DEF 14A of Abbott Laboratories, Mar 18, 2022

DEF 14A of Abbott Laboratories

Filed Mar 18, 2022 · FY20210001206774-22-000778

Open on EDGAR

  1. KEY FEATURES OF OUR EXECUTIVE COMPENSATION PROGRAM

    | Compensation Practice | | Abbott Policy | More Information On Page | | Compensation is Market-Based | Yes | Benchmark peers with investment profiles, operating characteristics, and employment and business markets similar to Abbott. Annual incentive plan goals are set to exceed market growth in relevant markets/business segments | 30-33 | | Compensation is Performance-Based | Yes | Short-term and long-term incentive awards are 100% performance based. Annual incentive plan goals are set to exceed market growth in relevant markets/business segments | 31-33 | | Double-Trigger Change in Control | Yes | Provide change in control benefits under double-trigger circumstances only | 66-67 | | Recoupment Policy | Yes | Forfeiture for misconduct provision in equity grants and recoup compensation when warranted | 51 | | Robust Share Ownership Guidelines | Yes | Require significant share ownership for officers and directors, and share retention requirements until guidelines are met | 27 and 50 | | Capped Incentive Awards | Yes | Incentive award payments are capped | 32 and 53 | | Independent Compensation Committee Consultant | Yes | Committee consultant performs no other work for Abbott | 22 | | Tax Gross Ups | No | No tax gross ups under our executive officer pay program | 49-50 | | Guaranteed Bonuses | No | No guaranteed bonuses | 31 | | Employment Contracts | No | No employment contracts | 65 | | Excessive Risk Taking | No | No highly leveraged incentive plans that encourage excessive risk taking | 52-53 | | Hedging of Company Shares | No | No hedging of Abbott shares is allowed | 51 and 53 | | Discounted Stock Options | No | No discounted stock options are allowed or granted | 52 |

  2. NOMINEES FOR ELECTION AS DIRECTORS

    NOMINEES FOR ELECTION AS DIRECTORS

  3. NOMINEES FOR ELECTION AS DIRECTORS

    | | ROBERT J. ALPERN, M. D. Director Since 2008 Age 71 Ensign Professor of Medicine and Physiology and Professor of Internal Medicine and Cellular and Molecular Physiology, and Former Dean of Yale School of Medicine |

  4. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  5. PROFESSIONAL BACKGROUND

    | ● | Ensign Professor of Medicine and Professor of Internal Medicine at Yale School of Medicine since June 2004. | | ● | Dean of Yale School of Medicine from June 2004 to January 2020. | | ● | Dean of The University of Texas Southwestern Medical Center from July 1998 to May 2004. | | ● | Served on the Board of Directors of Yale New Haven Hospital from October 2005 to January 2020. |

  6. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS AbbVie Inc., Tricida, Inc.

  7. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE As a result of his long-tenured leadership positions at the Yale School of Medicine and The University of Texas Southwestern Medical Center, and as a former Director on the Board of Yale New Haven Hospital, Dr. Alpern contributes valuable insights to the Board through his medical and scientific expertise and his knowledge of the health care environment and the scientific nature of Abbott’s key research and development initiatives.

  8. KEY QUALIFICATIONS AND EXPERTISE

    | | SALLY E. BLOUNT, PH. D. Director Since 2011 Age 60 President and Chief Executive Officer, Catholic Charities of the Archdiocese of Chicago, and Michael L. Nemmers Professor of Strategy and Former Dean of the J.L. Kellogg Graduate School of Management at Northwestern University |

  9. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  10. PROFESSIONAL BACKGROUND

    | ● | President and Chief Executive Officer and Board Member of Catholic Charities of the Archdiocese of Chicago since August 2020. | | ● | Michael L. Nemmers Professor of Strategy and Dean of the J.L. Kellogg Graduate School of Management at Northwestern University from 2010 to 2018. | | ● | Dean of the New York University Undergraduate College and Vice Dean of its Leonard N. Stern School of Business from 2004 to 2010. | | ● | Professor at the New York University Leonard School of Business from 2001 to 2010, and became the Abraham L. Gitlow Professor of Management in 2004. | | ● | Held academic posts at the University of Chicago’s Graduate School of Business from 1992 to 2001. | | ● | Serves on the Board of Directors of the Joyce Foundation. |

  11. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS Ulta Beauty, Inc. Having served as Dean of the J.L. Kellogg Graduate School of Management at Northwestern University and as Vice Dean and Dean of the Undergraduate College of New York University’s Leonard N. Stern School of Business, Ms. Blount provides Abbott’s Board with expertise on business organization, governance and business management matters.

  12. OTHER PUBLIC COMPANY BOARDS

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  13. OTHER PUBLIC COMPANY BOARDS

    | | ROBERT B. FORD Director Since 2019 Age 48 Chairman of the Board and Chief Executive Officer, Abbott Laboratories |

  14. OTHER PUBLIC COMPANY BOARDS

    | ● | Chairman of the Board and Chief Executive Officer of Abbott since December 2021. | | ● | President and Chief Executive Officer of Abbott from March 2020 to December 2021. | | ● | President and Chief Operating Officer of Abbott from 2018 to 2020. | | ● | Executive Vice President, Medical Devices of Abbott from 2015 to 2018. | | ● | Senior Vice President, Diabetes Care of Abbott from 2014 to 2015. | | ● | Held various leadership roles across Abbott’s Diagnostics, Nutrition, and Diabetes Care businesses in the U.S. and Latin America since joining Abbott in 1996. |

  15. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE As Abbott’s Chairman of the Board and Chief Executive Officer, and having previously held various leadership positions at Abbott, including Chief Operating Officer, where he was responsible for all of Abbott’s operating businesses, Mr. Ford contributes an extensive knowledge of the Company’s global operations, a wide breadth of experience in strategy and execution, and valuable insights into global healthcare markets.

  16. KEY QUALIFICATIONS AND EXPERTISE

    | | PAOLA GONZALEZ Director Since 2021 Age 50 Vice President and Treasurer, The Clorox Company |

  17. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  18. PROFESSIONAL BACKGROUND

    | ● | Vice President and Treasurer of The Clorox Company, a manufacturer and marketer of consumer and professional products, since January 2018. | | ● | Vice President of Finance, Household and Lifestyle Segments of Clorox from 2010 to 2017. | | ● | Vice President of Finance, Global Strategic Initiatives of Clorox from 2008 to 2010. | | ● | Held various leadership roles in finance across Clorox since joining Clorox in 1997. | | ● | Prior to Clorox, worked in finance for American Airlines in Latin America. |

  19. PROFESSIONAL BACKGROUND

    As Vice President and Treasurer of The Clorox Company, Ms. Gonzalez is responsible for treasury, investor relations and real estate matters, and through her prior financial roles in several of its businesses, has considerable experience providing financial leadership to a multinational public company with multiple businesses, contributing significant financial expertise and knowledge of financial statements, corporate finance and accounting matters.

  20. PROFESSIONAL BACKGROUND

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  21. PROFESSIONAL BACKGROUND

    | | MICHELLE A. KUMBIER Director Since 2018 Age 54 President, Turf & Consumer Products, Briggs & Stratton, LLC |

  22. PROFESSIONAL BACKGROUND

    | ● | Senior Vice President and President, Turf & Consumer Products of Briggs & Stratton, LLC, a manufacturer and marketer of engines and outdoor power equipment, since March 2022. | | ● | Senior Vice President and Chief Operating Officer of Harley-Davidson Motor Company, a motorcycle and related products manufacturer, from 2017 to 2020. | | ● | Senior Vice President of Motor Company Product and Operations of Harley-Davidson from 2015 to 2017. | | ● | Held various other executive roles across Harley-Davidson, from 1997 to 2015. | | ● | Held various positions at Kohler Company, maker of premium plumbing products, from 1986 to 1997. |

  23. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS Teledyne Technologies Incorporated, Tenneco Inc. In connection with Tenneco’s publicly announced agreement to be acquired by Apollo Funds, Ms. Kumbier would cease to be a Tenneco Director upon the acquisition closing.

  24. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE Having served in several executive roles at Harley-Davidson, Ms. Kumbier contributes extensive experience in the management of a multinational public company, including significant manufacturing, product development, business development and strategic planning experience.

  25. KEY QUALIFICATIONS AND EXPERTISE

    | | DARREN W. MCDEW Director Since 2019 Age 61 Retired General, United States Air Force, and Former Commander of U.S. Transportation Command |

  26. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  27. PROFESSIONAL BACKGROUND

    | ● | Four-star general who served for 36 years in the United States military before retiring in October 2018. | | ● | Commander, U.S. Transportation Command, the single manager for global air, land and sea transportation for the U.S. Department of Defense from 2015 to 2018. | | ● | Held various leadership roles across the U.S. Military, including Vice Director for Strategic Plans and Policy for the Joint Chiefs of Staff, Military Aide to the President, Director of Air Force Public Affairs, and Chief of Air Force Senate Liaison Division. | | ● | Serves on the Board of Directors of Rolls-Royce, North America, Inc., United Services Automobile Association, and Boys & Girls Club of America. |

  28. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS Parsons Corporation Through his extensive leadership in the U.S. Air Force, General McDew contributes significant experience managing large, complex global operations, including strategic planning, security and risk management, cybersecurity, and supply chain and infrastructure management.

  29. OTHER PUBLIC COMPANY BOARDS

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  30. OTHER PUBLIC COMPANY BOARDS

    | | NANCY MCKINSTRY Director Since 2011 Age 63 Chief Executive Officer and Chairman of the Executive Board, Wolters Kluwer N.V. |

  31. OTHER PUBLIC COMPANY BOARDS

    | ● | Chief Executive Officer and Chairman of the Executive Board of Wolters Kluwer N.V., a global information, software, and services provider, since September 2003, and a member of its Executive Board since June 2001. | | ● | Member of the European Round Table of Industrialists. | | ● | Serves on the Board of Directors of Russell Reynolds Associates and the Board of Overseers of Columbia Business School. | | ● | Served on the Board of Directors of Telefonaktiebolaget LM Ericsson from 2004 to 2012. |

  32. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS Accenture plc

  33. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE As the Chief Executive Officer and Chairman of the Executive Board of Wolters Kluwer N.V., Ms. McKinstry contributes global perspectives and management experience, including an understanding of key issues facing a multinational business such as Abbott’s.

