Qualified Default Investment Alternative Notice

Transcription

1 Qualified Default Investment Alternative Notice November 10, 2017 This notice applies to the Lockheed Martin Corporation Salaried Savings Plan (the SSP or the Plan). The Plan has a number of investment options in which you can invest your retirement plan assets. As a participant in the SSP, you are responsible for directing your contributions among the Plan s investment options. The investment options in the Plan are explained in the Investment Options Guide (Guide). The Guide is a part of the Summary Plan Description (SPD) for the Plan. The SPD may also include Summaries of Material Modifications which updates the Guide. The Plan s investment options include the Target Date Funds (TDFs). Each TDF: has an investment strategy that is designed to be appropriate for a particular time horizon based on an anticipated retirement date; is diversified, investing in a mix of underlying separate stock, bond and other asset class portfolios; and is designed to provide an age-appropriate asset allocation in order to produce sufficient returns to meet retirement goals for the average participant. There are no guarantees that a TDF s investment objectives will be met. Lockheed Martin Corporation, as plan sponsor/plan fiduciary, has chosen the TDFs as the Qualified Default Investment Alternative (QDIA) for the SSP. A QDIA is a default investment alternative or option, as defined under rules issued by the U.S. Department of Labor, chosen by the Plan s fiduciary for those instances when participants have not chosen how to invest their retirement plan account. The specific TDF chosen as the QDIA is described below under Automatic Investment of Contributions. The TDFs are the default investment option for employee contributions, Company contributions other than Company Matching contributions, and for situations where contributions might be made in the absence of participant direction, such as the investment of proceeds from settlements. TDF returns are reduced by the expenses of the underlying investment portfolios. These expenses include investment management fees and administrative expenses. The aggregate annual investment management fees for each TDF can range from approximately.15% to.82% of TDF assets, and over time the aggregate annual administrative expenses for each TDF can range from approximately.03% to.09% of TDF assets, but are expected to average approximately.05%. Hence, total annual expenses can range from approximately.18% to.91% of TDF assets over time. Note: Company Matching contributions are automatically invested in the Employee Stock Ownership Plan (ESOP) Fund. 109aNotP17

2 Automatic Investment of Contributions If you do not direct the investment of your account into any of the Plan s investment options, your contributions and any Company Contributions for which you may be eligible, except the Company Match, will be invested automatically in the TDF based on your birth date, per the following table. Target Date Funds Birth Date Ranges Fund Name Birth Date Range Target Date Fund 2060 January 1, 1993 or after Target Date Fund 2055 January 1, December 31, 1992 Target Date Fund 2050 January 1, 1983 December 31, 1987 Target Date Fund 2045 January 1, 1978 December 31, 1982 Target Date Fund 2040 January 1, 1973 December 31, 1977 Target Date Fund 2035 January 1, 1968 December 31, 1972 Target Date Fund 2030 January 1, 1963 December 31, 1967 Target Date Fund 2025 January 1, 1958 December 31, 1962 Target Date Fund 2020 January 1, 1953 December 31, 1957 Target Date Fund 2015 January 1, 1948 December 31, 1952 Target Date Fund 2010 January 1, 1943 December 31, 1947 Target Date Fund 2005 December 31, 1942 or before Default Investment Exceptions Prior to 1/1/2007, the default investment was the Stable Value Fund For participants born after December 31, 1987, the default investment option during the period 1/1/2007 to 1/3/2010 was TDF 2050 For participants born after December 31, 1992, the default investment option during the period 1/4/2010 to 1/1/2015 was TDF 2055 If one of these exceptions applies to you, your account balance and future contributions will continue to be invested in the default investment option until you change your investment election. Right to Direct Investment out of the QDIA If your account is invested in the QDIA as a result of your choice not to provide investment directions, you have the right to discontinue your investment in the QDIA and to invest your account balance in the other investment options available under your plan. You have a 120-day period to make changes on the date of your initial default investment into the QDIA. During this period you are entitled to transfer the amount invested in the QDIA to the other investment options without incurring any additional fees or expenses (other than ongoing fees and expenses related to the operation of the TDFs) and without being subject to any restrictions (such as reinvesting in a TDF for 30 days after transferring out of that investment option). However, the Plan maximum of 12 trades per calendar year (with at least one trade per calendar quarter and one final trade opportunity to the Stable Value Fund at the end of the calendar year) will continue to apply. 2

3 Note about your Default Investment when Birth Date is missing from Account Record A participant whose account in the Plan is established through the transfer of his/her account balance from a plan of an acquired company and whose birth date is missing from their account record, has the opportunity in advance of their account transfer to supply their birth date and select any of the Plan s investment options. If such participants do not provide a birth date or make investment elections, the default investment fund will be Target Date Fund Additional Information or Assistance If you want to change your investment elections, have any questions about this document, or want to obtain a copy of the SPD, including the Investment Options Guide: Access the Savings Plan Web Tool via LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan. Or, go directly to Call the Savings Plan Information Line: - Toll-free within the U.S.: From outside the U.S.: For TDD communication services for the hearing impaired: Customer service representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays. 3

4 November 10, 2017 Notice of Automatic Enrollment and Automatic Escalation in the Salaried Savings Plan This notice: provides important information about the automatic enrollment feature in the Lockheed Martin Corporation Salaried Savings Plan (the SSP or the Plan); explains how contributions resulting from automatic enrollment are invested and how to change your contributions to the Plan; specifies the conditions under which you may request a refund of contributions made to the Plan resulting from automatic enrollment; and serves as a reminder for those employees who have been automatically enrolled in the Plan and whose contributions to the Plan may be automatically increased annually. Additional information about the Plan is included in the Plan s Summary Plan Description (SPD). Automatic enrollment Automatic enrollment applies to all new employees, rehired employees, or employees who first become eligible to participate in the Plan as a result of either a transfer or their business unit becoming a participating unit in the Plan. Effective 30 days after your date of hire, rehire, or transfer into one of the business units that participate in the Plan, 3% of your eligible compensation will be automatically withheld from your pay each week on a before-tax basis and contributed to the Plan, unless you choose to opt out or enroll in the Plan at a different contribution percent. Automatic escalation If you are automatically enrolled in the SSP and you do not change your contribution percent or opt out of contributing to the Plan, your contribution percent will be increased by 1% annually until your contribution percent reaches 8%. The first year that your contribution percent will be automatically increased is the year after your initial automatic enrollment. The annual escalation date is established by Lockheed Martin Corporation (the Company) and typically occurs in February or March. If you are subject to automatic escalation you will be notified at the beginning of the year and will be provided instructions on how to opt out. Changing your contribution percent at any time after the automatic escalation has begun will cancel your selection for automatic escalation. Your automatic contributions to the Plan are withheld from your pay and are not subject to federal income taxes at that time. Your contributions are deposited into your Plan account on a before-tax basis and can grow over time with earnings. Your account will be subject to federal income taxes when funds are withdrawn. 109hNotP17

