Leidos, Inc. Retirement Plan Summary Plan ... - …

[Pages:55]Leidos, Inc. Retirement Plan Summary Plan Description

JANUARY 1, 2021

This summary applies to non-bargained and bargained employees eligible to participate in the Plan. A copy of this summary can be found on the Leidos Retirement Plan page on Prism. Bargained Employees: refer to your applicable Collective Bargaining Agreement with Leidos in conjunction with this summary for the terms applicable to you.

Prospectus Information

This document constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933, as amended. Please consult the Supplement to Prospectus and Summary Plan Description for information regarding Company Stock.

The prospectus for the Leidos, Inc. Retirement Plan (including the Company's filings with, and disclosures to, the Securities and Exchange Commission) specifically are not incorporated into and are not part of this Summary Plan Description.

The date of this document is January1, 2021.

When the term "Company" is used in this summary, it may also mean any affiliated companies, the parent company or any successor (and prior to September 2013, to Science Applications International Corporation).

Service with any participating company may determine eligibility to participate, vesting credit and allocation of contributions to the Leidos, Inc. Retirement Plan (herein referred to as "Plan").

Summary Disclaimer

This summary does not contain all the details of the Plan or determine your rights under the Plan, but is intended only to answer the most frequently asked questions about the Plan and to provide a description of the material terms of the Plan and how the Plan operates. The official Plan document sets forth your rights and obligations under the Plan. If there is a conflict between the Plan document and this summary, the terms of the Plan document will control. Nothing in this summary should be considered as altering or affecting the provisions of the Plan document itself. In determining specific benefits, the full Plan provisions, as they exist now or in the future, always govern. Also, the Plan may be amended without prior notice, and this summary may not be updated until a date later than the effective date of a Plan amendment. Copies of the Plan document are available for your review upon your request.

Leidos, Inc. Retirement Plan

Saving for retirement is one of the best ways to help ensure that you will be financially secure when you are no longer working. The Plan is one of the ways you have to build your retirement savings.

A Brief Overview

Here are some of the Plan's highlights:

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It's easy to save for retirement. You save money each pay period with deductions taken

directly from your paycheck.

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It's flexible. You can change or stop contributions or change your investment

options at any time. You have easy access to your Plan information online day or

night or through a toll-free telephone number where dedicated specialists can assist

you weekdays, 8:30 a.m. ? 9 p.m., ET.

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You can make Pre-Tax Contributions, which lower your current taxable income. You

don't pay income taxes on your savings or their earnings until they are distributed,

usually at retirement.

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You can make Roth 401(k) Contributions, which allow you to contribute after-tax

dollars to the Plan and withdraw these amounts during your retirement without paying

additional taxes. In addition, the earnings on these contributions are tax-free if you hold

the Roth 401(k) account for at least five years and are at least age 59? on the date of

distribution. Note: Puerto Rico Participants are not eligible to make Roth

contributions.

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You can make Traditional After-Tax Contributions, which allow you to contribute

after-tax dollars to the Plan and withdraw them at any time. Earnings on after-tax

contributions are not taxed until they are distributed. Traditional After-Tax

Contributions are not eligible for Company match.

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Bargained Employees may make an additional CODA Deferral, on a pre-tax basis if

your collective bargaining agreement with Leidos provides for a CODA Deferral.

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The Company contributes. Leidos adds to your savings by making Company

Matching Contributions each pay period based on your Pre-Tax and Roth 401(k)

Contributions as long as you make a contribution each pay period and you are in an

eligible fringe benefit package. Bargained Employees: refer to your applicable

collective bargaining agreement with Leidos for terms applicable to you.

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Catch-Up Contributions happen automatically. If you are or will be age 50 during the

plan year, your Pre-Tax and Roth 401(k) Contributions can continue beyond the IRS

limit to include the allowed Catch-Up Contribution. Just make sure to adjust your

deferral percentage to reach the total amount you wish, up to the limit.

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You are in control. You choose how contributions are invested from a variety of

diversified investment options.

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You have access to loans. While you are employed by Leidos, you may elect to

take a loan from the Plan. Even after your employment ends, if you maintain a

balance in your 401(k) account, you may still have access to loans.

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The benefit is yours. Your vested Plan benefits are payable upon your termination,

disability or death, and in some cases while you are still working. In most cases, you

can elect to receive your benefits as a lump-sum cash payment or installment

payments, or you may roll over your balance to the qualified plan of another employer,

or to a Rollover IRA. In some cases, the amounts you have invested in Company

Stock may be paid to you in kind as shares of Leidos, Inc. common stock.

