (B) make all required
filings of such Prospectus supplement or post-effective amendment as soon as reasonably practicable after being notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment; 

(vii) furnish to each participating Holder and each underwriter or dealer manager, if any, without charge, as many conformed
copies as such Holder or underwriter or dealer manager may reasonably request of the applicable Registration Statement and any amendment or post-effective amendment thereto, including financial statements and schedules, but excluding all documents
and exhibits (i) incorporated therein by reference or (ii) that are available via the SEC’s EDGAR system; 

(viii) deliver to each participating Holder and each underwriter or dealer manager, if any, without charge, as many copies of
the applicable Prospectus (including each preliminary Prospectus) and any amendment or supplement thereto as such Holder or underwriter or dealer manager may reasonably request (it being understood that Baxalta consents to the use of such Prospectus
or any amendment or supplement thereto by each participating Holder and the underwriter(s) or dealer manager(s), if any, in connection with the offering and Sale of the Registrable Securities covered by such Prospectus or any amendment or supplement
thereto) and such other documents as such participating Holder or underwriter or dealer manager may reasonably request in order to facilitate the Sale of the Registrable Securities by such Holder or underwriter or dealer manager; 

(ix) on or prior to the date on which the applicable Registration Statement is declared effective or becomes effective, use its
reasonable best efforts to register or qualify, and cooperate with each participating Holder, the managing underwriter(s) or dealer manager(s), if any, and their respective counsel, in connection with the registration or qualification of, such
Registrable Securities for offer and Sale under the securities or “blue sky” laws of each state and other jurisdiction of the United States as any participating Holder or managing underwriter(s) or dealer manager(s), if any, or their
respective counsel reasonably request, and in any foreign jurisdiction mutually agreeable to Baxalta and the participating Holders, and do any and all other acts or things reasonably necessary or advisable to keep such registration or qualification
in effect for so long as such Registration Statement remains in effect and so as to permit the continuance of offers and Sales and dealings in such jurisdictions for so long as may be necessary to complete the distribution of the Registrable
Securities covered by the Registration Statement; provided that Baxalta will not be required to qualify generally to do business in any jurisdiction where it is not then so qualified, to take any action which would subject it to taxation or general
service of process in any such jurisdiction where it is not then so subject or conform its capitalization or the composition of its assets at the time to the securities or blue sky laws of any such jurisdiction; 

(x) in connection with any Sale of Registrable Securities that will result in such securities no longer being Registrable
Securities, cooperate with each participating Holder and the managing underwriter(s) or dealer manager(s), if any, to (A) facilitate the 

  
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timely preparation and delivery of certificates representing Registrable Securities to be Sold and not bearing any restrictive Securities Act legends and (B) register such Registrable
Securities in such denominations and such names as such participating Holder or the underwriter(s) or dealer manager(s), if any, may request at least two Business Days prior to such Sale of Registrable Securities; provided that Baxalta may satisfy
its obligations hereunder without issuing physical stock certificates through the use of the Depository Trust Company’s Direct Registration System; 

(xi) cooperate and assist in any filings required to be made with the Financial Industry Regulatory Authority and each
securities exchange, if any, on which any of Baxalta’s securities are then listed or quoted and on each inter-dealer quotation system on which any of Baxalta’s securities are then quoted, and in the performance of any due diligence
investigation by any underwriter or dealer manager (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of each such exchange, and use its reasonable best efforts
to cause the Registrable Securities covered by the applicable Registration Statement to be registered with or approved by such other Governmental Authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s) or dealer
manager(s), if any, to consummate the Sale of such Registrable Securities; 
 (xii) not later than the effective date of the
applicable Registration Statement, provide a CUSIP number for all Registrable Securities and provide the applicable transfer agent with printed certificates for the Registrable Securities which are in a form eligible for deposit with the Depository
Trust Company; provided, that Baxalta may satisfy its obligations hereunder without issuing physical stock certificates through the use of the Depository Trust Company’s Direct Registration System; 

(xiii) obtain for delivery to and addressed to each participating Holder and to the underwriter(s) or dealer manager(s), if
any, opinions from the general counsel or deputy general counsel for Baxalta, in each case dated the effective date of the Registration Statement or, in the event of an Underwritten Offering, the date of the closing under the underwriting agreement
or, in the event of an Exchange Offer, the date of the closing under the dealer manager agreement or similar agreement or otherwise, and in each such case in customary form and content for the type of Underwritten Offering or Exchange Offer, as
applicable; 
 (xiv) in the case of an Underwritten Offering or Exchange Offer, obtain for delivery to and addressed to
Baxalta and the managing underwriter(s) or dealer manager(s), if any, and, to the extent requested, each participating Holder, a cold comfort letter from Baxalta’s independent registered public accounting firm in customary form and content for
the type of Underwritten Offering or Exchange Offer, dated the date of execution of the underwriting agreement or dealer manager agreement or, if none, the date of commencement of the Exchange Offer, and brought down to the closing, whether under
the underwriting agreement or dealer manager agreement, if applicable, or otherwise; 