5 Note: Your total contribution will be eligible for the Company match in accordance with the SSP s matching provisions and formula. The Company will match 50 cents for each dollar you contribute, up to 8% of pay (a maximum of 4% of pay). You control the amount you contribute. You may decide to do nothing, in which case you will be automatically enrolled with automatic annual increases, or you may choose to contribute an amount that better meets your specific needs. For example, you may want to get the full amount of the Company s matching contribution by contributing at least 8% of your eligible pay. Under the terms of the Plan, you can contribute up to 40% of your eligible pay (Internal Revenue Code rules may limit the amount of your contributions that can be made on a before-tax basis). You can opt out of automatic enrollment or change your contribution percent by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line. If you do not want to contribute to the Plan, you have 30 days from your date of eligibility to opt out before your contributions will automatically begin. Once you opt out of automatic escalation, you will not be subject to automatic escalation again. Except as set forth in the Refund of Your Automatic Enrollment Contributions section below, contributions to the Plan, generally must remain in the Plan until you terminate employment or qualify for an in-service withdrawal or loan. The limits on your ability to withdraw your money may be important to you in deciding how much, if any, to contribute to the Plan. See the Plan s SPD for more details. Other Contribution Options You may choose to contribute (before-tax, Roth 401(k) and/or after-tax) immediately upon becoming eligible rather than waiting to be automatically enrolled. Additional information on the various types of contributions, limits, and other important details are included in the Plan enrollment kit and in the SPD. Refund of Your Automatic Enrollment Contributions You may request a refund of contributions to the Plan as a result of automatic enrollment within 90 days of the first payroll period when the automatic enrollment took effect. Your refund request will apply to all automatic enrollment contributions made since the automatic enrollment started. If you wish to request a refund of contributions that have been made to the Plan as a result of automatic enrollment, you may do so by logging on to the Savings Plan Web Tool or calling the Savings Plan Information Line. The automatic enrollment contributions refunded to you will be adjusted for any gains or losses, and will be treated as taxable income for the plan year. The payment will not be eligible for rollover and will not be subject to the additional 10% early withdrawal penalty incurred for premature distributions from a retirement plan. If you elect to receive a refund of contributions due to automatic enrollment, your future employee contributions to the plan will be stopped. You will also forfeit all Company matching contributions made to your refunded automatic enrollment contributions. You may restart employee contributions to the Plan at a later date by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line. If you choose to restart your contributions, the automatic enrollment contributions that were refunded will count in the determination of how much you may contribute during that same year, subject to applicable Internal Revenue Code annual limitations. 2

6 How Will My Plan Account Be Invested? The Plan offers a wide range of investment options. You can choose the how to invest your contributions among the Plan s investment options. You can also change the way your contributions are invested from time to time. Target Date Funds (TDFs) are the default investment options for the Plan. If you have not designated an investment election, your contributions are automatically invested in one of the Plan s TDFs based on your birth date, per the following table. (This also applies to Company Contributions for which you may be eligible, but does not apply to Company Matching contributions to the Plan, which are automatically invested in the Employee Stock Ownership Plan (ESOP) Fund). Target Date Funds Birth Date Ranges Fund Name Birth Date Range Target Date Fund 2060 January 1, 1993 or after Target Date Fund 2055 January 1, 1988 December 31, 1992 Target Date Fund 2050 January 1, 1983 December 31, 1987 Target Date Fund 2045 January 1, 1978 December 31, 1982 Target Date Fund 2040 January 1, 1973 December 31, 1977 Target Date Fund 2035 January 1, 1968 December 31, 1972 Target Date Fund 2030 January 1, 1963 December 31, 1967 Target Date Fund 2025 January 1, 1958 December 31, 1962 Target Date Fund 2020 January 1, 1953 December 31, 1957 Target Date Fund 2015 January 1, 1948 December 31, 1952 Target Date Fund 2010 January 1, 1943 December 31, 1947 Target Date Fund 2005 December 31, 1942 or before Default Investment Exceptions Prior to 1/1/2007, the default investment was the Stable Value Fund For participants born after December 31, 1987, the default investment option during the period 1/1/2007 to 1/3/2010 was TDF 2050 For participants born after December 31, 1992, the default investment option during the period 1/4/2010 to 1/1/2015 was TDF 2055 If one of these exceptions applies to you, your account balance and future contributions will continue to be invested in the default investment option until you change your investment elections. You can change your investment elections for your existing balance or future contributions by accessing the Savings Plan Web Tool or the Savings Plan Information Line. Under the terms of the Plan, you may transfer assets to other investment options up to 12 times per year. However, if you transfer out of any investment option in the plan, you cannot transfer back into that particular investment option for 30 calendar days, unless you are were automatically enrolled and your account is invested in the default TDF because you did not provide investment directions. In this case, for a 120-day period beginning on the date of your initial default investment, if you transfer all or a portion of the amount automatically invested in your default TDF to the other investment options, you can transfer back into your default TDF. 3

7 The Investment Options Guide (Guide) gives more detailed information on the investment options in the Plan. The Guide is a part of the SPD for the Plan. The SPD may also include Summaries of Material Modifications which update the Guide. You may obtain performance data by accessing the Morningstar Investment Profiles on the Savings Plan Web Tool. These Investment Profiles contain specific investment information for each of the savings plans investment options and are updated quarterly. You may also obtain summary plan and investment-related information, including information on expenses for the investment options, on the Participant Disclosure Notice, a legal document prepared annually for participants in the SSP. The Participant Disclosure Notice is available by accessing the Savings Plan Web Tool or calling the Savings Plan Information Line. Target Date Funds (TDFs) Objective The TDFs provide professional investment management and offer participants a simple, one-step approach to fund selection. Because the underlying asset mix of a portfolio is one of the key drivers for successful investment management, each TDF is designed to provide an age-appropriate asset allocation in order to produce sufficient returns to meet retirement goals for the average participant. There are no guarantees that the TDFs investment objectives will be met. Composition and Strategy The TDFs invest in a number of underlying investment portfolios created specifically for the TDFs. Each of these portfolios may be further sub-divided to allow several different managers within a portfolio. Every three months the asset mix of each TDF is rebalanced to adjust gradually to a more conservative asset mix. This process is referred to as a Glide Path, and is used to avoid making significant asset mix changes at one time. The TDFs may also generate some income by loaning securities to creditworthy financial institutions. Factors Affecting Performance The TDFs investments in common stock are subject to considerable investment and stock market risk, including the possibility that stock prices will decline over short or even extended periods. Foreign stocks can be volatile due to changing trade patterns and economic policies, political and social instability and currency exchange rate fluctuations. Small to mid-sized company stocks carry additional risk due to more volatile cash flow and earnings. The TDFs fixed income/bond investments are sensitive to interest rate changes. When rates rise, bond values tend to decline and when rates fall, bond values tend to rise. The TDFs diversifier investments are intended to provide diversification and uncorrelated returns to stocks and bonds. These diversifier investments, which may include, but are not limited to, global real estate, commodities, and balanced risk investments, carry additional risk, some of it tied to cyclical price trends, inflation or deflation, and global supply and demand forces. Expenses TDF returns are reduced by the expenses of the underlying investment portfolios. The expenses include investment management fees and administrative expenses. The aggregate annual investment management fees for each TDF can range from approximately.15% to.82% of TDF assets, and over time the aggregate annual administrative expenses for each TDF can range from approximately.03% to.08% of TDF assets, but are expected to average approximately.05%. Hence, total annual expenses can range from approximately.18% to.90% of TDF assets over time. 4