  34. KEY QUALIFICATIONS AND EXPERTISE

    | | WILLIAM A. OSBORN Lead Independent Director Director Since 2008 Age 74 Retired Chairman and Chief Executive Officer, Northern Trust Corporation |

  35. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  36. PROFESSIONAL BACKGROUND

    | ● | Chairman of Northern Trust Corporation, a multibank holding company, from 1995 to 2009 and Chief Executive Officer from 1995 to 2008. | | ● | President of Northern Trust Corporation and The Northern Trust Company, a banking services company, from 2003 to 2006. | | ● | Served on the Board of Directors of Nicor, Inc. from 1999 to 2006. | | ● | Served on the Board of Directors of Tribune Company from 2001 to 2012. | | ● | Served on the Board of Directors of Caterpillar Inc. from 2000 to 2021. | | ● | Served on the Board of Directors of General Dynamics Corporation from 2009 to 2021. |

  37. PROFESSIONAL BACKGROUND

    Having served as the Chairman and Chief Executive Officer of Northern Trust Corporation, Mr. Osborn acquired broad experience in successfully overseeing complex global businesses operating in highly regulated industries, including oversight of financial, operational, and governance matters facing large public companies.

  38. PROFESSIONAL BACKGROUND

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  39. PROFESSIONAL BACKGROUND

    | | MICHAEL F. ROMAN Director Since 2021 Age 62 Chairman of the Board, President and Chief Executive Officer, 3M Company |

  40. PROFESSIONAL BACKGROUND

    | ● | Chairman of the Board, President and Chief Executive Officer of 3M Company, a global manufacturing and technology company, since May 2019. | | ● | Chief Executive Officer of 3M from July 2018 to May 2019. | | ● | Chief Operating Officer and Executive Vice President of 3M from July 2017 to June 2018 with direct responsibilities for 3M’s five business groups and its international operations. | | ● | Executive Vice President, Industrial Business Group of 3M from June 2014 to July 2017. | | ● | Senior Vice President, Business Development of 3M from May 2013 to June 2014. | | ● | Vice President and General Manager of Industrial Adhesives and Tapes Division of 3M from September 2011 to May 2013. |

  41. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS 3M Company

  42. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE As Chairman of the Board, President and Chief Executive Officer of 3M Company, Mr. Roman has extensive experience leading a multinational public company with multiple businesses, contributing significant manufacturing, supply chain, technology, and finance experience, as well as valuable insights into corporate strategy and risk management.

  43. KEY QUALIFICATIONS AND EXPERTISE

    | | DANIEL J. STARKS Director Since 2017 Age 67 Retired Chairman, President and Chief Executive Officer, St. Jude Medical, Inc. |

  44. PROFESSIONAL BACKGROUND

    PROFESSIONAL BACKGROUND

  45. PROFESSIONAL BACKGROUND

    | ● | Executive Chairman of the Board of St. Jude Medical, Inc., a medical device manufacturer, from January 2016 to January 2017, when Abbott completed its acquisition of St. Jude Medical. | | ● | Chairman, President and Chief Executive Officer of St. Jude Medical from 2004 until his retirement in January 2016. | | ● | President and Chief Operating Officer of St. Jude Medical from 2001 to 2004. | | ● | President and CEO, Cardiac Rhythm Management Business of St. Jude Medical from 1997 to 2001. |

  46. PROFESSIONAL BACKGROUND

    Having served as St. Jude Medical’s Executive Chairman and its Chairman, President and Chief Executive Officer, and having joined St. Jude Medical in 1996, Mr. Starks contributes not only comprehensive and critical knowledge of St. Jude Medical’s operations, but also extensive business and management experience operating a global public company in a highly regulated industry.

  47. PROFESSIONAL BACKGROUND

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  48. PROFESSIONAL BACKGROUND

    | | JOHN G. STRATTON Director Since 2017 Age 61 Executive Chairman, Frontier Communications Parent, Inc. |

  49. PROFESSIONAL BACKGROUND

    | ● | Executive Chairman of Frontier Communications Parent, Inc., a telecommunications company, since April 2021. | | ● | Executive Vice President and President of Global Operations of Verizon Communications Inc. from 2015 to 2018. | | ● | Executive Vice President and President of Global Enterprise and Consumer Wireline of Verizon from 2014 to 2015. | | ● | President of Verizon Enterprise Solutions from 2012 to 2014. | | ● | Chief Operating Officer and Executive Vice President of Verizon Wireless from 2010 to 2012. | | ● | Member of The President’s National Security Telecommunications Advisory Committee from 2012 to 2018. | | ● | Director of the Cellular Telecommunications Industry Association from 2015 to 2018. |

  50. OTHER PUBLIC COMPANY BOARDS

    OTHER PUBLIC COMPANY BOARDS Frontier Communications Parent, Inc., General Dynamics Corporation

  51. KEY QUALIFICATIONS AND EXPERTISE

    KEY QUALIFICATIONS AND EXPERTISE Through his executive leadership experience, Mr. Stratton contributes extensive business and management expertise operating a global public company such as Abbott, including valuable insights on corporate strategy and risk management. His service on the National Security Telecommunications Advisory Committee enables him to provide government perspective and experience in a highly regulated industry.

  52. KEY QUALIFICATIONS AND EXPERTISE

    | | GLENN F. TILTON Director Since 2007 Age 73 Retired Chairman, President and Chief Executive Officer, UAL Corporation |

  53. PEER, BOARD, AND COMMITTEE EVALUATIONS

    | DIRECTOR COMPENSATION |

  54. PEER, BOARD, AND COMMITTEE EVALUATIONS

    Mr. Ford is not compensated for serving on the Board or Board committees. Mr. White was not compensated for serving on the Board or Board committees during his tenure as Executive Chairman of the Board. Abbott’s remaining directors, who are all non-employee directors, are compensated for their service under the Abbott Laboratories Non-Employee Directors’ Fee Plan and the Abbott Laboratories 2017 Incentive Stock Program. The following table sets forth a summary of the non-employee directors’ 2021 compensation.

  55. PEER, BOARD, AND COMMITTEE EVALUATIONS

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Option Awards ($)(3) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(4) | All Other Compensation ($)(5) | Total ($) | | R. J. Alpern | $126,000 | $184,944 | $0 | $53,408 | $25,000 | $389,352 | | R. S. Austin | 146,000 | 184,944 | 0 | 0 | 25,000 | 355,944 | | S. E. Blount | 126,000 | 184,944 | 0 | 7,590 | 25,000 | 343,534 | | P. Gonzalez | 43,500 | 0 | 0 | 0 | 0 | 43,500 | | M. A. Kumbier | 132,000 | 184,944 | 0 | 0 | 0 | 316,944 | | E. M. Liddy | 50,333 | 0 | 0 | 0 | 0 | 50,333 | | D. W. McDew | 126,000 | 184,944 | 0 | 0 | 0 | 310,944 | | N. McKinstry | 144,667 | 184,944 | 0 | 0 | 5,000 | 334,611 | | P. N. Novakovic | 47,000 | 0 | 0 | 0 | 0 | 47,000 | | W. A. Osborn | 156,000 | 184,944 | 0 | 0 | 0 | 340,944 | | M. F. Roman | 88,000 | 184,944 | 0 | 0 | 0 | 272,944 | | D. J. Starks | 126,000 | 184,944 | 0 | 0 | 0 | 310,944 | | J. G. Stratton | 132,000 | 184,944 | 0 | 0 | 0 | 316,944 | | G. F. Tilton | 142,000 | 184,944 | 0 | 0 | 25,000 | 351,944 |

  56. PEER, BOARD, AND COMMITTEE EVALUATIONS

    | The amounts reported in this column represent the aggregate grant date fair value of the awards calculated in accordance with Financial Accounting Standards Board ASC Topic 718. Abbott determines the grant date fair value of stock unit awards by multiplying the number of restricted stock units granted by the average of the high and low market prices of an Abbott common share on the date of grant. In addition to the fees described in footnote 1, each non-employee director elected to the Board of Directors at the annual shareholders meeting receives vested restricted stock units having a value of $185,000 (rounded down) under the Abbott Laboratories 2017 Incentive Stock Program). In 2021, this was 1,499 units. The non-employee directors receive cash payments equal to the dividends paid on the shares covered by the units at the same rate as other shareholders. Upon termination, retirement from the Board, death, or a change in control of Abbott, a non-employee director will receive one common share for each restricted stock unit outstanding under the Incentive Stock Program. Each director is required to own, within five years of becoming a director, the number of Abbott shares having a fair market value equal to five times the annual director fees earned or paid in cash. All directors with five years tenure or more meet or exceed the guidelines. The following Abbott restricted stock units were outstanding as of December 31, 2021: R. J. Alpern, 33,879; R. S. Austin, 41,542; S. E. Blount, 27,139; M. A. Kumbier, 5,714; D. W. McDew, 3,473; N. McKinstry, 27,139; W. A. Osborn, 35,796; M. F. Roman, 1,499; D. J. Starks, 12,096; J. G. Stratton, 8,659; and G. F. Tilton, 37,526.(2) | | The following options were outstanding as of December 31, 2021: R. S. Austin, 64,718; E. M. Liddy, 58,861; N. McKinstry, 63,391; P. N. Novakovic, 81,381; and W. A. Osborn, 29,567.(3) | | The totals in this column include reportable interest credited under Abbott Laboratories Non-Employee Directors’ Fee Plan during the year.(4) | | Charitable contributions made by Abbott’s non-employee directors are eligible for a matching contribution (up to $25,000 annually). The amounts reported in this column represent charitable matching grant contributions.(5) |

  57. VALUE CREATION FOR SHAREHOLDERS

    | CHANGES BASED ON SHAREHOLDER FEEDBACK | | | ● Increased disclosure related to Abbott’s 2030 Sustainability Plan goals and linkage to executive pay ● Revised annual cash incentive plan goals and weighting ● Significantly increased disclosure related to payouts for both annual and long term incentives ● Changed performance-based restricted stock awards to vest only over a 3-year term with no more than one-third of the award vesting in any one year | ● Introduced new long-term incentive measures to reflect sustained performance over a three-year period ● Increased director share ownership guidelines ● Increased the target for vesting of performance restricted shares ● Updated our peer group to reflect increased size and complexity of business ● Implemented a strengthened recoupment policy |

  58. VALUE CREATION FOR SHAREHOLDERS

    | ABBOTT’S PEER GROUP FOR PAY AND COMPANY PERFORMANCE BENCHMARKING |

  59. VALUE CREATION FOR SHAREHOLDERS

    To determine the competitiveness of our compensation and benefit programs, the Committee, in consultation with its independent consultant, annually compares the level of compensation, pay practices, and our relative performance to those of peer companies. Our Compensation Committee reviewed our peer group in 2021 and determined that the existing peer group strikes the appropriate balance between size (revenue and market capitalization between approximately one-third and three-times Abbott’s), growth and return profiles, geographic breadth, and management and operating structure. This approach has been overwhelmingly supported by our investors during shareholder outreach. The peer group is summarized below, showing the primary characteristics for each company selected, including the Abbott business segment(s) represented by the peer company.

  60. Base Salary

    Base Salary Base salary targets are initially set using the median of the peer group as a benchmark. Base salaries then vary depending on the officer’s experience, expertise, and performance. The average base salary of our executive officers is approximately at the market median.