  
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 (xv) in the case of an Exchange Offer that does not involve a dealer manager,
provide to each participating Holder such customary written representations and warranties or other covenants or agreements as may be requested by any participating Holder comparable to those that would be included in an underwriting or dealer
manager agreement; 
 (xvi) use its reasonable best efforts to comply with all applicable rules and regulations of the SEC
and make generally available to its security holders, as soon as reasonably practicable, but in any event no later than 90 days, after the end of the 12-month period beginning with the first day of Baxalta’s first quarter commencing after the
effective date of the applicable Registration Statement, an earnings statement satisfying the provisions of Section 11(a) of the Securities Act and covering the period of at least 12 months, but not more than 18 months, beginning with the first
month after the effective date of the Registration Statement; 
 (xvii) provide and cause to be maintained a transfer agent
and registrar for all Registrable Securities covered by the applicable Registration Statement from and after a date not later than the effective date of such Registration Statement; 

(xviii) cause all Registrable Securities covered by the applicable Registration Statement to be listed on each securities
exchange on which any of Baxalta’s securities are then listed or quoted and on each inter-dealer quotation system on which any of Baxalta’s securities are then quoted; 

(xix) provide (A) each Holder participating in the Registration, (B) the underwriters (which term, for purposes of
this Agreement, shall include any Person deemed to be an underwriter within the meaning of Section 2(11) of the Securities Act), if any, of the Registrable Securities to be registered, (C) the Sale or placement agent therefor, if any,
(D) the dealer manager therefor, if any, (E) counsel for such Holder, underwriters, agent, or dealer manager and (F) any attorney, accountant or other agent or representative retained by such Holder or any such underwriter or dealer
manager, as selected by such Holder, in each case, the opportunity to participate in the preparation of such Registration Statement, each Prospectus included therein or filed with the SEC, and each amendment or supplement thereto; and for a
reasonable period prior to the filing of such Registration Statement, upon execution of a customary confidentiality agreement, make available for inspection upon reasonable notice at reasonable times and for reasonable periods, by the parties
referred to in clauses (A) through (F) above, all pertinent financial and other records, pertinent corporate and other documents and properties of the Baxalta Group that are available to Baxalta, and cause all of the Baxalta Group’s
officers, directors and employees and the independent public accountants who have certified its financial statements to make themselves available at reasonable times and for reasonable periods to discuss the business of Baxalta and to supply all
information available to Baxalta reasonably requested by any such Person in connection with such Registration Statement as shall be necessary to enable them to exercise their due diligence or other responsibility, subject to the foregoing;
provided, that in no event shall any member of the Baxalta Group be required to make available any information which the Board determines in good faith to be competitively sensitive or confidential.

  
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The recipients of such information shall coordinate with one another so that the inspection permitted hereunder will not unnecessarily interfere with the Baxalta Group’s conduct of business.
Each Holder agrees that information obtained by it as a result of such inspections shall be deemed confidential and shall not be used by it as the basis for any market transactions in the securities of Baxalta or its Affiliates unless and until such
information is made generally available to the public by Baxalta or such Affiliate or for any reason not related to the Registration of Registrable Securities; 

(xx) in the case of an Underwritten Offering or Exchange Offer registering 25% or more of the Retained Shares, cause the senior
executive officers of Baxalta to participate at reasonable times and for reasonable periods in the customary “road show” presentations that may be reasonably requested by the managing underwriter(s) or dealer manager(s), if any, and
otherwise to facilitate, cooperate with, and participate in each proposed offering contemplated herein and customary selling efforts related thereto, except to the extent that such participation materially interferes with the management of
Baxalta’s business; provided that the effectiveness period for any Demand Registration shall be increased on a day-for-day basis by the period of time that management cannot participate; 

(xxi) comply with all requirements of the Securities Act, Exchange Act and other applicable laws, rules and regulations, as
well as all applicable stock exchange rules; and 
 (xxii) take all other customary steps reasonably necessary or advisable
to effect the Registration and distribution of the Registrable Securities contemplated hereby. 
 (b) As a condition precedent to any
Registration hereunder, Baxalta may require each Holder as to which any Registration is being effected to furnish to Baxalta such information regarding the distribution of such securities and such other information relating to such Holder, its
ownership of Registrable Securities and other matters as Baxalta may from time to time reasonably request in writing. Each such Holder agrees to furnish such information to Baxalta and to cooperate with Baxalta as reasonably necessary to enable
Baxalta to comply with the provisions of this Agreement. 
 (c) Each Holder shall, as promptly as reasonably practicable, notify Baxalta, at
any time when a Prospectus is required to be delivered (or deemed delivered) under the Securities Act, of the occurrence of an event, of which such Holder has knowledge, relating to such Holder or its Sale of Registrable Securities thereunder
requiring the preparation of a supplement or amendment to such Prospectus so that, as thereafter delivered (or deemed delivered) to the purchasers of such Registrable Securities, such Prospectus will not contain an untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading. 