8 Investment Managers Lockheed Martin Investment Management Company (LMIMCo) appoints the portfolio managers and the Glide Path provider and manager. The Glide Path provider and manager for the TDFs is AllianceBernstein. LMIMCo may replace one or more of these managers at any time without notice to participants. For a current list of managers, access the Investments section of the Savings Plan Web Tool, or call the Savings Plan Information Line. Investment Structure The TDFs were created for the Lockheed Martin savings plans using a mix of separate accounts, commingled trust funds and mutual funds. Historical Performance To obtain historical performance information for the TDFs or any other investment option in the Plan, you may access the Savings Plan Web Tool or call the Savings Plan Information Line. Fair Value Pricing The investment managers of the portfolios underlying the TDFs, in determining the net asset value (NAV) of their respective portfolios, may use fair value pricing. A manager may use fair value pricing when reliable market quotations are not readily available or if the value of a security has been materially affected by events occurring before the pricing time but after the close of the primary markets or exchanges on which the security is traded, as may happen with foreign securities. When fair value pricing is employed, the prices of securities used by a manager to calculate its portfolio s NAV may differ from quoted or published prices for the same securities. Additional Information or Assistance If you have any questions about this document or want to obtain a copy of the SPD, including the Investment Options Guide, or the Participant Disclosure Notice: Access the Savings Plan Web Tool via LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan > Plan Information. Or, go directly to Call the Savings Plan Information Line: - Toll-free within the U.S.: From outside the U.S.: For TDD communication services for the hearing impaired: Customer service representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays. 5

9 July 31, 2017 Participant Disclosure Notice Important Plan and Investment-Related Information for Lockheed Martin Corporation Savings Plan Participants This document provides participants in the Lockheed Martin Corporation Savings Plans important disclosures related to investment options in the plans, including fee and expense information. It is provided to increase awareness of your rights and responsibilities with respect to the investment of your assets in the savings plans. Two general categories of information are provided in this notice: 1) plan-related information for each savings plan in which you are a participant; and 2) investment-related information which applies to all savings plans as well as some summarized information about the plans. Additional information, including descriptions of certain terms used in the notice, is available in each plan s Summary Plan Description (SPD) and the Investment Options Guide. A glossary of investment terms is also available. If you have questions regarding the information in this notice, or wish to obtain additional information about the plan(s) in which you participate and/or the investment options, you may do any of the following: Access the Savings Plan Web Tool: LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan Or, go directly to Call the Savings Plan Information Line: U.S. Toll-free: Outside the U.S.: TDD communication services for the hearing impaired: Representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern Time, except on New York Stock Exchange holidays. Contact the Plan Administrator in writing at: Lockheed Martin Corporation Attn: Savings Plan Operations 6801 Rockledge Drive, CCT-115 Bethesda, MD A free paper copy of the information available on the Savings Plan Web Tool can be obtained by calling the Savings Plan Information Line. 118cNOTs17

10 Plan-Related Information for Participants in the Lockheed Martin Corporation Salaried Savings Plan ( SSP or the Plan ) Please review the following plan-related Information: 1. An explanation of the circumstances under which participants and beneficiaries may give investment instructions. The Plan allows participants to choose how to invest all employee contributions to their account other than Company Matching Contributions. Company Matching Contributions are automatically invested in the Lockheed Martin Corporation ESOP Fund. You may make unlimited transfers from the ESOP Fund into any investment option. However, reallocations that affect the ESOP Fund count toward the annual transfer limit. Please refer to section 2 below. You may change your investment elections for Before-Tax Contributions, Roth Contributions, and After-Tax Contributions, or any combination of these types, at any time, in one of two ways: Combined Decision - You can make a single set of investment elections for all contributions (other than Company Matching Contributions). Separate Choices You can also make different investment decisions separately for each type of contribution (other than Company Matching Contributions). Once you are enrolled in the Plan, you may direct your investments by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line. 2. An explanation of any specified limitations on your investment instructions under the terms of the Plan, including any restrictions on transfers to or from a designated investment alternative. You may change the investment mix of your current savings plan account balance by either a fund transfer or a reallocation up to 12 times during a calendar year.. In addition, you will have at least one transfer opportunity each calendar quarter no matter how many investment transfers you ve already made during the year. For example, even if you made 12 transfers by September 30, you would still be able to make one more transfer in the fourth quarter. You will also have one opportunity to transfer all or part of your account balance to the Stable Value Fund during the fourth quarter of the year - even if you ve made 13 transfers as described above. Fund transfers to or from a designated investment alternative can be made in 5% increments or whole dollar increments. Reallocations of your total account balance, or some portion thereof, must be made in 5% increments, and can be reallocated to all investment options except the Self-Directed Brokerage Account ( SDBA ). After transferring out of a fund, you may not transfer back into the fund for 30 days, with one exception: o If your first contribution is posted to the default Target Date Fund assigned at enrollment, the 30-day restriction will be waived for that fund for the first 120 days after the first contribution is posted. 118eNOTs17 SSP