  61. Annual Incentive Plan

    Annual Incentive Plan Annual incentive targets are initially set using the median of the peer group as a benchmark. The targets may vary based on other factors, including internal pay comparisons. Further linkage to the market is achieved by setting targets that require our officers to exceed the anticipated growth of the market in which they compete in order to achieve a target payout of their annual incentives.

  62. Long-Term Incentive Plan (LTI)

    Long-Term Incentive Plan (LTI) To set annual LTI award guidelines, the Committee first reviews LTI grants made by peer companies to identify the competitive market range. Each year the guidelines are set at the appropriate level within the competitive market range based on Abbott’s relative performance, as described on pages 32 and 33. To recognize the continued growth focus of Abbott and to directly align the interests of executive officers with the interests of our shareholders, the Compensation Committee grants long-term incentive awards in the form of 50% stock options and 50% performance restricted shares. This mix of incentive awards is consistent with our peers.

  63. COMPENSATION OUTCOMES ARE PERFORMANCE-BASED

    COMPENSATION OUTCOMES ARE PERFORMANCE-BASED Other than base salary, which is the smallest component of our executives’ compensation, all remaining components of Total Direct Compensation (i.e., annual incentive, performance-based restricted stock awards, and stock options) are aligned with individual, business segment and Company performance.

  64. COMPENSATION OUTCOMES ARE PERFORMANCE-BASED

    | BASE SALARY | BONUS TARGET % | TOTAL GOAL SCORE | | AWARD PAYOUT | | $525,000x | 90%x | 95% | = | $448,875 |

  65. COMPENSATION OUTCOMES ARE PERFORMANCE-BASED

    For 2021 performance, annual incentive payouts for Abbott executive officers averaged 101% of target. For individual calculations for each named officer, see pages 38 to 48. The annual incentive plan is formula driven based on financial, strategic, talent and succession, and diversity results. Officer financial goals are based on adjusted financial measures that reflect the true results of our ongoing operations and are set based on the expected market growth of the businesses in the markets in which we compete.

  66. Long-Term Incentive Plan

    Long-Term Incentive Plan Abbott’s process to determine long-term incentive awards is based on both company and individual performance. Guidelines are set based on relative performance of the Company to peers. Those guidelines are adjusted, up or down, based on individual officer performance over the prior three years. Performance restricted shares vest only if performance achieves expectations over the following three years, and stock options provide value only through share price appreciation. Conversely, most other companies reflect performance only at the Company level through future relative TSR. Abbott’s process is much more rigorous, reflecting both company and individual performance over a longer period of time. The Committee positions LTI award guidelines relative to the market by comparing Abbott’s 3-year TSR performance against our peers. 5- and 1-year TSR performance are also referenced to ensure long-term performance is sustained, and current performance is on track with shareholder expectations.

  67. Long-Term Incentive Plan

    | 32 | |

  68. Long-Term Incentive Plan

    For example, guidelines for grants made in February 2021 were set at the 75th percentile of our peer group, reflecting 82nd percentile relative 3-, 5-, and 1-year TSR performance for the period ending in 2020, as summarized in the graphic below. The information below represents the February 2021 annual grant. STEP 1: Link to Market

  69. Compare Abbott’s 3-year TSR performance against our peer group, consider 5-, and 1-year TSR to ensure long-term performance is sustained

    Compare Abbott’s 3-year TSR performance against our peer group, consider 5-, and 1-year TSR to ensure long-term performance is sustained STEP 2: Link to Company Performance

  70. Position LTI guideline value relative to peer group

    Position LTI guideline value relative to peer group STEP 3: Link to Individual Performance

  71. Adjust for individual performance

    Adjust for individual performance 5-year relative TSR = 82% 3-year relative TSR = 82% 1-year relative TSR = 82% 2021 LTI Guideline = 75th percentile of Peer Group LTI LTI Award guideline adjusted up or down based on individual officer's sustained 3-year contributions to: ● Sales and market growth ● Margin ● Strategic financial measures The recommendation for each officer starts with the Company LTI award guideline (based on relative TSR performance and market data as described above) for the officer’s position and is adjusted based upon assessment of their sustained contributions over the last three years. Contribution scores are totaled and used to adjust each officer’s award guideline. Final awards may be increased or decreased based on the long-term impact each individual officer had on the organization. For example:

  72. Adjust for individual performance

    | SAMPLE INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | Metric | 2018 | 2019 | 2020 | Overall | | Sales and Market Growth Contribution | Met (0) | Did Not Meet (-1) | Exceeded (+1) | 0 | | Margin Contribution | Met (0) | Met (0) | Exceeded (+1) | +1 | | Strategic Financial Contribution | Met (0) | Met (0) | Met (0) | 0 | | | | | Total | +1 | | | | | LTI Adjustment | 110% |

  73. Adjust for individual performance

    | LTI ADJUSTMENT LEGEND | | | Total | Result | | +4 or More | 125% | | +1 to +3 | 110% | | 0 | 100% | | -1 or -2 | 90% | | -3 or Less | 75% |

  74. Adjust for individual performance

    Awards granted in 2021, based on individual officer performance for the three-year period ending in 2020, resulted in awards ranging from the 49th percentile to the 90th percentile of our peer group. For individual calculations for each named officer, see pages 38 to 48. Since stock options realize value only through share price appreciation, the value realized upon the exercise of vested stock options directly aligns the compensation earned with the value shareholders received over the same period. Options are also aligned with shareholder value through the impact of relative TSR in determining the LTI award guidelines. Performance restricted shares vest one-third each year only if the Adjusted Return on Equity (ROE) performance target is achieved. Vesting is absolute—either 100% or 0%. There is no partial vesting if the target is missed and no additional vesting upside if the Company over-performs. The Committee believes Adjusted ROE is the appropriate performance measure for vesting because ROE measures how much profit the Company generates over the long-term with the capital that shareholders have invested and is a measure reflecting deployment of capital or capital allocation. In 2021, the Adjusted ROE vesting target to determine future vesting was increased from 13% to 14%. This increase follows similar increases in prior years, which have increased this target 40% since 2014. This is consistent with our stated intent to increase our Adjusted ROE targets over time following the separation of AbbVie, which had a significant impact on our ROE and other return measures, including Return on Assets (ROA). Prior to the separation of Abbott and AbbVie, the AbbVie business accounted for the majority (65%) of Abbott’s adjusted net income. However, at the separation of AbbVie, Abbott retained the majority (90%) of the equity. While Abbott’s ROE was disproportionally lower following the AbbVie separation, shareholders that retained both their Abbott and AbbVie shares over the past eight years since the AbbVie separation would have seen a 322% appreciation in their holdings.

  75. COMPENSATION PROGRAM IS DIRECTLY LINKED TO BUSINESS STRATEGY

    | EVALUATION OF PERFORMANCE | | | METRIC | STRATEGIC LINK | | Our annual incentive plan is aligned to the following drivers of shareholder value: | | | Sales | Measures Abbott’s ability to compete effectively in the markets in which we participate and focuses management on achieving strong top-line growth, consistent with our business strategy. | | Diluted EPS | Measures Abbott’s ability to deliver profitable growth, contributing to strong shareholder returns. | | Return on Assets | Measures profitability and how effectively Company assets are used to generate profit. | | Free Cash Flow | Recognizes the importance of generating cash to fund ongoing investments in our business and to pay down debt, pay dividends, and fund investments outside of capital expenditures. | | Our long-term incentive plan relies on the following Company metrics, and 3-year sustained individual performance metrics, to determine award value: | | | Total Shareholder Return | Measures Abbott’s stock and dividend performance against our peer group. Used to position LTI award guidelines relative to the market. | | 3-year LTI Contribution Metrics | Measures how each officer has performed relative to their sales, margin, and strategic financial contribution goals. Used to adjust LTI award guidelines to reflect individual performance. | | Return on Equity | Measures how much profit Abbott generates over the long-term with the capital that shareholders have invested. Used to determine if performance-restricted awards vest. |

  76. Annual Incentive Plan

    Annual Incentive Plan Mr. Ford’s target bonus of 175% was not changed in 2021. Based on performance in 2021, Mr. Ford received a bonus in February 2022 which was calculated as follows:

  77. Annual Incentive Plan

    | GOAL | 2020 RESULTS ACHIEVED | GOAL WEIGHT | 2021 GOAL MEASUREMENT | | | 2021 RESULTS ACHIEVED | GOAL SCORE | | | | | THRESHOLD | TARGET | MAXIMUM | | | | FINANCIAL METRICS(1) | | | | | | | | | Adjusted Sales(2) | $34.92B | 25% | $42.99B | $43.19B | $44.20B | $43.61B | 30.2% | | Adjusted Diluted EPS | $3.65 | 25% | $4.93 | $5.00 | $5.25 | $5.21 | 35.5% | | Adjusted ROA | 11.8% | 10% | 14.9% | 15.0% | 15.5% | 15.9% | 15.0% | | Free Cash Flow | $5.7B | 10% | $6.9B | $7.2B | $7.6B | $8.6B | 15.0% | | STRATEGIC METRICS(3) | | | | | | | | | COVID-19 Test Sales | | 10% | 92.9% of target | Target | 114.3% of Target | 108.6% of Target | 13.1% | | Diabetes Care Sales Growth | | 10% | 89.1% of Target | Target | 108.7% of Target | 103.3% of Target | 11.9% | | Core Diagnostics Sales Growth | | 10% | 89.7% of Target | Target | 109.2% of Target | Below Threshold | 0.0% | | | | | | | | Total | 120.7% |

  78. Annual Incentive Plan

    | Adjusted Sales exclude the impact of foreign exchange on actual sales relative to the goal target. Adjusted Diluted EPS is diluted earnings per common share from continuing operations excluding specified items, such as intangible amortization expense and various other costs including expenses related to restructuring actions or business acquisitions. Adjusted Return on Assets (ROA) reflects earnings from continuing operations, excluding interest expense and specified items. Adjusted ROA also reflects total assets less current liabilities excluding short-term borrowings. Free Cash Flow equals Operating Cash Flow less acquisitions of property and equipment.(1) | | Set based on expected market growth of the businesses and markets in which we compete. To achieve target payout, must increase market share.(2) | | Target not disclosed for competitive reasons. Diabetes Care and Core Diagnostics Sales Growth exclude the impact of foreign exchange.(3) |

  79. Annual Incentive Plan

    | BASE SALARY | | BONUS TARGET % | | TOTAL GOAL SCORE | | AWARD PAYOUT | | $1,500,000 | × | 175% | × | 120.7% | = | $3,168,400 |

  80. Annual Incentive Plan

    | 38 | |

  81. Annual Incentive Plan

    Based on the Committee’s review of Abbott and individual performance through 2020, Mr. Ford received an LTI award in February 2021 with a value of $17,380,000, which was 110% of the market value equity award for a CEO in Abbott’s peer group. This award was paid 50% in stock options(1) and 50% in performance restricted shares(2).