  
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 (d) Baxter agrees (on behalf of itself and each member of the Baxter Group), and any other Holder
agrees by acquisition of such Registrable Securities, that, upon receipt of any written notice from Baxalta of the occurrence of any event of the kind described in Section 2.03(a)(iv) such Holder will forthwith discontinue Sale of
Registrable Securities pursuant to such Registration Statement until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 2.03(a)(iv), or until such Holder is advised in writing by
Baxalta that the use of the Prospectus may be resumed, and if so directed by Baxalta, such Holder will deliver to Baxalta, at Baxalta’s expense, all copies of the Prospectus covering such Registrable Securities current at the time of receipt of
such notice. In the event Baxalta shall give any such notice, the period during which the applicable Registration Statement is required to be maintained effective shall be extended by the number of days during the period from and including the date
of the giving of such notice through the date when each seller of Registrable Securities covered by such Registration Statement either receives the copies of the supplemented or amended Prospectus contemplated by Section 2.03(a)(iv) or
is advised in writing by Baxalta that the use of the Prospectus may be resumed. 
 Section 2.04 Underwritten Offerings or Exchange Offers. 

(a) If requested by the managing underwriter(s) for any Underwritten Offering or dealer manager(s) for any Exchange Offer that is requested by
Holders pursuant to a Demand Registration under Section 2.01, Baxalta shall enter into an underwriting agreement or dealer manager agreement, as applicable, with such underwriter(s) or dealer manager(s) for such offering, such agreement
to be reasonably satisfactory in substance and form to Baxalta and the underwriter(s) or dealer manager(s) and, if Baxter Group is a participating Holder, to Baxter Group. Such agreement shall contain such representations and warranties by Baxalta
and such other terms as are generally prevailing in agreements of that type. Each Holder with Registrable Securities to be included in any Underwritten Offering or Exchange Offer by such underwriter(s) or dealer manager(s) shall enter into such
underwriting agreement or dealer manager agreement at the request of Baxalta, which agreement shall contain such reasonable representations and warranties by the Holder and such other reasonable terms as are generally prevailing in agreements of
that type. 
 (b) In the event of a Baxalta Public Sale involving an offering of Common Stock or other equity securities of Baxalta in an
Underwritten Offering (whether in a Demand Registration or a Piggyback Registration, whether or not the Holders participate therein), the Holders hereby agree, and, in the event of a Baxalta Public Sale of Common Stock or other equity securities of
Baxalta in an Underwritten Offering or an Exchange Offer, Baxalta shall agree, and it shall cause its executive officers and directors to agree, if requested by the managing underwriter or underwriters in such Underwritten Offering or by the Holder
or the dealer manager or dealer managers, in an Exchange Offer, not to effect any Sale or distribution (including any offer to Sell, contract to Sell, short Sale or any option to purchase) of any securities (except, in each case, as part of the
applicable Registration, if permitted hereunder) that are of the same type as those being Registered in connection with such public offering and Sale, or any securities convertible into or exchangeable or exercisable for such securities, during the
period beginning five days before, and ending 90 days (or such lesser period as may be permitted by Baxalta or the participating Holder(s), as applicable, or such managing underwriter or underwriters) after, the effective date of the Registration
Statement filed in connection with such Registration (or, if later, the date of the Prospectus), to the extent timely notified in writing by such selling Person or the managing underwriter or underwriters or dealer manager or dealer managers. The
participating Holders and Baxalta, as applicable, also agree to execute an 

  
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agreement evidencing the restrictions in this Section 2.04(b) in customary form, which form is reasonably satisfactory to Baxalta or the participating Holder(s), as applicable, and
the underwriter(s) or dealer manager(s), as applicable; provided that such restrictions may be included in the underwriting agreement or dealer manager agreement, if applicable. Baxalta may impose stop-transfer instructions with respect to
the securities subject to the foregoing restriction until the end of the required stand-off period. 
 (c) No Holder may participate in any
Underwritten Offering or Exchange Offer hereunder unless such Holder (i) agrees to Sell such Holder’s securities on the basis provided in any underwriting arrangements or dealer manager agreements approved by Baxalta or other Persons
entitled to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements, dealer manager agreements and other documents reasonably required under the terms of such
underwriting arrangements or dealer manager agreements or this Agreement. 
 Section 2.05 Registration Rights Agreement with Participating
Banks. 
 If one or more members of the Baxter Group decides to engage in a Private Exchange with one or more Participating Banks, Baxalta shall enter
into a registration rights agreement with the Participating Banks in connection with such Private Exchange on terms and conditions consistent with this Agreement (other than the voting provisions contained in Article III hereof) and reasonably
satisfactory to Baxalta and the Baxter Group. 
 Section 2.06 Registration Expenses Paid by Baxalta. 