11 Competing Fund Restrictions: o You cannot transfer directly from the Stable Value Fund into the SDBA, the Treasury Inflation-Protected Securities Fund ( TIPS Fund ) or the Government Short Term Investment Fund ( GSTIF ). o Amounts transferred out of the Stable Value Fund must remain invested in one of the Plan s Core Funds or a Target Date Fund for at least 90 days before being transferred into the SDBA, the TIPS Fund, or the GSTIF. You may make unlimited transfers from the Company Common Stock Fund and/or ESOP Fund into any investment option. Transfers from these funds will not count toward the 12 transfer opportunities allowed each year. However, a fund reallocation involving the Company Common Stock Fund and/or ESOP Fund will count toward your 12 annual transfer opportunities. 3. A description of or reference to plan provisions relating to the exercise of voting, tender and similar rights associated with an investment in a designated investment alternative as well as any restrictions on such rights. If you have a balance in the Company Common Stock Fund or ESOP Fund, you are entitled to voting rights on the company common stock held in these funds. You will be provided an annual report, proxy information and other materials that are provided to all shareholders of Lockheed Martin (the Company ). You also will receive information on how you may exercise your voting rights of your Company common stock. Voting instructions must be made directly to State Street Bank and Trust Company, the Plan Trustee. How you vote your shares will not be disclosed to Company management. If the Trustee does not receive timely voting instructions from you, the Trustee will vote your shares in proportion to those shares in the fund for which timely instructions are received from Plan participants. However, if the Trustee determines that voting in this fashion is not in the best interest of Plan participants, the Trustee will make an independent determination as to how to vote such shares. You may contact State Street Bank and Trust Company (by mail at P.O. Box 55772, Boston, MA , or by telephone at ) for details of the voting process. Tender or Exchange Offer If you have a balance in the Company Common Stock Fund or ESOP Fund, you may be offered the opportunity to tender your unit shares in these funds or to exchange such shares for shares in another company. If such a tender or exchange offer occurs, you will receive offer materials from the Trustee or other designated information agent. The materials will describe the offer and will outline the process and the deadlines that you must follow should you wish to tender or to exchange your unit shares in the Company common Stock Fund or ESOP Fund. If you do not tender or exchange your unit shares within applicable deadlines, none of your unit shares will be tendered or exchanged. Your decision on whether to participate in the offer will be kept confidential by the Trustee and will not be disclosed to Company management. New shares received in exchange for unit shares in the Company Common Stock Fund or ESOP Fund will be held in a new unitized stock fund within the Plan. Cash received in exchange for unit shares in the Company Common Stock Fund or ESOP Fund will be reinvested in accordance with the terms of the Plan. The appropriate investment fiduciary may place conditions on the new stock fund, including, but not limited to, mandatory liquidation requirements and restrictions on fund reallocations. If you hold shares of Company common stock through the Plans SDBA, you will receive information on any tender or exchange offer by accessing ameritraderetirement.com > My Account > History & Statements > Shareholder Library > Corporate Actions. You may request information on any offer by calling the Savings Plan Information Line. 2

12 4. An identification of any designated investment alternatives offered under the Plan. Core Funds Government Short Term Investment Fund (GSTIF) Stable Value Fund Treasury Inflation-Protected Securities (TIPS) Fund Broad Market Bond Index Fund High Yield Bond Fund S&P 500 Indexed Equity Fund U.S. Equity Fund Small/Mid-Cap Indexed Equity Fund Global Equity Fund MSCI EAFE Indexed Equity Fund Global Real Estate Fund Emerging Markets Indexed Equity Fund International Developed Markets Equity Fund Commodities Fund Company Common Stock Fund (Lockheed Martin Corporation Common Stock) ESOP Fund (Lockheed Martin Corporation Common Stock) Leidos Common Stock Fund (Leidos Common Stock) Target Date Funds Target Date Fund 2005 Target Date Fund 2010 Target Date Fund 2015 Target Date Fund 2020 Target Date Fund 2025 Target Date Fund 2030 Target Date Fund 2035 Target Date Fund 2040 Target Date Fund 2045 Target Date Fund 2050 Target Date Fund 2055 Target Date Fund An identification of any designated investment managers. Lockheed Martin Investment Management Company (LMIMCo), a wholly-owned subsidiary of Lockheed Martin Corporation, provides investment direction to the Plan s Trustee with respect to Plan assets. Voya Retirement Advisors, L.L.C. (VRA), a registered investment advisor, with sub-advisory services provided by Financial Engines Advisors L.L.C., provides investment management advice for those participants who choose to utilize the VRA Professional Management Advisory Service. 6. A description of any brokerage windows or self-directed brokerage accounts that enable participants to select investments beyond those designated investment alternatives. General Description In addition to the Plan s designated investment alternatives, you have the option to invest in the Plan s SDBA. The SDBA is a brokerage option offered in the Plan that affords more flexibility in choosing retirement savings investments by allowing you to invest in exchange-traded stocks, bonds and mutual funds. Brokerage services for the Plan s SDBA are provided by TD Ameritrade, Inc. (TD Ameritrade). 3

13 A separate Roth SDBA can be used to invest any amounts associated with Roth contributions, Roth rollovers or in-plan Roth conversions. Eligibility and Limitations All participants are eligible to open a non-roth and/or Roth SDBA. To do so you must have a combined balance of at least $4,000 in your Core Funds and Target Date Funds and make an initial transfer of at least $3,000 to the SDBA. Subsequent transfers to the SDBA must be at least $1,000. You may only transfer non-roth amounts to your non-roth SDBA and Roth amounts to your Roth SDBA. If the combined balance in your non-roth and Roth SDBAs exceeds 75% of your total Plan account balance, you may not transfer any additional amounts to either SDBA. Opening Your Account To open an SDBA, call the Savings Plan Information Line or access the Savings Plan Web Tool and request an SDBA application. Return the completed application by fax or mail to TD Ameritrade at the address provided on the application. Once the application is received and approved, TD Ameritrade will open your account(s) and send you information that includes a welcome letter, your SDBA number(s) and a description of TD Ameritrade resources that you can use to place trades and obtain information about your account(s). Additionally, you will receive a Personal Identification Number ( PIN ) for each account under separate cover. After using your account number and PIN to activate your account, you will be asked to create a User ID and password which you will use to access your account in the future. You ll then be able to transfer money into your SDBA(s). Transfer Restrictions To invest in your SDBA(s), you must transfer money from your Core Funds or Target Date Funds into your SDBA. Transfers may be initiated by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line. You are not permitted to transfer directly from the Stable Value Fund into an SDBA. Amounts transferred out of the Stable Value Fund must remain invested in the Core Funds or Target Date Funds for at least 90 days before they can be transferred into the TIPS Fund, the GSTIF or an SDBA. Roth 401(k) contributions, Roth rollovers and in-plan Roth conversions in your Plan account may only be transferred to a Roth SDBA. Only Savings Plan assets can be transferred into your SDBA(s). Accessing Your SDBA and Placing Trade Orders After you have opened and transferred money to your SDBA(s), you can access your account and place trade orders by: logging on to the TD Ameritrade trading website. Shortly after establishing your SDBA(s), you will receive a separate communication containing the website address and details about the site as well as an account number and PIN to be used exclusively for online trading in your SDBA(s). calling the TD Ameritrade Interactive Voice Response (IVR) phone system at , 24 hours a day, 7 days a week. The system will lead you through the quote and order process and prompt you to enter information using your telephone keypad and voice commands. Your account number and PIN allows you to complete automated trades. If you cannot provide your PIN, a representative will ask designated security questions to confirm your identity. calling TD Ameritrade licensed brokers at between the hours of 8:00 a.m. and 7:00 p.m., Monday through Friday, Eastern time, excluding New York Stock Exchange holidays. An experienced licensed broker will assist you with trades, quotes and market data. SDBA Fee and Expense Information Investments in the SDBA(s) are subject to administrative expenses, which may range from approximately.03% to.08% of fund assets, but are expected to average approximately.05%. These expenses are determined daily based upon the market value of your SDBA and are charged 4