  82. Annual Incentive Plan

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $15,800,000 | × | 110% | × | 50% Stock Options(1) | = | $8,690,000 | | | | | | 50% Performance Restricted Shares(2) | | $8,690,000 | | | | | | Total | | $17,380,000 |

  83. Annual Incentive Plan

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Margin Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Strategic Financial Contribution | Met (0) | Did Not Meet (-1) | Exceeded (+1) | 0 | | | | Total | | +6 | | Preliminary Adjustment | | | | 125% | | Impact(3) | | | | - | | LTI Adjustment | | | | 110% |

  84. Annual Incentive Plan

    | LTI ADJUSTMENT LEGEND | | | | | | PRELIMINARY ADJUSTMENT | | IMPACT | | | | TOTAL | RESULT | IMPACT ON BUSINESS PRIORITIES | SCORE | RESULT | | +4 or More | 125% | High Impact | ++ | +25% or More | | +1 to +3 | 110% | Medium/High Impact | + | Up to +25% | | 0 | 100% | Medium Impact | = | 0% | | -1 or -2 | 90% | Medium/Low Impact | - | Up to -25% | | -3 or Less | 75% | Low Impact | -- | -25% or More |

  85. Annual Incentive Plan

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) | | Individual LTI performance assessment was based upon Mr. Ford’s roles as Chief Operating Officer through March 31, 2020 and as President and Chief Executive Officer thereafter.(3) |

  86. Annual Incentive Plan

    | | 39 |

  87. Annual Incentive Plan

    | | ROBERT E. FUNCK, JR Executive Vice President, Finance and Chief Financial Officer |

  88. Annual Incentive Plan

    Mr. Funck’s annual base salary of $825,000 did not change in 2021.

  89. Annual Incentive Plan

    Annual Incentive Plan Mr. Funck’s target bonus of 115% was not changed in 2021. Based on performance in 2021, Mr. Funck received a bonus in February 2022 which was calculated as follows:

  90. Annual Incentive Plan

    | GOAL | 2020 RESULTS ACHIEVED | GOAL WEIGHT | 2021 GOAL MEASUREMENT | | | 2021 RESULTS ACHIEVED | GOAL SCORE | | | | | THRESHOLD | TARGET | MAXIMUM | | | | FINANCIAL METRICS(1) | | | | | | | | | Adjusted Sales(2) | $34.92B | 10% | $42.99B | $43.19B | $44.20B | $43.61B | 12.1% | | Adjusted Diluted EPS | $3.65 | 20% | $4.93 | $5.00 | $5.25 | $5.21 | 28.4% | | Free Cash Flow | $5.7B | 10% | $6.9B | $7.2B | $7.6B | $8.6B | 15.0% | | Achieve Key Treasury and Tax Metrics(3) | Achieved | 15% | Target | Target | Target | Achieved | 15.0% | | STRATEGIC METRICS(3) | | | | | | | | | Goal (10% weight): Execute milestones related to data asset management Result: Achieved | | | | | | | 10.0% | | Goal (10% weight): Implement a global guided buying platform Result: Partially Achieved | | | | | | | 5.0% | | Goal (10% weight): Implement key financial systems implementations within select countries Result: Achieved | | | | | | | 10.0% | | HUMAN CAPITAL METRICS | | | | | | | | | Goal (15% weight): Meet talent, succession planning, and diversity targets. Result: Achieved | | | | | | | 15.0% | | | | | | | | Total | 110.5% |

  91. Annual Incentive Plan

    | Adjusted Sales exclude the impact of foreign exchange on actual sales relative to the goal target. Adjusted Diluted EPS is diluted earnings per common share from continuing operations excluding specified items. Free Cash Flow equals Operating Cash Flow less acquisitions of property and equipment.(1) | | Set based on expected market growth of the businesses and markets in which we compete. To achieve target payout, must increase market share(2) | | Target not disclosed for competitive reasons.(3) |

  92. Annual Incentive Plan

    | BASE SALARY | | BONUS TARGET % | | TOTAL GOAL SCORE | | AWARD PAYOUT | | $825,000 | × | 115% | × | 110.5% | = | $1,048,400 |

  93. Annual Incentive Plan

    | 40 | |

  94. Annual Incentive Plan

    Based on the Committee’s review of Abbott and individual performance through 2020, Mr. Funck received an LTI award in February 2021 with a value of $6,000,000, which was equal to 113.2% of the market value equity award for a CFO in Abbott’s peer group. Additional calculation details are as follows:

  95. Annual Incentive Plan

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $5,300,000 | × | 113.2% | × | 50% Stock Options(1) | = | $3,000,000 | | | | | | 50% Performance Restricted Shares(2) | | $3,000,000 | | | | | | Total | | $6,000,000 |

  96. Annual Incentive Plan

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Margin Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Strategic Financial Contribution | Met (0) | Met (0) | Exceeded (+1) | +1 | | | | Total | | +7 | | Preliminary Adjustment | | | | 125% | | Impact(3) | | | | - | | LTI Adjustment | | | | 113.2% |

  97. Annual Incentive Plan

    | LTI ADJUSTMENT LEGEND | | | | | | PRELIMINARY ADJUSTMENT | | IMPACT | | | | TOTAL | RESULT | IMPACT ON BUSINESS PRIORITIES | SCORE | RESULT | | +4 or More | 125% | High Impact | ++ | +25% or More | | +1 to +3 | 110% | Medium/High Impact | + | Up to +25% | | 0 | 100% | Medium Impact | = | 0% | | -1 or -2 | 90% | Medium/Low Impact | - | Up to -25% | | -3 or Less | 75% | Low Impact | -- | -25% or More |

  98. Annual Incentive Plan

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) | | Individual LTI performance assessment was based upon Mr. Funck’s roles as Senior Vice President, Finance and Controller through February 29, 2020 and as Executive Vice President, Finance and Chief Financial Officer thereafter.(3) |

  99. Annual Incentive Plan

    | | 41 |

  100. Annual Incentive Plan

    | | HUBERT L. ALLEN Executive Vice President, General Counsel and Secretary |

  101. Annual Incentive Plan

    Mr. Allen’s annual base salary of $760,000 did not change in 2021.

  102. Annual Incentive Plan

    Annual Incentive Plan Mr. Allen’s target bonus of 105% was not changed in 2021. Based on performance in 2021, Mr. Allen received a bonus in February 2022 which was calculated as follows:

  103. Annual Incentive Plan

    | GOAL | 2020 RESULTS ACHIEVED | GOAL WEIGHT | 2021 GOAL MEASUREMENT | | | 2021 RESULTS ACHIEVED | GOAL SCORE | | | | | THRESHOLD | TARGET | MAXIMUM | | | | FINANCIAL METRICS(1) | | | | | | | | | Adjusted Sales(2) | $34.92B | 10% | $42.99B | $43.19B | $44.20B | $43.61B | 12.1% | | Adjusted Diluted EPS | $3.65 | 20% | $4.93 | $5.00 | $5.25 | $5.21 | 28.4% | | Free Cash Flow | $5.7B | 10% | $6.9B | $7.2B | $7.6B | $8.6B | 15.0% | | Other Financial Returns(3) | Achieved | 10% | Target | Target | Target | Achieved | 10.0% | | STRATEGIC METRICS | | | | | | | | | Goal (35% weight): Resolve certain key litigation matters and investigations. Result: Achieved | | | | | | | 35.0% | | HUMAN CAPITAL METRICS | | | | | | | | | Goal (15% weight): Meet talent, succession planning, and diversity targets. Result: Achieved | | | | | | | 15.0% | | | | | | | | Total | 115.5% |

  104. Annual Incentive Plan

    | Adjusted Sales exclude the impact of foreign exchange on actual sales relative to the goal target. Adjusted Diluted EPS is diluted earnings per common share from continuing operations excluding specified items. Free Cash Flow equals Operating Cash Flow less acquisitions of property and equipment.(1) | | Set based on expected market growth of the businesses and markets in which we compete. To achieve target payout, must increase market share(2) | | Target not disclosed for competitive reasons.(3) |

  105. Annual Incentive Plan

    | BASE SALARY | | BONUS TARGET % | | TOTAL GOAL SCORE | | AWARD PAYOUT | | $760,000 | × | 105% | × | 115.5% | = | $921,700 |

  106. Annual Incentive Plan

    | 42 | |

  107. Annual Incentive Plan

    Based on the Committee’s review of Abbott and individual performance through 2020, Mr. Allen received an LTI award in February 2021 with a value of $4,231,250, which was equal to 125% of his LTI award guideline. Additional calculation details are as follows:

  108. Annual Incentive Plan

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $3,385,000 | × | 125% | × | 50% Stock Options(1) | = | $2,115,625 | | | | | | 50% Performance Restricted Shares(2) | | $2,115,625 | | | | | | Total | | $4,231,250 |

  109. Annual Incentive Plan

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Margin Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Strategic Financial Contribution | Met (0) | Met (0) | Met (0) | 0 | | | | Total | | +6 | | LTI Adjustment | | | | 125% |

  110. Annual Incentive Plan

    | LTI ADJUSTMENT LEGEND | | | TOTAL | RESULT | | +4 or More | 125% | | +1 to +3 | 110% | | 0 | 100% | | -1 or -2 | 90% | | -3 or Less | 75% |

  111. Annual Incentive Plan

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) |

  112. Annual Incentive Plan

    | | 43 |

  113. Annual Incentive Plan

    | | DANIEL G. SALVADORI Executive Vice President and Group President, Established Pharmaceuticals and Nutritional Products |

  114. Annual Incentive Plan

    Mr. Salvadori previously served as Executive Vice President, Nutritional Products. Mr. Salvadori was appointed to the role of Executive Vice President and Group President, Established Pharmaceuticals and Nutritional Products effective December 1, 2021.