In the case of any Registration of Registrable Securities required pursuant to this Agreement, Baxalta shall pay all Registration Expenses regardless of
whether the Registration Statement becomes effective; provided, however, that Baxalta shall not be required to pay for any expenses of any Registration begun pursuant to Section 2.01 if the Demand Registration request is
subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be Registered (in which case all participating Holders shall bear such expenses), unless the Holders of a majority of the Registrable Securities
agree to forfeit their right to one Demand Registration to which they have the right pursuant to Section 2.01(b). 
 Section 2.07
Indemnification. 
 (a) Baxalta agrees to indemnify and hold harmless, to the full extent permitted by law, each Holder whose shares
are included in a Registration Statement, such Holder’s Affiliates and their respective officers, directors, agents, advisors, employees and each Person, if any, who controls (within the meaning of the Securities Act or the Exchange Act) such
Holder, from and against any and all losses, claims, damages, liabilities (or actions or proceedings in respect thereof, whether or not such indemnified party is a party thereto) and expenses, joint or several (including reasonable costs of
investigation and legal expenses) (each, a “Loss” and collectively “Losses”) arising out of or based upon (i) any untrue or alleged untrue statement of a material fact contained in any Registration Statement
under which the offering and Sale of such Registrable Securities was Registered under the Securities Act (including any final or preliminary Prospectus contained therein or any amendment thereof or supplement thereto or any

  
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documents incorporated by reference therein), or any such statement made in any free writing prospectus (as defined in Rule 405 under the Securities Act) that Baxalta has filed or is required to
file pursuant to Rule 433(d) of the Securities Act or any Ancillary Filing, (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of a
Prospectus, preliminary Prospectus or free writing prospectus, in light of the circumstances under which they were made) not misleading; provided, that with respect to any untrue statement or omission or alleged untrue statement or omission made in
any Prospectus, the indemnity agreement contained in this paragraph shall not apply to the extent that any such liability or Loss results from or arises out of (A) the fact that a current copy of the Prospectus was not sent or given to the
Person asserting any such liability at or prior to the written confirmation of the Sale of the Registrable Securities concerned to such Person if it is determined by a court of competent jurisdiction in a final and non-appealable judgment that
Baxalta has provided such Prospectus and it was the responsibility of such Holder or its agents to provide such Person with a current copy of the Prospectus and such current copy of the Prospectus would have cured the defect giving rise to such
liability, (B) the use of any Prospectus by or on behalf of any Holder after Baxalta has notified such Person (x) that such Prospectus contains an untrue statement of a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (y) that a stop order has been issued by the SEC with respect to a Registration Statement or (z) that a
Disadvantageous Condition exists, or (C) information furnished in writing by such Holder or on such Holder’s behalf, in either case expressly for use in such Registration Statement, Prospectus, free writing prospectus or Ancillary Filing
relating to such Holder’s Registrable Securities. This indemnity shall be in addition to any liability Baxalta may otherwise have, including under the Separation and Distribution Agreement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Holder or any indemnified party and shall survive the Sale of such securities by such Holder. 

(b) Each participating Holder whose Registrable Securities are included in a Registration Statement agrees (severally and not jointly) to
indemnify and hold harmless, to the full extent permitted by law, Baxalta, its directors, officers, agents, advisors, employees and each Person, if any, who controls (within the meaning of the Securities Act and the Exchange Act) Baxalta from and
against any and all Losses (i) arising out of or based upon information furnished in writing by such Holder or on such Holder’s behalf, in either case expressly for use in a Registration Statement, Prospectus, free writing prospectus or
Ancillary Filing relating to such Holder’s Registrable Securities or (ii) resulting from (A) the fact that a current copy of the Prospectus was not sent or given to the Person asserting any such liability at or prior to the written
confirmation of the Sale of the Registrable Securities concerned to such Person if it is determined by a court of competent jurisdiction in a final and non-appealable judgment that it was the responsibility of such Holder or its agent to provide
such Person with a current copy of the Prospectus and such current copy of the Prospectus would have cured the defect giving rise to such liability, or (B) the use of any Prospectus by or on behalf of any Holder after Baxalta has notified such
Person (x) that such Prospectus contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were
made, not misleading, (y) that a stop order has been issued by the SEC with respect to a Registration Statement or (z) that a Disadvantageous Condition exists. This indemnity shall be in addition to any liability the