14 proportionally each month to your Core Fund and Target Date Fund balances as a reduction in applicable units owned. In addition, your participation in the SDBA will be subject to the commissions, transaction and service fees as indicated in the following schedule: Commissions and Transaction Fees Stocks and ETFs 1 Price Internet orders $8.95 Interactive Voice Response (IVR) phone system orders $14.99 Broker-assisted orders $24.99 Commission-Free ETFs 2 No Commission 1 Orders executed in multiple lots on the same trading day will be charged a single commission. When an order is partially executed over multiple trading days, the order is subject to a separate commission charge for each trading day. 2 ETFs eligible for commission-free trading must be held at least 30 days. If you sell an eligible ETF within 30 days of it being purchased commission-free, a short-term trading fee will apply. Mutual Funds Price No Load $25.00 Load No Fee 3 No-Transaction-Fee (NTF) No Fee 4 3 The Fund Family will charge fees as detailed in the fund prospectus. 4 No-Transaction-Fee (NTF) mutual funds are no-load mutual funds for which TD Ameritrade does not charge a transaction fee. NTFs, as well as other funds, have other continuing fees and expenses described in the fund s prospectus. TD Ameritrade receives remuneration from fund companies for record-keeping, shareholder and other administrative services. The amount of remuneration is based in part on the amount of investments in such funds by TD Ameritrade clients. Almost all funds held 90 days or less will be subject to a short-term redemption fee of $ This fee is in addition to any applicable transaction fees or fees described in the fund's prospectus Fixed Income Investments 5 All buy orders for bonds are subject to a five bond ($5,000 par value) minimum. Online CD buy orders are subject to a two CD ($2,000 par value) minimum. Service Fees 6 5 TD Ameritrade may act as principal on any fixed income transaction. When acting as principal, TD Ameritrade will add a markup to any purchase and subtract a markdown from every sale. This markup or markdown will be included in the price quoted to you. Reorganization Fees Deposit 7 $25 Mandatory 8 $20 Non-mandatory and tender offers 9 $30 Withdrawal from tender offer 10 $10 Duplicate Statements and Confirmations $5 per paper copy (no charge for electronic documents) Research Fee 11 $60 per hour 6 All service fees are subject to change. TD Ameritrade reserves the right to pass through Regulatory Fees, foreign transaction taxes, and other fees to client accounts, which may be assessed under various 5

15 U.S. regulations or imposed by foreign governments. Fees may include any of the following: a sales fee on certain sell transactions (assessed at a rate consistent with Section 31 of the Securities and Exchange Act of 1934) and foreign transaction taxes and fees, among other charges. 7 Applies when a security has gone through a mandatory reorganization before the certificate is deposited into an account. 8 Applies when a security has gone through a mandatory reorganization for all shares held in an account, including those pending trade settlement, on the effective date of the reorganization Applies when a participant chooses to participate in a non-mandatory reorganization offer. Applies when a participant chooses to withdraw from a non-mandatory reorganization offer. Research is conducted subsequent to specific and usually disputed account activities. A portion of the revenue generated from the SDBA option may, through revenue sharing payments, be used to reduce administrative expenses proportionally among all Savings Plans. Additional Information on the SDBA The Self-Directed Brokerage Account Fact Sheet provides additional information on this brokerage option. You may obtain the Fact Sheet by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line. 7. An explanation of any fees for general plan administrative services (e.g., legal, accounting, recordkeeping) which may be charged against individual accounts. Certain fees may be deducted from your savings plan account balance. Such fees are for services required to administer the Plan (e.g., audit, communications, and legal services) and will be allocated among individual accounts in proportion to each account balance. You may review general plan administrative fees deducted from your account on your Plan statement. See Participant Fee Disclosure on Statements below for details. 8. An explanation of any fees and expenses that may be charged against the individual account of a participant/beneficiary on an individual rather than on a plan-wide basis. If you elect certain transactions, (e.g. a plan loan, overnight mail, or in-plan Roth conversion), or service program elections (e.g., Voya Retirement Advisors ( VRA ) Service/Professional Management), applicable fees will be deducted from your account. If you choose to invest in the Plan s SDBA (Roth and/or non-roth), administrative expenses, as described in section 6 above, will be deducted from your SDBA account(s). Individual fees deducted from your account are reflected on your savings plan account statement, as described below under Participant Fee Disclosure on Statements. Participant Fee Disclosure on Statements General plan administrative fees and individual fees deducted from your savings plan account may be viewed on your account statement. The section of the statement titled Your Fee Detail displays the dollar amount for certain administrative services and individual expenses actually charged to your savings plan account. The fees that may be displayed in the Your Fee Detail section of your statement include: Administrative Fees fees that are plan specific, such as printing and postage costs for savings plan communications Loan Request Fee loan application fee Overnight Mail Fee for documents you have requested be sent overnight Self-Directed Brokerage Fee for participants who have selected the Roth and/or non-roth Self-Directed Brokerage Accounts as investment options Managed Account Fee for participants who have elected Professional Management i.e., the managed account option of the VRA Advisor Service 6

16 In-Plan Roth Conversion Fee for participants who have elected to make an in-plan Roth conversion from certain non-roth account balances to a new Roth conversion source in their account Most expenses, including fees for recordkeeping, trustee services, investment oversight, and other administrative costs are not deducted from your savings plan account but are charged via the total annual operating expenses of the plan s investment options, as described in the investment-related information included in this notice. These fees are not included in the Administrative Fees displayed on your statement, rather they are reflected as a reduction to overall fund returns. You may review your account balance and generate a statement at any time throughout the year by accessing the Savings Plan Web Tool. 7