The chart below provides a summary of the important features of the Plan:

Employee Contributions

You can save up to 90% of your eligible compensation into the Plan, subject to the IRS limits. You can make your contributions on a Pre-Tax basis, Roth basis, or After-Tax basis. Please note Puerto Rico Participants are not eligible to make Roth contributions and are subject to a 10% cap on After-tax contributions.

CODA Deferrals Company Contributions

Bargained Employees: If your collective bargaining agreement with Leidos provides for a special "CODA" amount equal to a percentage of your regular compensation, you can elect to defer up to 100% of this amount in the Plan, in addition to your other Contributions. For eligible fringe groups, the Company also provides a matching contribution based on your Pre-Tax and Roth 401(k) Contributions to supplement the amount you save for retirement.

Company Contributions are posted to your account each pay period in which you make Pre-Tax and/or Roth 401(k) Contributions and are applied to the same investment elections as your Employee Contributions.

Vesting

Bargained Employees: refer to your collective bargaining agreement with Leidos for terms applicable to you.

You are always 100% vested in your contributions into the Plan.

If you work on or after January 1, 2018, full Vesting occurs after three Years of Service: x the Company Matching Contributions vests 25%

after completing your first Year of Service, 50% after your second Year of Service, and you are 100% vested after completing your third Year of Service.

Vesting, continued Investments Loans Withdrawals

If you did not work on or after January 1, 2018, a different Vesting schedule applies to your Company Matching Contributions. Please refer to the Summary Plan Description in place at the time of your separation for details.

The Plan offers a diversified selection of investment options for you to elect how to invest your Plan account.

The Plan also allows you to invest in a Company Stock fund.

You can have up to two outstanding loans from the Plan ? either two general purpose loans, or one general purpose loan and one loan used for the purchase of your principal residence.

You can withdraw your Traditional After-Tax Contributions and Rollover amounts from the Plan at any time. You can withdraw amounts for a hardship. You can withdraw amounts for any reason if you are age 59? or older. You can withdraw limited amounts for expense related to the birth or adoption of a child.

When you leave the Company, you can leave your account with the Plan, or you can receive a distribution of your account as a lump sum, partial lump sum or installment payments.

If you take your money from the Plan before age 59?, you may be subject to an additional tax of 10% on pre-tax amounts (and a 10% penalty on the portion of the withdrawal that represents Roth earnings). You will also owe taxes on any earnings for pre-tax and traditional after-tax lump sum or partial lump sum withdrawals. If you separate from service at age 55 or older, or elect at any age to receive substantially equal installment payments to be made annually over your life expectancy, you may have exceptions to the 10% early withdrawal penalty.

Contents

Glossary

1

Eligibility and Participation

4

Who Is Eligible

4

Who Is Not Eligible

4

When You May Begin to Participate

4

How to Enroll

4

Contributions to the Plan

5

Your Contributions

5

Rollovers Contributions

11

In-Plan Roth Conversion

12

Company Contributions

13

How Contributions Are Invested

14

Leidos Stock Funds

15

Valuation of Leidos Stock Fund Accounts

16

Keeping Track of Your Account

16

How Vesting Works

17

Vesting of Your Contributions

17

Vesting of Company Contributions

17

How Service is Counted

18

What Is an Hour of Service?

18

What Is a Year of Service?

18

What is a Break in Service?

19

Taking a Loan from Your Account

20

How Much You May Borrow

20

Repaying Your Loan

20

Withdrawals

21

Withdrawals While You Are Actively Employed

21

Withdrawals When You Are No Longer Actively Employed

23

Beneficiary Information

26

Learning More About the Plan

29

Online Access

29

Telephone Access

29

Other Information You Should Know

29

Employment Transfers

29

Loss or Denial of Benefits

30

Claim Procedures

32

Fees and Expenses

33

Plan Administration

34

ERISA Rights

35

Plan Information

37

Additional Information

Supplement to Prospectus and Summary Plan Description

39

Your Investment Options at a Glance

47

Glossary

There are various terms used in this summary that have a specific meaning with respect to the Plan. This section explains those terms so that you can better understand your benefits. These terms are printed in boldface whenever they appear to let you know that they are defined here.

Bargained Employees Bargained Employees means an employee of the Company covered by a collective bargaining agreement between the Company and "employee representatives" under which retirement benefits were the subject of good faith bargaining.