  
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participating Holder may otherwise have, including under the Separation and Distribution Agreement. In no event shall the liability of any participating Holder hereunder be greater in amount than
the dollar amount of the net proceeds received by such holder under the Sale of the Registrable Securities giving rise to such indemnification obligation. Such indemnity shall remain in full force and effect regardless of any investigation made by
or on behalf of Baxalta or any indemnified party. 
 (c) Any claim or action with respect to which a party (an “Indemnifying
Party”) may be obligated to provide indemnification to any Person entitled to indemnification hereunder (an “Indemnitee”) shall be subject to the procedures for indemnification set forth in Article IV of the Separation and
Distribution Agreement. 
 (d) If for any reason the indemnification provided for in Section 2.07(a) or
Section 2.07(b) is unavailable to an Indemnitee or insufficient to hold it harmless as contemplated by Section 2.07(a) or Section 2.07(b), then the Indemnifying Party shall contribute to the amount paid or payable
by the Indemnitee as a result of such Loss in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and the Indemnitee on the other hand. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Indemnifying Party or the Indemnitee and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. For the avoidance of doubt, the establishment of such relative fault, and any disagreements or disputes relating thereto,
shall be subject to Section 4.03. Notwithstanding anything in this Section 2.07(d) to the contrary, no Indemnifying Party (other than Baxalta) shall be required pursuant to this Section 2.07(d) to contribute any
amount in excess of the amount by which the net proceeds received by such Indemnifying Party from the Sale of Registrable Securities in the offering to which the Losses of the Indemnitees relate (before deducting expenses, if any) exceeds the amount
of any damages which such Indemnifying Party has otherwise been required to pay by reason of such untrue statement or omission. The parties hereto agree that it would not be just and equitable if contribution pursuant to this
Section 2.07(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in this Section 2.07(d). No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The amount paid or payable by an Indemnitee hereunder shall
be deemed to include, for purposes of this Section 2.07(d), any legal or other expenses reasonably incurred by such Indemnitee in connection with investigating, preparing to defend or defending against or appearing as a third party
witness in respect of, or otherwise incurred in connection with, any such loss, claim, damage, expense, liability, action, investigation or proceeding. If indemnification is available under this Section 2.07, the Indemnifying Parties
shall indemnify each Indemnitee to the full extent provided in Section 2.07(a) and Section 2.07(b) without regard to the relative fault of said Indemnifying Parties or Indemnitee. Any Holders’ obligations to contribute
pursuant to this Section 2.07(d) are several and not joint. 

  
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 Section 2.08 Reporting Requirements; Rule 144. 

Until the earlier of (a) the expiration or termination of this Agreement in accordance with its terms and (b) the date upon which the Baxter Group
ceases to own any Registrable Securities, Baxalta shall use its commercially reasonable efforts to be and remain in compliance with the periodic filing requirements imposed under the SEC’s rules and regulations, including the Exchange Act, and
any other applicable laws or rules, and thereafter shall timely file such information, documents and reports as the SEC may require or prescribe under Sections 13, 14 and 15(d), as applicable, of the Exchange Act so that Baxalta will qualify for
registration on Form S-3 and to enable the Baxter Group to Sell Registrable Securities without registration under the Securities Act consistent with the exemptions from registration under the Securities Act provided by (i) Rule 144 or
Regulation S under the Securities Act, as amended from time to time, or (ii) any similar SEC rule or regulation then in effect. From and after the date hereof through the earlier of the expiration or termination of this Agreement in accordance
with its terms and the date upon which the Baxter Group ceases to own any Registrable Securities, Baxalta shall forthwith upon request furnish any Holder (x) a written statement by Baxalta as to whether it has complied with such requirements
and, if not, the specifics thereof, (y) a copy of the most recent annual or quarterly report of Baxalta and (z) such other reports and documents filed by Baxalta with the SEC as such Holder may reasonably request in availing itself of an
exemption for the offering and Sale of Registrable Securities without registration under the Securities Act. 
 Section 2.09 Registration Rights
Covenant. 
 Baxalta covenants that it will not, and it will cause the members of the Baxalta Group not to, grant any right of registration under the
Securities Act relating to any of its shares of Common Stock or other securities to any Person other than pursuant to this Agreement, unless the rights so granted to another Person do not limit or restrict the right of the Holder(s) hereunder. 

ARTICLE III 
 Voting
Restrictions 
 Section 3.01 Voting of Baxalta Common Stock. 