  115. Annual Incentive Plan

    Annual Incentive Plan Mr. Salvadori’s target bonus of 115% was not changed in 2021. Based on performance in 2021, Mr. Salvadori received a bonus in February 2022 which was calculated as follows:

  116. Annual Incentive Plan

    | | 2020 RESULTS | GOAL | 2021 GOAL MEASUREMENT | | | 2021 RESULTS | GOAL | | GOAL | ACHIEVED | WEIGHT | THRESHOLD | TARGET | MAXIMUM | ACHIEVED | SCORE | | FINANCIAL METRICS(1) | | | | | | | | | Adjusted Division Net Sales(2) | $7.68B | 20% | $7.79B | $7.88B | $7.98B | $8.14B | 30.0% | | Adjusted Division Margin(3) | — | 20% | Target | Target | 103.6% of Target | 102.6% of Target | 27.2% | | Adjusted Division Gross Margin(3) | — | 5% | 99.4% of Target | Target | 103.8% of Target | 97.3% of Target | 0% | | Gross Margin Improvement(3) | | 5% | Target | Target | 110.0% of Target | 101.2% of Target | 5.3% | | Market Share(3) | — | 10% | Target | Target | Target | Mostly Achieved | 7.5% | | Adjusted Division Free Cash Flow(3) | — | 5% | Target | Target | 102.4% of Target | 108.4% of Target | 7.5% | | Cash Conversion Cycle(3) | — | 5% | 5 days over Target | Target | Target | 2 days under Target | 5.0% | | STRATEGIC METRICS | | | | | | | | | Goal (20% weight): Complete all commercialization milestones and implement key capital projects. Result: Achieved | | | | | | | 20.0% | | HUMAN CAPITAL METRICS | | | | | | | | | Goal (10% weight): Meet talent, succession planning, and diversity targets. Result: Achieved | | | | | | | 10.0% | | | | | | | | Total | 112.5 % |

  117. Annual Incentive Plan

    | Adjusted Division Net Sales exclude the impact of foreign exchange on actual Nutrition sales relative to the goal target. Adjusted Division Margin and Adjusted Division Gross Margin exclude the impact of foreign exchange on actual Nutrition division margin and gross margin relative to the respective goal target. Adjusted Division Free Cash Flow reflects Nutrition’s pre-tax operating cash flow less capital expenditures and excludes the impact of foreign exchange.(1) | | Set based on expected growth in Nutrition market. To achieve target payout, must increase market share(2) | | Target not disclosed for competitive reasons.(3) |

  118. Annual Incentive Plan

    | BASE SALARY | | BONUS TARGET % | | TOTAL GOAL SCORE | | AWARD PAYOUT | | $715,539 | × | 115% | × | 112.5% | = | $925,700 |

  119. Annual Incentive Plan

    | 44 | |

  120. Annual Incentive Plan

    Based on the Committee’s review of Abbott and individual performance through 2020, Mr. Salvadori received an LTI award in February 2021 with a value of $4,777,500, which was equal to 125% of his LTI award guideline. Additional calculation details are as follows:

  121. Annual Incentive Plan

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $3,822,000 | × | 125% | × | 50% Stock Options(1) | = | $2,388,750 | | | | | | 50% Performance Restricted Shares(2) | | $2,388,750 | | | | | | Total | | $4,777,500 |

  122. Annual Incentive Plan

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Margin Contribution | Met (0) | Exceeded (+1) | Exceeded (+1) | +2 | | Strategic Financial Contribution | Met (0) | Exceeded (+1) | Did Not Meet (-1) | 0 | | | | Total | | +5 | | LTI Adjustment | | | | 125% |

  123. Annual Incentive Plan

    | LTI ADJUSTMENT LEGEND | | | TOTAL | RESULT | | +4 or More | 125% | | +1 to +3 | 110% | | 0 | 100% | | -1 or -2 | 90% | | -3 or Less | 75% |

  124. Annual Incentive Plan

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) |

  125. Annual Incentive Plan

    | | 45 |

  126. Annual Incentive Plan

    | | ANDREA F. WAINER Executive Vice President, Rapid and Molecular Diagnostics |

  127. Annual Incentive Plan

    Ms. Wainer’s annual base salary was increased from $650,000 to $710,000 in March 2021.

  128. Annual Incentive Plan

    Annual Incentive Plan Ms. Wainer’s target bonus of 115% was not changed in 2021. Based on performance in 2021, Ms. Wainer received a bonus in February 2022 which was calculated as follows:

  129. Annual Incentive Plan

    | | 2020 RESULTS | GOAL | 2021 GOAL MEASUREMENT | | | 2021 RESULTS | GOAL | | GOAL | ACHIEVED | WEIGHT | THRESHOLD | TARGET | MAXIMUM | ACHIEVED | SCORE | | FINANCIAL METRICS(1) | | | | | | | | | Adjusted Division Net Sales(2) | $6.16B | 20% | $9.47B | $9.83B | $10.85B | $10.52B | 26.7% | | Adjusted Division Margin(3) | — | 20% | Target | Target | 120.0% of Target | 112.2% of Target | 26.1% | | Adjusted Division Gross Margin(3) | — | 5% | 98.1% of Target | Target | 120.0% of Target | 101.3% of Target | 5.2% | | Gross Margin Improvement(3) | | 5% | Target | Target | 120.0% of Target | Above Maximum | 7.5% | | Market Share(3) | — | 10% | Target | Target | Target | Achieved | 10.0% | | Adjusted Division Free Cash Flow(3) | — | 10% | Target | Target | 120.0% of Target | 114.6% of Target | 13.6% | | STRATEGIC METRICS | | | | | | | | | Goal (20% weight): Complete the necessary innovation, development, and expansion metrics per approved plans. Result: Mostly Achieved | | | | | | | 15.5% | | HUMAN CAPITAL METRICS | | | | | | | | | Goal (10% weight): Meet talent, succession planning, and diversity targets. Result: Mostly Achieved | | | | | | | 9.5% | | | | | | | | Total | 114.1% |

  130. Annual Incentive Plan

    | Adjusted Division Net Sales exclude the impact of foreign exchange on actual Rapid and Molecular Diagnostics sales relative to the goal target. Adjusted Division Margin and Adjusted Division Gross Margin exclude the impact of foreign exchange on actual Rapid and Molecular Diagnostics division margin and gross margin relative to the respective goal target. Adjusted Division Free Cash Flow reflects Rapid and Molecular Diagnostics’ pre-tax operating cash flow less capital expenditures and excludes the impact of foreign exchange. Given the significant fluctuations in demand for COVID-19 diagnostic tests during the year, Adjusted Division Net Sales target for 2021 was revised from $12.3 billion to $9.8 billion and other financial targets were determined based on that sales target.(1) | | Set based on expected growth in Rapid and Molecular Diagnostics market.(2) | | Target not disclosed for competitive reasons.(3) |

  131. Annual Incentive Plan

    | BASE SALARY | | BONUS TARGET % | | TOTAL GOAL SCORE | | AWARD PAYOUT | | $710,000 | × | 115% | × | 114.1% | = | $931,600 |

  132. Annual Incentive Plan

    | 46 | |

  133. Annual Incentive Plan

    Based on the Committee’s review of Abbott and individual performance through 2020, Ms. Wainer received an LTI award in February 2021 with a value of $4,777,500, which was equal to 125% of her LTI award guideline. Additional calculation details are as follows:

  134. Annual Incentive Plan

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $3,822,000 | × | 125% | × | 50% Stock Options(1) | = | $2,388,750 | | | | | | 50% Performance Restricted Shares(2) | | $2,388,750 | | | | | | Total | | $4,777,500 |

  135. Annual Incentive Plan

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Met (0) | Did Not Meet (-1) | Exceeded (+1) | 0 | | Margin Contribution | Exceeded (+1) | Did Not Meet (-1) | Exceeded (+1) | +1 | | Strategic Financial Contribution | Met (0) | Did Not Meet (-1) | Exceeded (+1) | 0 | | | | Total | | +1 | | Preliminary Adjustment | | | | 110% | | Impact | | | | + | | LTI Adjustment | | | | 125% |

  136. Annual Incentive Plan

    | LTI ADJUSTMENT LEGEND | | | | | | PRELIMINARY ADJUSTMENT | | IMPACT | | | | TOTAL | RESULT | IMPACT ON BUSINESS PRIORITIES | SCORE | RESULT | | +4 or More | 125% | High Impact | ++ | +25% or More | | +1 to +3 | 110% | Medium/High Impact | + | Up to +25% | | 0 | 100% | Medium Impact | = | 0% | | -1 or -2 | 90% | Medium/Low Impact | - | Up to -25% | | -3 or Less | 75% | Low Impact | -- | -25% or More |

  137. Annual Incentive Plan

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) |

  138. Annual Incentive Plan

    | | 47 |

  139. Annual Incentive Plan

    | | MILES D. WHITE Former Executive Chairman of the Board |

  140. Annual Incentive Plan

    Mr. White retired from Abbott on December 31, 2021.

  141. Long-term Incentives

    Long-term Incentives Based on the Committee’s review of Abbott and individual performance through 2020, Mr. White received an LTI award in February 2021 with a value of $11,000,000, which was equal to 110% of his LTI award guideline. Additional calculation details are as follows:

  142. Long-term Incentives

    | LTI AWARD GUIDELINE | | LTI ADJUSTMENT | | AWARD ALLOCATION | | AWARD VALUE | | $10,000,000 | × | 110% | × | 50% Stock Options(1) | = | $5,500,000 | | | | | | 50% Performance Restricted Shares(2) | | $5,500,000 | | | | | | Total | | $11,000,000 |

  143. Long-term Incentives

    | INDIVIDUAL LTI PERFORMANCE ASSESSMENT | | | | | | METRIC | 2018 | 2019 | 2020 | OVERALL | | Sales and Market Growth Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Margin Contribution | Exceeded (+1) | Exceeded (+1) | Exceeded (+1) | +3 | | Strategic Financial Contribution | Exceeded (+1) | Met (0) | Exceeded (+1) | +2 | | | | Total | | +8 | | Preliminary Adjustment | | | | 125% | | Impact(3) | | | | - | | LTI Adjustment | | | | 110% |

  144. Long-term Incentives

    | LTI ADJUSTMENT LEGEND | | | | | | PRELIMINARY ADJUSTMENT | | IMPACT | | | | TOTAL | RESULT | IMPACT ON BUSINESS PRIORITIES | SCORE | RESULT | | +4 or More | 125% | High Impact | ++ | +25% or More | | +1 or +3 | 110% | Medium/High Impact | + | Up to +25% | | 0 | 100% | Medium Impact | = | 0% | | -1 or -2 | 90% | Medium/Low Impact | - | Up to -25% | | -3 or Less | 75% | Low Impact | -- | -25% or More |

  145. Long-term Incentives

    | Stock options realize value only through share price appreciation.(1) | | Performance restricted shares vest only if the 14% Adjusted Return on Equity (ROE) performance target is achieved.(2) | | Individual LTI performance assessment was based upon Mr. White’s roles as Chairman and Chief Executive Officer through March 31, 2020 and as Executive Chairman thereafter.(3) |

  146. Long-term Incentives

    | 48 | |

  147. BENEFITS AND PERQUISITES

    | BENEFITS AND PERQUISITES | DESCRIPTION | | Change in Control Arrangements | Mr. White did not have an Abbott change in control agreement. The other named officers have Abbott change in control agreements, the purpose of which is to aid in retention and recruitment, encourage continued attention and dedication to assigned duties during periods involving a possible change in control of the Company, and protect the earned benefits of the officer against adverse changes resulting from a change in control. The level of payments provided under the agreements is established to be consistent with market practices as confirmed by data provided to the Committee by its independent compensation consultant. These arrangements are described in greater detail in the “Potential Payments Upon Termination or Change in Control” section of this proxy. | | Financial Planning | Named officers are eligible to receive up to $10,000 of fees annually associated with estate planning advice, tax preparation, and general financial planning. If an officer chooses to utilize this benefit, fees for services received up to the annual allocation are paid by the Company and are treated as imputed income to the officer, who then is responsible for payment of all taxes due on the fees paid by the Company. | | Company Automobile | Named officers are eligible for use of a Company-leased vehicle, with a lease term of 50 months. Seventy-five percent (75%) of the cost of the vehicle is imputed to the officer as income for federal income tax purposes. | | Company Aircraft | Non-business-related flights on corporate aircraft by Messrs. Ford and White are covered by time-sharing lease agreements, pursuant to which incremental costs associated with those flights are reimbursed by the executive to the Company in accordance with Federal Aviation Administration regulations. | | Disability Benefit | In addition to Abbott’s standard disability benefits, the U.S. named officers are eligible for a monthly long-term disability benefit, which is described in greater detail in the “Potential Payments Upon Termination or Change in Control” section of this proxy. |