17 Investment-Related Information for Participants in the Lockheed Martin Corporation Savings Plans The investment-related information provided within this document applies to the following Lockheed Martin Corporation (LMC) Savings Plans: LMC Salaried Savings Plan (SSP) LMC Hourly Employee Savings Plan Plus (HSP) LMC Basic Benefit Plan for Hourly Employees (BBP) LMC Operations Support Savings Plan (OSSP) LMC Performance Sharing Plan for Bargaining Employees (PSP) LMC Capital Accumulation Plan (CAP) LMC Capital Accumulation Plan for Hourly Employees (HCAP) This document has two parts. Part I consists of performance information for the savings plans investment options. Part II shows the fees and expenses incurred in 2016 for each investment option. Part I. Performance Information Table 1 shows the performance of investment options that do not have a fixed or stated rate of return, which allows you to compare how the plans investment options and their benchmarks have performed over time. Past performance does not guarantee future performance. Your investment(s) in these options may lose money. Information about an investment option s risks is available on the Savings Plan Web Tool. Table 1 shows performance information as of 12/31/2016. Current performance may be higher or lower than the performance shown. To obtain the most recent month-end performance, visit the Savings Plan Web Tool. Additional information about the Plan s investment options, including a glossary of investment terms, is available on the Savings Plan Web Tool. Table 1 - Variable Return Investments Summary of Investment Performance 1 as of 12/31/2016 Average Annual Rate of Return 2 Name / Type of Option Benchmark/Index 3 1 year 5 years 10 years Since Inception Equity Funds S&P 500 Indexed Equity Fund / Large Blend 11.94% 14.62% 6.93% 9.15% S&P 500 Index 11.96% 14.66% 6.95% 9.19% U.S. Equity Fund / Large Blend 9.71% N/A N/A 7.59% Russell 3000 Index 12.74% N/A N/A 9.11% Small / Mid Cap Indexed Equity Fund / Small Mid-Cap Blend 16.52% 14.55% 7.79% 8.99% Russell Small Cap Completeness Index 16.59% 14.61% 7.80% 8.86% Global Equity Fund / Large Blend 3.64% N/A N/A 4.57% MSCI ACWI IMI Net 8.36% N/A N/A 3.74% Int l Developed Markets Equity Fund / Large Blend 3.21% N/A N/A -0.34% 118dNOTs17

18 MSCI World ex USA IMI Net 2.95% N/A N/A -0.45% MSCI EAFE Indexed Equity Fund / Foreign Large Blend 1.86% 6.75% 0.91% 5.01% MSCI EAFE Index 1.00% 6.53% 0.75% 4.88% Global Real Estate Fund / Global Real Estate 2.23% 8.86% N/A 6.88% FTSE EPRA/NAREIT Dev Net TRI USD 4.06% 9.48% N/A 7.85% Emerging Markets Indexed Equity Fund / Foreign Large Blend 10.91% 1.08% N/A -0.17% MSCI Emerging Markets Index 11.19% 1.28% N/A 0.12% Commodities Fund / Commodities Broad Basket 11.35% -9.53% N/A -6.40% DJ-UBS Commodity Index TR 11.77% -8.95% N/A -6.17% Company Common Stock Fund 4 / Non-Diversified Domestic Equity 18.20% 29.62% 13.93% 13.01% Lockheed Martin Corporation Common Stock 18.37% 29.86% 14.10% 13.54% ESOP Fund Salaried (SSP only) 4 / Non-Diversified Domestic Equity 18.21% 29.66% 13.94% 11.26% Lockheed Martin Corporation Common Stock 18.37% 29.86% 14.10% 11.51% ESOP Fund Hourly (HSP and BBP only) 4 / Non-Diversified Domestic Equity 18.21% 29.56% 13.92% 15.13% Lockheed Martin Corporation Common Stock 18.37% 29.86% 14.10% 15.36% Bond Funds Broad Market Bond Index Fund / Fixed Income 2.50% 2.14% 4.24% 4.65% Barclays U.S. Aggregate Bond Index 2.65% 2.23% 4.34% 4.70% High Yield Bond Fund / Fixed Income 13.24% N/A N/A 3.71% BofAML HYM Master II Constrained Index 17.49% N/A N/A 4.79% Other Government Short Term Investment Fund / Short Term Fixed Income 0.30% 0.08% N/A 0.07% Bank of America Merrill Lynch 3mth US T-Bill Index 0.33% 0.12% N/A 0.12% Stable Value Fund / Stable Value 1.66% 1.34% 2.13% 3.33% imoneynet MF Avg/All Taxable Index 0.13% 0.04% 0.71% 2.29% Treasury Inflation-Protected Securities (TIPS) Fund / Inflation-Protected Fixed Income 5.05% 0.88% N/A 3.16% Barclays U.S. Inflation-Linked Bond Index 5.10% 0.98% N/A 3.28% Target Date Fund 2005 / Target Date Fund 5.26% 4.55% N/A 3.06% Target Date 2005 Blended Index % 4.27% N/A 2.75% Target Date Fund 2010 / Target Date Fund 5.93% 4.81% N/A 3.04% Target Date 2010 Blended Index % 4.61% N/A 2.80% Target Date Fund 2015 / Target Date Fund 6.51% 5.26% N/A 2.94% 2

19 Target Date 2015 Blended Index % 5.14% N/A 2.79% Target Date Fund 2020 / Target Date Fund 7.06% 5.89% N/A 2.86% Target Date 2020 Blended Index % 5.85% N/A 2.81% Target Date Fund 2025 / Target Date Fund 7.56% 6.56% N/A 2.67% Target Date 2025 Blended Index % 6.61% N/A 2.73% Target Date Fund 2030 / Target Date Fund 8.09% 7.26% N/A 2.56% Target Date 2030 Blended Index % 7.41% N/A 2.75% Target Date Fund 2035 / Target Date Fund 8.53% 7.80% N/A 2.59% Target Date 2035 Blended Index % 8.02% N/A 2.85% Target Date Fund 2040 / Target Date Fund 8.52% 7.93% N/A 2.66% Target Date 2040 Blended Index % 8.13% N/A 2.90% Target Date Fund 2045 / Target Date Fund 8.50% 7.95% N/A 2.69% Target Date 2045 Blended Index % 8.15% N/A 2.92% Target Date Fund 2050 / Target Date Fund 8.50% 7.97% N/A 2.70% Target Date 2050 Blended Index % 8.16% N/A 2.93% Target Date Fund 2055 / Target Date Fund 8.50% 7.97% N/A 6.19% Target Date 2055 Blended Index % 8.17% N/A 6.41% Target Date Fund 2060 / Target Date Fund 8.50% N/A N/A 3.08% Target Date 2060 Blended Index % N/A N/A 2.79% Notes 1. Returns included for the funds are net of certain management and administrative expenses and do not necessarily reflect any increases or decreases of an individual participant s account. The growth of each participant s account may vary due to participant transactions such as contributions, fund transfers, withdrawals, etc. 2. The returns are rolling, annualized rates of return. 3. Comparative benchmark indices are included for reference only and do not impact participant balances. The benchmark indices do not include any expenses. 4. Returns for the Company Common Stock Fund and the ESOP Fund include the effects of dividends and changes in prices. 5. The benchmark for the Target Date Funds is a customized benchmark that uses index returns to represent performance of the asset classes. The benchmark returns are calculated by weighting the monthly index returns of each asset class by each Target Date Fund's target allocation for each asset class. Target allocations adjust quarterly in accordance with the Target Date Funds' Glide Path. For 2016, the benchmarks in the table below were used to calculate the Target Date Funds blended benchmark: 3