(a) From the date of this Agreement and until the date that the Baxter Group ceases to own any Retained Shares, Baxter shall, and shall cause
each member of the Baxter Group to (in each case, to the extent that they own any Retained Shares), be present, in person or by proxy, at each and every Baxalta shareholder meeting, and otherwise to cause all Retained Shares owned by them to be
counted as present for purposes of establishing a quorum at any such meeting, and to vote or consent on any matter (including waivers of contractual or statutory rights), or cause to be voted or consented on any such matter, all such Retained Shares
in proportion to the votes cast by the other holders of Common Stock on such matter. 
 (b) From the date of this Agreement and until the
date that the Baxter Group ceases to own any Retained Shares, Baxter hereby grants, and shall cause each member of the Baxter Group (in each case, to the extent that they own any Retained Shares) to grant, an irrevocable proxy, which shall be deemed
coupled with an interest sufficient in law to support an irrevocable proxy to Baxalta or its designees, to vote, with respect to any matter (including waivers of 

  
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contractual or statutory rights), all Retained Shares owned by them, in proportion to the votes cast by the other holders of Common Stock on such matter; provided that (i) such proxy
shall automatically be revoked as to a particular Retained Share upon any Sale of such Retained Share from a member of the Baxter Group to a Person other than a member of the Baxter Group and (ii) nothing in this Section 3.01(b)
shall limit or prohibit any such Sale. 
 (c) Baxter acknowledges and agrees (on behalf of itself and each member of the Baxter Group) that
Baxalta will be irreparably damaged in the event any of the provisions of this Article III are not performed by Baxter in accordance with their terms or are otherwise breached. Accordingly, it is agreed that Baxalta shall be entitled to an
injunction to prevent breaches of this Article III and to specific enforcement of the provisions of this Article III in any action instituted in any court of the United States or any state having subject matter jurisdiction over such
action. 
 ARTICLE IV 

Miscellaneous 
 Section 4.01
Term. 
 This Agreement shall terminate upon the earlier of (a) five years after the Distribution Date, (b) the time at which all
Registrable Securities are held by Persons other than Holders and (c) the time at which all Registrable Securities have been Sold in accordance with one or more Registration Statements; provided, that the provisions of
Section 2.06 and Section 2.07 and this Article IV shall survive any such termination. 
 Section 4.02 Counterparts;
Entire Agreement; Corporate Power. 
 (a) This Agreement may be executed in one or more counterparts, all of which shall be considered
one and the same agreement, and shall become effective when one or more counterparts have been signed by each party and delivered to each other party. 

(b) This Agreement and the exhibit hereto contain the entire agreement between the parties with respect to the subject matter hereof,
supersedes all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter and there are no agreements or understandings between the parties with respect to such subject
matter other than those set forth or referred to herein. 
 (c) Baxter represents on behalf of itself and each other member of the Baxter
Group, and Baxalta represents on behalf of itself and each other member of the Baxalta Group, as follows: (i) each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in
order to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby, and (ii) this Agreement has been duly executed and delivered by it and constitutes a valid and binding agreement of it enforceable in
accordance with the terms hereof. 
 (d) Each party hereto acknowledges that it and each other party hereto may execute this Agreement by
facsimile, stamp or mechanical signature. Each party hereto expressly adopts and confirms each such facsimile, stamp or mechanical signature made in its respective name as 

  
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if it were a manual signature, agrees that it shall not assert that any such signature is not adequate to bind such party to the same extent as if it were signed manually and agrees that at the
reasonable request of any other party hereto at any time it shall as promptly as reasonably practicable cause this Agreement to be manually executed (any such execution to be as of the date of the initial date thereof). 

Section 4.03 Disputes. 
 (a) Any
dispute, controversy or claim arising out of or relating to this Agreement, including the validity, interpretation, breach or termination hereof (a “Dispute”), shall be resolved in accordance with the procedures set forth in Article
VII of the Separation and Distribution Agreement, which shall be the sole and exclusive procedures for the resolution of any such Dispute unless otherwise specified in this Agreement or in Article VII of the Separation and Distribution Agreement;
provided that the initial discussions and negotiations with respect to any such Dispute shall occur at the Transition Committee (as defined in the Separation and Distribution Agreement) without the requirement for the preceding steps
described in Article VII of the Separation and Distribution Agreement. 
 (b) This Agreement (and any claims or disputes arising out of or
related hereto or to the transactions contemplated hereby or to the inducement of any party to enter herein, whether for breach of contract, tortious conduct or otherwise and whether predicated on common law, statute or otherwise) shall be governed
by and construed and interpreted in accordance with the laws of the State of Delaware, irrespective of the choice of laws principles of the State of Delaware, including all matters of validity, construction, effect, enforceability, performance and
remedies. 
 (c) THE PARTIES EXPRESSLY WAIVE AND FOREGO ANY RIGHT TO TRIAL BY JURY. 