  148. Compensation Committee

    | ● | Regular training on code of business conduct and policies and procedures is mandatory for all employees. | | ● | Compensation structure encourages employees to regard Abbott as a career employer, to consider the long-term impact of their decisions, and to align their interests with those of Abbott’s shareholders (e.g., equity awards that vest over multi-year periods, ten-year term on stock options, and retirement plans). | | ● | Annual benchmarking ensures performance achievement and incentive payout opportunities that are aligned with a peer group that reflects the size, investment profile, operating characteristics, and employment and business markets of Abbott. Appropriateness of this group is assessed annually by the Compensation Committee’s independent consultant and reviewed and approved by the Compensation Committee. Our selection criteria and peer companies are reported each year to our shareholders and have received favorable reviews. | | ● | Abbott’s annual incentive plan places an appropriate weighting on earnings achievement by balancing it with other factors, including key operational and strategic measures, disclosed to shareholders. Since earnings are a key component of stock price performance, this aspect of Abbott’s compensation plan promotes alignment with shareholder interests without creating duplication across incentive plans. | | ● | Abbott’s long term incentive plan focuses on longer-term operating performance and shareholder returns and awards 50% stock options and 50% performance based restricted stock. In 2021, roughly three-quarters of named officer total compensation was in the form of long-term equity incentives that can be earned or vest over multiple years. | | ● | Equity awards are made, and grant prices are set at the same time each year, at the Compensation Committee’s regularly scheduled meeting. In addition, Abbott does not reprice or backdate stock options, award discounted stock options, or immediately vest stock options or restricted stock. Equity awards are based on multiple performance factors and are set at competitive market levels, adjusted by Abbott’s long-term performance vs. our Board-approved peer group. Both executive and Director share ownership guidelines and share retention requirements promote alignment with shareholders. |

  149. Compensation Committee

    | ● | Abbott’s compensation program does not include features that could encourage excessive risk taking, such as over weighting toward annual incentives, highly leveraged payout curves, uncapped incentive award payments, unreasonable thresholds, or steep payout cliffs at certain levels that may encourage short term business decisions to meet payout criteria. | | ● | Abbott’s recoupment policy allows the Compensation Committee to seek recoupment of incentive compensation, forfeit existing awards or reduce future awards if it determines that a senior executive engaged in misconduct or failed in a supervisory capacity, resulting in a material violation of law or Abbott policy that caused significant financial harm to Abbott. | | ● | Abbott’s hedging policy prohibits directors and officers from entering into financial transactions designed to reduce the financial risk associated with owning Abbott shares. | | ● | Abbott’s pledging policy prohibits directors and officers from holding Abbott shares in a margin account, pledging Abbott shares, or securing obligations by assigning Abbott shares as collateral unless granted an exception by the Compensation Committee. |

  150. Compensation Committee

    | SUMMARY COMPENSATION TABLE |

  151. Compensation Committee

    | Name and Principal Position | Year | Salary | Stock Awards(2) | Option Awards(3) | Non-Equity Incentive Plan Compensation(4) | Change in Pension Value and Non-qualified Deferred Compensation Earnings(5) | All Other Compensation(6) | SEC Total | Total Without Change in Pension Value ($)(7) | | Robert B. Ford, | 2021 | $1,482,692 | $8,689,294 | $8,689,978 | $3,168,400 | $2,755,343 | $129,179 | $24,914,886 | $22,485,091 | | Chairman of the Board and Chief Executive Officer | 2020 | 1,298,462 | 5,623,995 | 5,624,993 | 3,675,000 | 4,150,264 | 77,872 | 20,450,586 | 16,549,550 | | | 2019 | 1,000,000 | 3,475,992 | 3,476,054 | 1,562,500 | 2,311,499 | 71,841 | 11,897,886 | 9,777,514 | | Robert E. Funck, Jr., | 2021 | 825,000 | 2,999,666 | 2,999,977 | 1,048,400 | 1,507,073 | 159,193 | 9,539,309 | 8,373,417 | | Executive Vice President, Finance and Chief Financial Officer | 2020 | 813,462 | 2,215,867 | 2,216,247 | 1,280,800 | 3,100,265 | 173,568 | 9,800,209 | 7,069,425 | | Hubert L. Allen, | 2021 | 760,000 | 2,115,332 | 2,115,612 | 921,700 | 768,954 | 172,158 | 6,853,756 | 6,395,592 | | Executive Vice President, General Counsel and Secretary | 2020 | 751,346 | 1,874,607 | 1,874,988 | 917,700 | 2,904,940 | 154,596 | 8,478,177 | 5,919,894 | | | 2019 | 710,000 | 2,199,962 | 2,199,990 | 879,700 | 1,429,523 | 66,905 | 7,486,080 | 6,386,933 | | Daniel G. Salvadori, | 2021 | 715,539 | 2,388,446 | 2,388,734 | 925,700 | 251,604 | 72,276 | 6,742,299 | 6,533,923 | | Executive Vice President and Group President, Established Pharmaceuticals and Nutritional Products | 2020 | 710,000 | 1,901,708 | 1,902,099 | 905,500 | 477,011 | 79,421 | 5,975,739 | 5,518,569 | | | 2019 | 704,923 | 2,351,989 | 2,351,986 | 903,400 | 395,710 | 59,806 | 6,767,814 | 6,388,821 | | Andrea F. Wainer, | 2021 | 699,616 | 2,388,446 | 2,388,734 | 931,600 | 772,906 | 69,112 | 7,250,414 | 6,564,595 | | Executive Vice President, Rapid and Molecular Diagnostics | | | | | | | | | | | Miles D. White,(1) | 2021 | 1,900,000 | 5,499,490 | 5,499,982 | 0 | 1,918,135 | 1,135,477 | 15,953,084 | 15,953,084 | | Former Executive Chairman of the Board | 2020 | 1,900,000 | 5,998,934 | 5,999,997 | 1,250,000 | 3,415,343 | 1,264,110 | 19,828,384 | 18,799,774 | | | 2019 | 1,900,000 | 7,562,448 | 7,562,499 | 4,405,625 | 5,707,836 | 664,409 | 27,802,817 | 24,675,423 |

  152. Compensation Committee

    | Mr. White retired from Abbott on December 31, 2021.(1) | | In accordance with the Securities and Exchange Commission’s rules, the amounts in this column represent the aggregate grant date fair value of the awards in accordance with Financial Accounting Standards Board ASC Topic 718. Abbott determines grant date fair value by multiplying the number of shares granted by the average of the high and low market prices of an Abbott common share on the award’s date of grant.(2) | | In accordance with the Securities and Exchange Commission’s rules, the amounts in this column represent the aggregate grant date fair value of the awards in accordance with Financial Accounting Standards Board ASC Topic 718. These amounts were determined as of the option’s grant date using a Black-Scholes stock option valuation model. These amounts are being reported solely for the purpose of comparative disclosure in accordance with the Securities and Exchange Commission’s rules. There is no certainty that the amount determined using a Black-Scholes stock option valuation model would be the value at which employee stock options would be traded for cash. The assumptions are the same as those described in Note 8, entitled “Incentive Stock Program” of Abbott’s Notes to Consolidated Financial Statements included under Item 8, “Financial Statements and Supplementary Data” in Abbott’s 2021 Annual Report on Securities and Exchange Commission Form 10-K.(3) | | This compensation is earned as a performance-based incentive bonus, pursuant to the 1998 Abbott Laboratories Performance Incentive Plan. Additional information regarding the Performance Incentive Plan can be found in the section of this proxy statement captioned, “Compensation Discussion and Analysis—Basis for Compensation Decisions.”(4) |

  153. Compensation Committee

    | 54 | |

  154. Compensation Committee

    | The plan amounts shown below are reported in this column.(5) | | For Messrs. Ford, Allen, Salvadori, and White, the amounts shown alongside the officer’s name are for 2021, 2020, and 2019, respectively. For Mr. Funck, Jr., the amounts shown are for 2021 and 2020, respectively. For Ms. Wainer, the amounts shown are for 2021. | | Abbott Laboratories Annuity Retirement Plan | | R. B. Ford: $22,149 / $142,819 / $176,268; R. E. Funck, Jr.: $89,455 / $256,555; H. L. Allen: $47,024 / $184,384 / $117,142; D. G. Salvadori: $19,272 / $45,483 / $41,282; A. F. Wainer: $34,273; and M. D. White: ($56,525) / $34,629 / $180,690. | | Abbott Laboratories Supplemental Pension Plan | | R. B. Ford: $2,407,646 / $3,758,217 / $1,944,104; R. E. Funck, Jr.: $1,076,437 / $2,474,229; H. L. Allen: $411,140 / $2,373,899 / $982,005; D. G. Salvadori: $189,104 / $411,687 / $337,711; A. F. Wainer: $651,546; and M. D. White: ($2,126,024) / $993,981 / $2,946,704. | | Non-Qualified Defined Contribution Plan Earnings | | The totals in this column include reportable interest credited under the 1998 Abbott Laboratories Performance Incentive Plan, the Abbott Laboratories 401(k) Supplemental Plan, and the 1986 Abbott Laboratories Management Incentive Plan (although none of the named officers currently receives awards under this plan). | | R. B. Ford: $325,548 / $249,228 / $191,127; R. E. Funck, Jr.: $341,181 / $369,481; H. L. Allen: $310,790 / $346,657 / $330,376; D. G. Salvadori: $43,228 / $19,841 / $16,717; A. F. Wainer: $87,087; and M. D. White: $1,918,135 / $2,386,733 / $2,580,442. | | The amounts shown below are reported in this column.(6) | | For Messrs. Ford, Allen, Salvadori, and White, the amounts shown alongside the officer’s name are for 2021, 2020, and 2019, respectively. For Mr. Funck, Jr., the amounts shown are for 2021 and 2020, respectively. For Ms. Wainer, the amounts shown are for 2021. | | Earnings on Non-Qualified Defined Contribution Plans (net of the reportable interest included in footnote 5). | | R. B. Ford: $8,148 / $8,116 / $0 ; R. E. Funck, Jr.: $86,107 / $106,106; H. L. Allen: $95,227 / $81,695 / $896; D. G. Salvadori: $3,566 / $1,701 / $0; A. F. Wainer: $2,162; and M. D. White: $799,031 / $926,052 / $105,715. | | Each of the named officers’ awards under the 1998 Abbott Laboratories Performance Incentive Plan is paid in cash to the officer on a current basis. Each of the named officers has a grantor trust into which the awards may be deposited, net of maximum tax withholdings. The named officers also have grantor trusts in connection with the Abbott Laboratories 401(k) Supplemental Plan and the 1986 Abbott Laboratories Management Incentive Plan (although none of the named officers currently receives awards under the Management Incentive Plan). These amounts include the trusts’ earnings (net of the reportable interest included in footnote 5). | | Employer Contributions to Defined Contribution Plans | | R. B. Ford: $74,135 / $64,924 / $50,000; R. E. Funck, Jr.: $41,250 / $40,673; H. L. Allen: $38,000 / $37,568 / $35,500; D. G. Salvadori: $35,777 / $35,500 / $35,247; A. F. Wainer: $34,981; and M. D. White: $95,000 / $95,000 / $95,000. | | These amounts include employer contributions to both Abbott’s tax-qualified defined contribution plan and the Abbott Laboratories 401(k) Supplemental Plan. The Abbott Laboratories 401(k) Supplemental Plan permits eligible Abbott officers to contribute amounts in excess of the limit set by the Internal Revenue Code for employee contributions to 401(k) plans up to the excess of (i) 18% of their base salary over (ii) the amount contributed to Abbott’s tax-qualified 401(k) plan. Abbott matches participant contributions at the rate of 250% of the first 2% of compensation contributed to the plan. The named officers have these amounts paid to them in cash on a current basis and deposited into a grantor trust established by the officer, net of maximum tax withholdings. |