Beneficiary The person or persons designated to receive your account in the event of your death. If you do not have a Beneficiary on file with Vanguard at the time of your death, your Plan assets will be distributed to your spouse if you are married, or to your estate if you are not married. Beneficiaries you elect may be either an "Eligible Designated Beneficiary" or "Non-Eligible Designated Beneficiary" as defined by the IRS and this may impact the manner and timing in which they may elect to distribute the account.

Break-in-Service Any 12-month Computation Period during which you have 425 or fewer Hours of Service.

Catch-Up Contribution Contributions you may make if you will be at least age 50 before the last day of the calendar year and have exceeded your regular 401(k) elective contribution limits. If you are eligible to make Catch-Up Contributions (maximum $6,500 or $1,500 for Puerto Rico Participants in 2021), and the sum of your Pre-Tax Contributions and Roth 401(k) Contributions for the year have reached the IRS contribution limit ($19,500 in 2021), any further contributions you make based on the percentage of pay you elect will automatically be considered Catch-Up Contributions. Catch-Up Contributions will be made based on your election of Pre-Tax Contributions and/or Roth 401(k) Contributions. Contribution limits and Catch-Up Contribution limits are established by the IRS and may be adjusted annually.

CODA or CODA Deferrals An elective contribution made by you and deducted from a cash or deferred arrangement, or CODA, cash payment to you from the Company under a collective bargaining agreement with Leidos.

Committee The Leidos, Inc. Retirement Plans Committee or any successor of that Committee.

Company Leidos, Inc. (or its parent corporation), or any successor of Leidos. Company also includes any affiliated company (or other entity) that has been granted permission by the Board of Directors to participate in the Plan.

Leidos, Inc. Retirement Plan Summary Plan Description | 1

Company Matching Contribution A Company contribution made to your account as a result of your having made 401(k) elective contributions on either a Pre-Tax and/or Roth 401(k) After-Tax basis. Traditional After-Tax Contributions are not eligible for Company Matching Contributions.

Company Stock Common stock of Leidos Holdings Inc. (the parent corporation of Leidos, Inc.) which is publicly traded on the New York Stock Exchange under the symbol "LDOS."

Computation Period A 12-month period of time used to determine your Years of Service for Vesting purposes and whether you have had a Break-in-Service. The Computation Period for Break-in-Service purposes is the 12 months following your hire date, and after that any calendar year starting after your hire date. For purposes of Vesting, the relevant Computation Period in all cases is the calendar year.

ERISA The Employee Retirement Income Security Act of 1974, as amended from time to time.

Hour of Service For an hourly employee, each hour of working or nonworking time (e.g., vacation, sick leave, jury duty) for which you are paid or entitled to be paid by the Company. Salaried employees are credited with 45 hours of service each week of service, regardless of actual number of hours worked.

Plan Administrator The administrator of the Plan, in this case, the Company.

Pre-Tax Contribution An elective contribution made by you and deducted from your paycheck before federal and state income taxes (unless required by your state) are withheld. You do not pay any income tax on these contributions and related earnings until distribution.

Puerto Rico Participants Puerto Rico participants under the Plan are employees who are employed by the Company in Puerto Rico and are a bona-fide resident of Puerto Rico or perform labor or services primarily within Puerto Rico, regardless of residence.

Rollover Contribution An employee's voluntary contribution of amounts from the qualified retirement plan of a previous employer or an eligible Rollover IRA.

Roth 401(k) Contribution An elective contribution made by you, designated as a Roth 401(k) Contribution, and deducted from your paycheck after federal and state income taxes are withheld. Provided certain criteria are met at the time you take a distribution of these contributions, you will not pay any income tax on these contributions and related earnings at distribution. Please note Puerto Rico Participants are not eligible to make Roth 401(k) Contributions.

Leidos, Inc. Retirement Plan Summary Plan Description | 2

Leidos Stock Funds The funds which invest primarily in Leidos, Inc. common stock and have a small cash position to facilitate transactions. There are two Leidos Stock Funds ? the Leidos Common Stock Fund and the Leidos Closed Stock Fund. Traditional After-Tax Contribution A contribution made by you and deducted from your paycheck after federal and state income taxes are withheld, that is not a Roth 401(k) Contribution. Traditional After-Tax Contributions are not eligible for Matching Contributions. Vesting Your right to ownership in your Plan account. You are vested immediately upon eligibility for your own contributions. Company contributions are subject to a Vesting schedule based on Years of Service. You are 100% vested in dividends from Company Stock that are reinvested in the Plan. Year of Service A Computation Period (calendar year) during which you complete 850 or more Hours of Service. You will never receive more than one Year of Service with respect to services performed in a single Computation Period.

Leidos, Inc. Retirement Plan Summary Plan Description | 3

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