Section 4.04 Amendment. 
 No provisions of this
Agreement shall be deemed waived, amended, supplemented or modified by any party, unless such waiver, amendment, supplement or modification is in writing and signed by the authorized representative of Baxalta, if such waiver, amendment, supplement
or modification is sought to be enforced against Baxalta, or the Holders of a majority of the Registrable Securities, if such waiver, amendment, supplement or modification is sought to be enforced against a Holder. 

Section 4.05 Waiver of Default. 
 Waiver by any
party of any default by the other party of any provision of this Agreement shall not be deemed a waiver by the waiving party of any subsequent or other default, nor shall it prejudice the rights of such party. No failure or delay by any party in
exercising any right, power or privilege under this Agreement shall operate as a waiver thereof nor shall a single or partial exercise thereof prejudice any other or further exercise thereof or the exercise of any other right, power or privilege.

  
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 Section 4.06 Successors, Assigns and Transferees. 

(a) This Agreement and all provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Baxalta may assign this Agreement to any member of the Baxalta Group or at any time in connection with a sale or acquisition of Baxalta, whether by merger, consolidation, sale of all or substantially all of
Baxalta’s assets, or similar transaction, without the consent of the Holders; provided, that the successor or acquiring Person agrees in writing to assume all of Baxalta’s rights and obligations under this Agreement. Baxter may
assign this Agreement to any member of the Baxter Group or at any time in connection with a sale or acquisition of Baxter, whether by merger, consolidation, sale of all or substantially all of Baxter’s assets, or similar transaction, without
the consent of Baxalta. 
 (b) In connection with the Sale of Registrable Securities, Baxter may assign its Registration-related rights and
obligations under this Agreement relating to such Registrable Securities to the following transferees in such Sale: (i) a member of the Baxter Group to which Registrable Securities are Sold, (ii) one or more Participating Banks to which
Registrable Securities are Sold, (iii) the Baxter International Inc. and Subsidiaries Pension Plan or any other defined benefit plan of which Baxter is the sponsor to which Registrable Securities are Sold, (iv) any other transferee to
which Registrable Securities are Sold, if Baxalta provides prior written consent to the transfer of such Registration-related rights and obligations along with the Sale of Registrable Securities or (v) any other transferee to which Registrable
Securities are Sold, unless such Sale consists of Registrable Securities representing less than 1% of Baxalta’s then-issued and outstanding securities of the same class as the Registrable Securities and such Registrable Securities are eligible
for Sale pursuant to an exemption from the registration and prospectus delivery requirements of the Securities Act under Section 4(a) thereof (including transactions pursuant to Rule 144); provided, that in the case of clauses (i), (ii),
(iii), (iv) or (v), (x) Baxalta is given written notice prior to or at the time of such Sale stating the name and address of the transferee and identifying the securities with respect to which the Registration-related rights and
obligations are being Sold and (y) the transferee executes a counterpart in the form attached hereto as Exhibit A and delivers the same to Baxalta (any such transferee in such Sale, a “Transferee”). In connection with the Sale
of Registrable Securities, a Transferee or Subsequent Transferee (as defined below) may assign its Registration-related rights and obligations under this Agreement relating to such Registrable Securities to the following subsequent transferees:
(A) an Affiliate of such Transferee to which Registrable Securities are Sold, (B) any subsequent transferee to which Registrable Securities are Sold, if Baxalta provides prior written consent to the transfer of such Registration-related
rights and obligations along with the Sale of Registrable Securities or (C) any other subsequent transferee to which Registrable Securities are Sold, unless such Sale consists of Registrable Securities representing less than 1% of
Baxalta’s then-issued and outstanding securities of the same class as the Registrable Securities and such Registrable Securities are eligible for Sale pursuant to an exemption from the registration and prospectus delivery requirements of the
Securities Act under Section 4(a) thereof (including transactions pursuant to Rule 144); provided, that in the case of clauses (A), (B) or (C), (x) Baxalta is given written notice prior to or at the time of such Sale stating
the name and address of the subsequent transferee and identifying the securities with respect to which the Registration-related rights and obligations are being assigned and (y) the subsequent transferee executes a counterpart in the form
attached hereto as Exhibit A and delivers the same to Baxalta (any such subsequent transferee, a “Subsequent Transferee”). 

  
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 Section 4.07 Further Assurances. 

In addition to the actions specifically provided for elsewhere in this Agreement, each of the parties hereto shall use its commercially reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, all things reasonably necessary, proper or advisable on its part under applicable laws, regulations and agreements, to consummate and make effective the transactions
contemplated by this Agreement. 
 Section 4.08 Performance. 