  155. Compensation Committee

    | | 55 |

  156. Compensation Committee

    | Other Compensation | | Messrs. Ford’s and White’s non-business-related flights on corporate aircraft are covered by time-sharing lease agreements, pursuant to which they reimburse Abbott for certain costs associated with those flights in accordance with Federal Aviation Administration regulations. The following amounts are included in the totals in this column, which reflect Abbott’s incremental cost less reimbursements for non-business-related flights: R. B. Ford: $46,419 / $4,832 / $0; M. D. White: $0 / $10,792 / $226,633. | | Abbott determines the incremental cost for flights based on the direct cost to Abbott, including fuel costs, parking, handling and landing fees, catering, travel fees, and other miscellaneous direct costs. | | For Mr. White, the following costs associated with security less the amount reimbursed are included: $240,446 / $232,266 / $237,061. Abbott determines the cost for these expenses based on its actual costs. The security is provided on the recommendation of an independent security study. | | Also included in the totals shown in the table is the cost of providing a corporate automobile less the amount reimbursed by the officer: R. B. Ford: $0 / $0 / $21,841; R. E. Funck, Jr.: $22,661 / $20,319; H. L. Allen: $27,613 / $28,666 / $25,509; D. G. Salvadori: $21,933 / $26,773 / $24,559; and A. F. Wainer: $20,969. | | For Messrs. Funck, Jr., Allen, and Salvadori and Ms. Wainer, the following costs associated with financial planning are included: R. E. Funck, Jr.: $8,175 / $6,470; H. L. Allen: $10,000 / $6,667 / $5,000; D. G. Salvadori: $10,000 / $15,447 / $0; and A. F. Wainer: $10,000. For Mr. Salvadori, the 2020 amount includes payments for services incurred in 2020 and 2019. | | The totals shown in the table include other miscellaneous benefits in 2021: R. B. Ford: $477; R. E. Funck, Jr.: $1,000; H. L. Allen: $1,318; D. G. Salvadori: $1,000; A. F. Wainer: $1,000; and M. D. White: $1,000. | | The named officers are also eligible to participate in an executive disability benefit described on page 65. | | To demonstrate how year over year changes in pension value impact total compensation, as determined under SEC rules, we have included this column to show total compensation without pension value changes. The amounts reported in this column are calculated by subtracting the change in pension value reported in the Change in Pension Value and Non-qualified Deferred Compensation Earnings column, as described in footnote 5 to this table, from the amounts reported in the SEC Total column. The amounts reported in this column differ from, and are not a substitute for, the amounts reported in the SEC Total column.(7) |

  157. Compensation Committee

    | 56 | |

  158. Compensation Committee

    | 2021 GRANTS OF PLAN BASED AWARDS |

  159. Compensation Committee

    | 2021 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END |

  160. Compensation Committee

    | 2021 OPTION EXERCISES AND STOCK VESTED |

  161. Compensation Committee

    | PENSION BENEFITS |

  162. ANNUITY RETIREMENT PLAN

    ANNUITY RETIREMENT PLAN The Annuity Retirement Plan covers eligible employees in the United States who are age 21 or older, and provides participants with a life annuity benefit at normal retirement equal to A plus the greater of B or C below.

  163. ANNUITY RETIREMENT PLAN

    | A. | 1.10% of 5-year final average earnings multiplied by years of benefit service after 2003. | | B. | 1.65% of 5-year final average earnings multiplied by years of benefit service prior to 2004 (up to 20); plus 1.50% of 5-year final average earnings multiplied by years of benefit service prior to 2004 in excess of 20 (but no more than 15 additional years); less 0.50% of the lesser of 3-year final average earnings (but not more than the social security wage base in any year) or the social security covered compensation level multiplied by years of benefit service. | | C. | 1.10% of 5-year final average earnings multiplied by years of benefit service prior to 2004. |

  164. ANNUITY RETIREMENT PLAN

    The benefit for service prior to 2004 (B or C above) is reduced for the cost of preretirement surviving spouse benefit protection. The reduction is calculated using formulas based on age and employment status during the period in which coverage was in effect.

  165. ANNUITY RETIREMENT PLAN

    | | 61 |

  166. ANNUITY RETIREMENT PLAN

    Final average earnings are the average of the employee’s 60 highest paid consecutive calendar months of compensation (salary and non-equity incentive plan compensation). The Annuity Retirement Plan covers earnings up to the limit imposed by Internal Revenue Code Section 401(a)(17) and provides for a maximum of 35 years of benefit service. Participants become fully vested in their pension benefit upon the completion of five years of service. The benefit is payable on an unreduced basis at age 65. Participants hired after 2003 who terminate prior to age 55 with at least 10 years of service may choose to commence their benefits on an actuarially reduced basis as early as age 55. Participants hired prior to 2004 who terminate prior to age 50 with at least 10 years of service may choose to commence their benefits on an actuarially reduced basis as early as age 50. Participants hired prior to 2004 who terminate prior to age 50 with less than 10 years of service may choose to commence their benefits on an actuarially reduced basis as early as age 55. The Annuity Retirement Plan offers several optional forms of payment, including certain and life annuities, joint and survivor annuities, and level income annuities. The benefit paid under any of these options is actuarially equivalent to the life annuity benefit produced by the formula described above. Participants who retire from Abbott prior to their normal retirement age may receive subsidized early retirement benefits. Participants hired after 2003 are eligible for early retirement at age 55 with 10 years of service. Participants hired prior to 2004 are eligible for early retirement at age 50 with 10 years of service or age 55 if the employee’s age plus years of benefit service total 70 or more. As of December 31, 2021, Mr. Funck, Jr., Mr. Allen, and Ms. Wainer were eligible for early retirement benefits under the plan. The subsidized early retirement reductions applied to the benefit payable for service after 2003 (A above) depend upon the participant’s age at retirement. If the participant retires after reaching age 55, the benefit is reduced 5 percent per year for each year that payments are made before age 62. If the participant retires after reaching age 50 but prior to reaching age 55, the benefit is actuarially reduced from age 65. The early retirement reductions applied to the benefit payable for service prior to 2004 (B and C above) depend upon age and service at retirement:

  167. ANNUITY RETIREMENT PLAN

    | ● | In general, the 5-year final average earnings portions of the benefit are reduced 3 percent per year for each year that payments are made before age 62 and the 3-year final average earnings portion of the benefit is reduced 5 percent per year for each year that payments are made before age 62. | | ● | Employees who participated in the plan before age 36 may elect “Special Retirement” on the last day of any month after reaching age 55 with age plus Seniority Service points of at least 94 or “Early Special Retirement” on the last day of any month after reaching age 55, provided their age plus Seniority Service points would reach at least 94 before age 65. Seniority Service includes periods of employment prior to attaining the minimum age required to participate in the plan. If Special Retirement or Early Special Retirement applies, Seniority Service is used in place of benefit service in the formulas. The 5-year final average earnings portions of the benefit in B above are reduced 1⅔ percent for each year between ages 59 and 62 plus 2½ percent for each year between ages 55 and 59. The 3-year final average earnings portion of the benefit is reduced 5 percent per year for each year that payments are made before age 62. Benefit C is payable on an unreduced basis at Special Retirement and is reduced 3 percent per year for each year that payments are made before age 62, if Early Special Retirement applies. |

  168. ANNUITY RETIREMENT PLAN

    | 62 | |

  169. SUPPLEMENTAL PENSION PLAN

    SUPPLEMENTAL PENSION PLAN With the following exceptions, the provisions of the Supplemental Pension Plan are substantially the same as those of the Annuity Retirement Plan:

  170. SUPPLEMENTAL PENSION PLAN

    | ● | Officers’ 5-year final average earnings are calculated using the average of the 5 highest years of base earnings and the 5 highest years of payments under Abbott’s non equity incentive plans. | | ● | The Annuity Retirement Plan does not include amounts deferred or payments received under the Abbott Laboratories Deferred Compensation Plan in its calculation of a participant’s final average earnings. To preserve the pension benefits of Deferred Compensation Plan participants, the Supplemental Pension Plan includes amounts deferred by a participant under the Deferred Compensation Plan in its calculation of final average earnings. Beginning in the year following their election as an officer, Abbott officers are no longer eligible to defer compensation under the Deferred Compensation Plan. | | ● | In addition to the benefits outlined above for the Annuity Retirement Plan, participating officers are eligible for a benefit equal to 0.6% of 5-year final average earnings for each year of service for each of the first 20 years of service occurring after the participant attains age 35. The benefit is further limited by the maximum percentage allowed under the Annuity Retirement Plan under that plan’s benefit formulas (A, B, and C above). The portion of this additional officer benefit attributable to service prior to 2004 is reduced 3 percent per year for each year that payments are made before the plan’s unreduced retirement age. The portion attributable to service after 2003 is reduced 5 percent per year for each year that payments are made before the plan’s unreduced retirement age if the participant is at least age 55 at early retirement. If the participant is under age 55 at retirement, the portion attributable to service after 2003 is actuarially reduced from age 65. | | ● | The Supplemental Pension Plan provides early retirement benefits similar to those provided under the Annuity Retirement Plan. The benefits provided to Abbott’s officers under the Supplemental Pension Plan are reduced from the plan’s unreduced retirement age, unless the benefit is being actuarially reduced from age 65. As of December 31, 2021, Mr. Funck, Jr., Mr. Allen, and Ms. Wainer were eligible for early retirement benefits under the plan. | | ● | Vested plan benefits accrued under the Supplemental Pension Plan may be funded through a grantor trust established by the officer. Consistent with the distribution requirements of Internal Revenue Code Section 409A and its regulations, those officers who were elected prior to 2009 may have the entire amount of their vested plan benefits funded through a grantor trust. Officers elected after 2008 may only have the vested plan benefits that accrue following the calendar year in which the officer is first elected funded through a grantor trust. Vested plan benefits accrued through December 31, 2008, to the extent not previously funded, were distributed to the participants’ individual trusts and included in the participants’ income. |

  171. SUPPLEMENTAL PENSION PLAN

    Benefits payable under the Supplemental Pension Plan are offset by the benefits payable from the Annuity Retirement Plan, calculated as if benefits under the plans commenced at the same time. The amounts paid to an officer’s Supplemental Pension Plan grantor trust to fund plan benefits are actuarially determined. The plan is designed to result in Abbott paying the officer’s Supplemental Pension Plan benefits to the extent assets held in the officer’s trust are insufficient.