20 Asset Class: Benchmark Allocation Target Date Funds U.S. Large Cap Stocks: Russell 1000 Index 11.94% 13.72% 15.54% 17.92% 20.32% 23.00% 25.70% 26.76% 26.80% 26.80% 26.80% 26.80% U.S. Small/Mid-Cap Stocks: Russell 2000 Index 1.50% 2.00% 2.62% 3.50% 4.56% 5.90% 7.34% 8.56% 9.00% 9.00% 9.00% 9.00% Non-U.S. Stocks: MSCI EAFE Index 7.64% 8.92% 10.30% 12.70% 15.82% 19.68% 24.10% 27.52% 28.60% 28.60% 28.60% 28.60% Emerging Markets Stocks: MSCI Emerging Markets Index 1.32% 1.52% 1.78% 2.38% 3.18% 4.22% 5.54% 6.76% 7.20% 7.20% 7.20% 7.20% Stable Value Fund: imoneynet MF Avg/All Taxable 19.80% 17.80% 15.80% 12.60% 8.90% 5.40% 1.60% 0.00% 0.00% 0.00% 0.00% 0.00% U.S. Core Bonds: Bloomberg Barclays U.S. Aggregate Bond Index 25.40% 18.80% 14.80% 13.40% 11.80% 9.20% 6.80% 5.40% 5.00% 5.00% 5.00% 5.00% Inflation-Protected Bonds: Bloomberg Barclays U.S. Government Inflation- Linked Bond Index 20.00% 20.00% 17.00% 12.30% 8.70% 4.80% 1.20% 0.00% 0.00% 0.00% 0.00% 0.00% Emerging Markets Bonds: JPMorgan EMBI Global Diversified Index 0.00% 0.60% 1.60% 2.60% 3.00% 3.00% 3.00% 1.20% 0.00% 0.00% 0.00% 0.00% High Yield Bonds: BofA Merrill Lynch U.S. High Yield II Constrained Index 1.20% 2.60% 3.60% 4.00% 4.00% 4.00% 2.80% 0.80% 0.00% 0.00% 0.00% 0.00% Commodities: Bloomberg Commodity Index Total Return 2.50% 2.92% 3.68% 4.00% 4.06% 4.10% 4.16% 4.20% 4.20% 4.20% 4.20% 4.20% Direct Global Real Estate/REIT Securities: FTSE EPRA/NAREIT Developed Real Estate Index 2.50% 2.92% 3.68% 4.00% 4.06% 4.10% 4.16% 4.20% 4.20% 4.20% 4.20% 4.20% Balanced Risk Allocation: U.S. CPI (Consumer Price Index) + 3% 6.20% 8.20% 9.60% 10.60% 11.60% 12.60% 13.60% 14.60% 15.00% 15.00% 15.00% 15.00% S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. Russell is a registered trademark of Russell Investments. MSCI EAFE is a registered trademark of MSCI, Inc. MSCI Emerging Markets Index is a registered trademark of MSCI, Inc. 4

21 Part II. Fee and Expense Information Table 2 shows fee and expense information for the Plan investment options for Included in Table 2 are: Total Annual Operating Expenses - expenses paid indirectly from your investment in each option, expressed as a percentage of the value of an investment in such option and a dollar amount per $1000 of investment. The Total Annual Operating Expenses below include fees for investment management, recordkeeping, trustee services, investment oversight, fund operations and target date fund services (where applicable), and certain other minor expenses, and are allocated among individual accounts in proportion to each account balance. Shareholder-type Fees a description of any fees paid directly from your investment in each option (e.g. sales loads, redemption fees, surrender charges) and any transfer restrictions. These fees are in addition to Total Annual Operating Expenses. Table 2 - Fees and Expenses Name / Type of Option Total Annual Operating Expenses Shareholder-Type Fees / Investment Restrictions Equity Funds As a % Per $1000 S&P 500 Indexed Equity Fund / Large Blend 0.04% $0.38 N/A U.S. Equity Fund / Large Blend 0.44% $4.42 N/A Small / Mid Cap Indexed Equity Fund / Small Mid-Cap Blend 0.06% $0.57 N/A Global Equity Fund / Large Blend 0.47% $4.65 N/A Int l Developed Markets Equity Fund / Large Blend 0.11% $1.05 N/A MSCI EAFE Indexed Equity Fund / Foreign Large Blend 0.10% $0.97 N/A Global Real Estate Fund / Global Real Estate 0.79% $7.92 N/A Emerging Markets Indexed Equity Fund / Foreign Large Blend 0.15% $1.49 N/A Commodities Fund / Commodities Broad Basket 0.06% $0.58 N/A Company Common Stock Fund / Non-Diversified Domestic Equity 0.05% $0.53 N/A ESOP Fund (SSP only) / Non-Diversified Domestic Equity 0.05% $0.54 N/A ESOP Fund (HSP and BBP only) / Non-Diversified Domestic Equity 0.04% $0.43 N/A Leidos Fund 0.00% $0.03 N/A Bond Funds Broad Market Bond Index Fund / Fixed Income 0.06% $0.58 N/A High Yield Bond Fund / Fixed Income 0.53% $5.28 N/A Other Government Short Term Investment Fund / Short Term Fixed Income 0.06% $0.59 Stable Value Fund / Stable Value 0.29% $2.91 Amounts transferred out of the SDBA, TIPS Fund or the Government Short Term Investment Fund cannot be directly transferred into the Stable Value Fund; instead they must be transferred to the Plan s Core Investment Options and/or Target Date Funds for at least 90 days before being transferred to the Stable Value Fund. Amounts transferred out of the Stable Value Fund cannot be directly transferred to the SDBA, TIPS Fund, or Government Short Term Investment Fund; instead they must be transferred to the Plan s Core Investment Options and/or Target Date Funds for at least 90 days before being transferred to the SDBA, TIPS Fund, or Government Short Term Investment Fund. 5