Baxter shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement to be
performed by any member of the Baxter Group. Baxalta shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement to be performed by any member of the Baxalta Group. Each
party (including its permitted successors and assigns) further agrees that it shall (a) give timely notice of the terms, conditions and continuing obligations contained in this Section 4.08 to all of the other members of its Group
and (b) cause all of the other members of its Group not to take, or omit to take, any action which action or omission would violate or cause such party to violate this Agreement. 

Section 4.09 Notices. 
 All notices, requests,
claims, demands or other communications under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by e-mail (followed
by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses (or at such other address for a party as shall be specified
in such communication): 
 If to Baxter, to: 

Baxter International Inc. 
 One
Baxter Parkway 
 Deerfield, Illinois 60015 

Attention: General Counsel 

E-mail: general_counsel@baxter.com 
 If to
Baxalta, to: 
 Baxalta Incorporated 

One Baxter Parkway 
 Deerfield,
Illinois 60015 
 Attention: General Counsel 

E-mail: general_counsel@baxter.com 
 Any party
may, by notice to the other party, change the address and contact person to which any such notices are to be given. 

  
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 Section 4.10 Severability. 

If any provision of this Agreement or the application hereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid,
void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and
effect and shall in no way be affected, impaired or invalidated thereby. Upon such determination, the parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to effect the original intent of the
parties. 
 Section 4.11 No Reliance on Other Party. 

The parties hereto represent to each other that this Agreement is entered into with full consideration of any and all rights which the parties hereto may
have. The parties hereto have relied upon their own knowledge and judgment and have conducted such investigations they and their in-house counsel have deemed appropriate regarding this Agreement and their rights in connection with this Agreement.
The parties hereto are not relying upon any representations or statements made by any other party, or any such other party’s employees, agents, representatives or attorneys, regarding this Agreement, except to the extent such representations
are expressly set forth or incorporated in this Agreement. The parties hereto are not relying upon a legal duty, if one exists, on the part of any other party (or any such other party’s employees, agents, representatives or attorneys) to
disclose any information in connection with the execution of this Agreement or its preparation, it being expressly understood that no party hereto shall ever assert any failure to disclose information on the part of any other party as a ground for
challenging this Agreement or any provision hereof. 
 Section 4.12 Registrations, Exchanges. etc. 

Notwithstanding anything to the contrary that may be contained in this Agreement, the provisions of this Agreement shall apply to the full extent set forth
herein with respect to (a) any shares of Common Stock, now or hereafter authorized to be issued, (b) any and all securities of Baxalta into which the shares of Common Stock are converted, exchanged or substituted in any recapitalization or
other capital reorganization by Baxalta and (c) any and all securities of any kind whatsoever of Baxalta or any successor or permitted assign of Baxalta (whether by merger, consolidation, sale of assets or otherwise) which may be issued on or
after the date hereof in respect of, in conversion of, in exchange for or in substitution of, the shares of Common Stock, and shall be appropriately adjusted for any stock dividends, or other distributions, stock splits or reverse stock splits,
combinations, recapitalizations, mergers, consolidations, exchange offers or other reorganizations occurring after the date hereof. 
 Section 4.13
Mutual Drafting. 
 This Agreement shall be deemed to be the joint work product of the parties, and any rule of construction that a document shall be
interpreted or construed against a drafter of such document shall not be applicable. 
 [The remainder of this page has been left blank
intentionally.] 

  
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 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
authorized representatives as of the date first above written. 
  

			
	BAXTER INTERNATIONAL INC.
		
	By:		/s/ James K. Saccaro
			Name: James K. Saccaro
			Title: Corporate Vice President
	
	BAXALTA INCORPORATED
		
	By:		/s/ Robert J. Hombach
			Name: Robert J. Hombach
			Title: Corporate Vice President and Chief Financial Officer

 Exhibit A 

Form of 
 Agreement to be
Bound 
 THIS INSTRUMENT forms part of the Shareholder’s and Registration Rights Agreement (the “Agreement”), dated as of
June 30, 2015, by and between Baxter International Inc., a Delaware corporation (“Baxter”), and Baxalta Incorporated, a Delaware corporation. The undersigned hereby acknowledges having received a copy of the Agreement and
having read the Agreement in its entirety, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, hereby agrees that the terms and conditions of the Agreement binding
upon and inuring to the benefit of Baxter shall be binding upon and inure to the benefit of the undersigned and its successors and permitted assigns as if it were an original party to the Agreement. 

IN WITNESS WHEREOF, the undersigned has executed this instrument on this      day of
            , 20    . 
  

	
	(Signature of transferee)
	   

	Print name

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