  172. SUPPLEMENTAL PENSION PLAN

    | | 63 |

  173. 2021 PENSION BENEFITS

    2021 PENSION BENEFITS

  174. 2021 PENSION BENEFITS

    | Name | Plan Name | Number of Years Credited Service (#) | Present Value of Accumulated Benefit ($)(1) | Payments During Last Fiscal Year ($) | | R. B. Ford | Abbott Laboratories Annuity Retirement Plan | 25 | $704,571 | $0 | | | Abbott Laboratories Supplemental Pension Plan | 25 | 10,291,116 | 667,730(2) | | R. E. Funck, Jr. | Abbott Laboratories Annuity Retirement Plan | 34 | 1,783,737 | 0 | | | Abbott Laboratories Supplemental Pension Plan | 34 | 9,129,556 | 1,272,406(2) | | H. L. Allen | Abbott Laboratories Annuity Retirement Plan | 16 | 633,478 | 0 | | | Abbott Laboratories Supplemental Pension Plan | 16 | 6,034,554 | 1,742,441(2) | | D. G. Salvadori | Abbott Laboratories Annuity Retirement Plan | 7 | 163,046 | 0 | | | Abbott Laboratories Supplemental Pension Plan | 7 | 1,283,304 | 50,339(2) | | A. F. Wainer | Abbott Laboratories Annuity Retirement Plan | 19 | 644,033 | 0 | | | Abbott Laboratories Supplemental Pension Plan | 19 | 2,779,623 | 275,528(2) | | M. D. White | Abbott Laboratories Annuity Retirement Plan | 37 | 1,661,405 | 0 | | | Abbott Laboratories Supplemental Pension Plan | 37 | 37,645,486 | 2,852,203(2) |

  175. 2021 PENSION BENEFITS

    | Abbott calculates these present values using: (i) a 3.17% discount rate for the Annuity Retirement Plan and a 3.07% discount rate for the Supplemental Pension Plan, the same effective discount rates it uses for Financial Accounting Standards Board ASC Topic 715 calculations for financial reporting purposes; and (ii) each plan’s unreduced retirement age. The present values shown in the table reflect post-retirement mortality, based on the Financial Accounting Standards Board ASC Topic 715 assumption (the Pri-2012 Healthy Annuitant table with projected mortality improvements), but do not include a factor for pre-retirement termination, mortality, or disability.(1) | | Consistent with the distribution requirements of Internal Revenue Code Section 409A and its regulations, vested Supplemental Pension Plan benefits, to the extent not previously funded, were distributed to the participants’ individual grantor trusts and included in the participants’ income. Amounts held in the officer’s individual trust are expected to offset Abbott’s obligations to the officer under the plan. During 2021, the amounts shown, less applicable tax withholdings, were deposited in such individual trusts established by the named officers. Grantor trusts are described in greater detail in the section of the proxy statement captioned, “Compensation Discussion and Analysis—Benefits and Perquisites.”(2) |

  176. 2021 PENSION BENEFITS

    | 64 | |

  177. 2021 PENSION BENEFITS

    | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL |

  178. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY Abbott does not have employment agreements with its named officers. The following summarizes the payments that the named officers, other than Mr. White, would have received if their employment had terminated on December 31, 2021. Earnings would have continued to be paid to the named officer’s Performance Incentive Plan, Management Incentive Plan, and Supplemental 401(k) Plan grantor trusts, until the trust assets were fully distributed. The amount of these payments would depend on the period over which the trusts’ assets were distributed and the trusts’ earnings. If the trusts’ assets were distributed over a ten-year period and based on current earnings, the named officers would receive the following average annual payments over such ten-year period:

  179. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    | ● | R. B. Ford, $483,418 | | ● | R. E. Funck, Jr., $423,203 | | ● | H. L. Allen, $386,119 | | ● | D. G. Salvadori, $79,870 | | ● | A. F. Wainer, $132,867 |

  180. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    In addition, the following one-time deposits would have been made under the Abbott Laboratories Supplemental Pension Plan for the following named officers:

  181. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    | ● | R. B. Ford, $1,335,692 | | ● | R. E. Funck, Jr., $477,491 | | ● | H. L. Allen, $207,073 | | ● | D. G. Salvadori, $59,592 | | ● | A. F. Wainer, $609,540 |

  182. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    If the termination of employment was due to disability, then the following named officers also would have received, in addition to Abbott’s standard disability benefits, a monthly long-term disability benefit in the amount of:

  183. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    | ● | R. B. Ford, $158,420 | | ● | R. E. Funck, Jr., $52,420 | | ● | H. L. Allen, $46,085 | | ● | D. G. Salvadori, $46,285 | | ● | A. F. Wainer, $46,580 |

  184. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    This long-term disability benefit would continue for up to 24 months following termination of employment. It ends if the officer retires, recovers, dies, or ceases to meet eligibility criteria. In addition, if the employment of these named officers had terminated due to death or disability, the officer’s unvested stock options and restricted shares would have vested on December 31, 2021 with values as set forth below in the section captioned, “Equity Awards.” As a retired Chairman and CEO, Mr. White will continue to have use of an office and administrative support. The estimated annual cost of this benefit is approximately $150,000 to $200,000.

  185. POTENTIAL PAYMENTS UPON TERMINATION—GENERALLY

    | | 65 |

  186. POTENTIAL PAYMENTS UPON CHANGE IN CONTROL

    POTENTIAL PAYMENTS UPON CHANGE IN CONTROL Abbott has change in control arrangements with other key members of its management team, in the form of change in control agreements for Abbott officers and a change in control plan for certain other management personnel. The agreements with Messrs. Ford, Funck, Jr., Allen, and Salvadori and Ms. Wainer are described below. Each change in control agreement continues in effect until December 31, 2022, and can be renewed for successive two year terms upon notice prior to the expiration date. If notice of non-renewal is given, the agreement will expire on the later of the scheduled expiration date and the one-year anniversary of the date of such notice. If no notice is given, the agreement will expire on the one-year anniversary of the scheduled expiration date. Each agreement also automatically extends for two years following any change in control (see below) that occurs while the agreement is in effect. The agreements provide that if the officer is terminated other than for cause or permanent disability or if the officer elects to terminate employment for good reason (see below) within two years following a change in control of Abbott, the officer is entitled to receive a lump sum payment equal to three times the officer’s annual salary and annual incentive (“bonus”) award (assuming for this purpose that all target performance goals have been achieved or, if higher, based on the average bonus for the last three years), plus any unpaid bonus owing for any completed performance period and the pro rata bonus for any current bonus period (based on the highest of the bonus assuming achievement of target performance, the average bonus for the past three years, or in the case of the unpaid bonus for any completed performance period, the actual bonus earned). If the officer is terminated other than for cause or permanent disability or if the officer elects to terminate employment for good reason during a potential change in control (see below), the officer is entitled to receive a lump sum payment of the annual salary and bonus payments described above, except that the amount of the bonus to which the officer is entitled will be based on the actual achievement of the applicable performance goals. If the potential change in control becomes a “change in control event” (within the meaning of Section 409A of the Internal Revenue Code), the officer will be entitled to receive the difference between the bonus amounts the officer received upon termination during the potential change in control and the bonus amounts that would have been received had such amounts instead been based on the higher of the officer’s target bonus or the average bonus paid to the officer in the preceding three years. Bonus payments include payments made under the Performance Incentive Plan. The officer will also receive up to three years of additional employee benefits (including welfare benefits, outplacement services and tax and financial counseling, and the value of three more years of pension accruals). If change in control related payments and benefits become subject to the excise tax imposed under Section 4999 of the Internal Revenue Code, payments under the agreement will be reduced to prevent application of the excise tax if such a reduction would leave the executive in a better after-tax position than if the payments were not reduced and the tax applied. The agreements also limit the conduct for which awards under Abbott’s incentive stock programs can be terminated and generally permit options to remain exercisable for the remainder of their term. For purposes of the agreements, the term “change in control” includes the following events: any person becoming the beneficial owner of Abbott securities representing a specified percentage of the outstanding voting power (not including an acquisition directly from Abbott and its affiliates); a change in the majority of the members of the Board of Directors whose appointment was approved by a vote of at least two thirds of the incumbent directors; and the consummation of certain mergers or similar corporate transactions involving Abbott. A “potential change in control” under the agreements includes, among other things, Abbott’s entry into an agreement that would result in a change in control. Finally, the term “good reason” includes: a significant adverse change in the executive’s position, duties, or authority; Abbott’s failure to pay the executive’s compensation or a reduction in the executive’s base pay or benefits; or the relocation of Abbott’s principal executive offices to a location that is more than thirty-five miles from the location of the offices at the time of the change in control.

  187. POTENTIAL PAYMENTS UPON CHANGE IN CONTROL

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  188. POTENTIAL PAYMENTS UPON CHANGE IN CONTROL

    If a change in control had occurred on December 31, 2021 immediately followed by one of the covered circumstances described above, Messrs. Ford, Funck, Jr., Allen, and Salvadori and Ms. Wainer would have been entitled to receive the following payments and benefits under the change in control agreements:

  189. POTENTIAL PAYMENTS UPON CHANGE IN CONTROL

    | Name | Cash Termination Payments | Additional Supplemental Pension Plan Benefits | Welfare and Fringe Benefits | | R. B. Ford | $15,543,400 | $1,894,488 | $94,364 | | R. E. Funck, Jr. | 6,368,900 | 2,156,830 | 62,853 | | H. L. Allen | 5,901,100 | 1,698,288 | 51,242 | | D. G. Salvadori | 6,021,200 | 189,288 | 87,613 | | A. F. Wainer | 5,511,100 | 3,888,988 | 74,152 |

  190. EQUITY AWARDS

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