22 Name / Type of Option Other (continued) Table 2 - Fees and Expenses (continued) Total Annual Operating Expenses As a % Per $1000 Shareholder-Type Fees / Investment Restrictions Treasury Inflation-Protected Securities (TIPS) Fund / Inflation-Protected Fixed Income 0.06% $0.58 Amounts transferred out of the SDBA, TIPS Fund or the Government Short Term Investment Fund cannot be directly transferred into the Stable Value Fund; instead they must be transferred to the Plan s Core Investment Options and/or Target Date Funds for at least 90 days before being transferred to the Stable Value Fund. Target Date Fund 2005 / Target Date Fund 0.28% $2.83 N/A Target Date Fund 2010 / Target Date Fund 0.30% $3.04 N/A Target Date Fund 2015 / Target Date Fund 0.33% $3.31 N/A Target Date Fund 2020 / Target Date Fund 0.36% $3.57 N/A Target Date Fund 2025 / Target Date Fund 0.38% $3.78 N/A Target Date Fund 2030 / Target Date Fund 0.40% $4.02 N/A Target Date Fund 2035 / Target Date Fund 0.42% $4.22 N/A Target Date Fund 2040 / Target Date Fund 0.42% $4.19 N/A Target Date Fund 2045 / Target Date Fund 0.42% $4.16 N/A Target Date Fund 2050 / Target Date Fund 0.42% $4.16 N/A Target Date Fund 2055 / Target Date Fund 0.42% $4.18 N/A Target Date Fund 2060 / Target Date Fund 0.42% $4.20 Self-Directed Brokerage Account (SDBA) 0.03% $0.33 Expenses are determined daily based upon the market value of the SMA and will be charged monthly to the Core Fund and Target Date Fund balances as a reduction in applicable units owned. Amounts transferred out of the SDBA, TIPS Fund or the Government Short Term Investment Fund cannot be directly transferred into the Stable Value Fund; instead they must be transferred to the Plan s Core Investment Options and/or Target Date Funds for at least 90 days before being transferred to the Stable Value Fund. The cumulative effect of fees and expenses can substantially reduce the growth of your retirement savings. Visit the U.S. Department of Labor s Web site for an example showing the long-term effect of fees and expenses at There are many factors in addition to fees and expenses that you should consider when you decide to invest in a savings plan option. For example, you may also want to consider whether an investment in a particular option, along with your other investments, will help you achieve your financial and retirement goals. Additionally, each investment option offered has various risks, such as interest rate risk and market and credit risk. You may also want to consider your number of years before retirement and your own level of investment knowledge. There is no guarantee that a particular fund s objective will be met. 6

23 July 10, 2017 Summary of Material Modifications Notice of Changes in Investment Options Fees and Expenses This document provides information on changes in the following Lockheed Martin Corporation (LMC) savings plans: LMC Salaried Savings Plan (SSP) LMC Hourly Employee Savings Plan Plus (HSP) LMC Basic Benefit Plan for Hourly Employees (BBP) LMC Operations Support Savings Plan (OSSP) LMC Performance Sharing Plan for Bargaining Employees (PSP) LMC Capital Accumulation Plan (CAP) LMC Capital Accumulation Plan for Hourly Employees (HCAP) This document is called a Summary of Material Modifications (SMM) to the official plan summary, known as the Summary Plan Description (SPD), which includes the Investment Options Guide. Overview of Changes Included in this document is information about changes to the Fees and Expenses for the Self- Directed Brokerage Account (SDBA). SDBA Fees and Expenses Effective April 3, 2017, TD Ameritrade, the SDBA provider, lowered the cost of SDBA equity and ETF internet orders to $4.95. (Effective March 6, 2017, TD Ameritrade had universally lowered the cost of equity and ETF internet orders from $8.95 to $6.95.) Also effective April 3, 2017, TD Ameritrade lowered the cost of SDBA no-load mutual funds from $25.00 to $9.95 (vs. $19.95 universally). In conjunction with these cost decreases, TD Ameritrade s revenue sharing payments will be correspondingly reduced. Effective April 1, 2017, this revenue is credited to SDBA participants prorata based on each participant s SDBA balance. Previously the revenue was used to reduce the plans administrative expenses. Effective June 1, 2017, the SDBA will no longer allow investments in Master Limited Partnerships (MLPs) and certain other pass-through investments. These investments can generate income and required tax filings that may result in adverse tax consequences for the Lockheed Martin savings plans. Participants with existing holdings in these investments will not be required to sell their existing holdings as a result of this change. (continued) 110SMMS17

24 Additional information or assistance Please review this information and file with your important savings plan documents. If you have any questions about this document, or to obtain a copy of the current SPD or Investment Options Guide: Access the Savings Plan Web Tool o > Pay and Benefits > Savings Plan via the Intranet o > Pay and Benefits > Savings Plan via the Internet o Call the Savings Plan Information Line and speak to a customer service representative Monday through Friday, 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays o toll free from within the U.S. o from outside the U.S. o for TDD communication services the hearing impaired 2

25 July 10, 2017 Summary of Material Modifications Notice of Change in Contribution Limits This document provides information regarding changes to the Lockheed Martin Corporation Salaried Savings Plan (SSP). This document is called a Summary of Material Modifications (SMM) to the official plan summary, known as the Summary Plan Description (SPD). Description of Change Effective Oct. 14, 2016, the contribution percentage limits have increased as follows (but are subject to applicable Internal Revenue Code limitations, which will continue to apply): Plan Name Old Limits New Limits Salaried Savings Plan 25% total 40% total You may contribute up to 40% on a before-tax, Roth 401(k) or after-tax basis, or any combination of the three up to a total of 40% of your Base Pay. However, the 2017 IRS 402(g) limit of $18,000 ($24,000 if age 50 or older) will continue to apply. Additional information or assistance Please review this information and file with your important savings plan documents. If you have any questions about this document, or to obtain a copy of the current SPD and/or Investment Options Guide: Access the Savings Plan Web Tool o > Pay and Benefits > Savings Plan via the Intranet o > Pay and Benefits > Savings Plan via the Internet o Call the Savings Plan Information Line and speak to a customer service representative Monday through Friday, 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays o toll free from within the U.S. o from outside the U.S. o for TDD communication services the hearing impaired 111SMMS17

26 July 10, 2017 Summary of Material Modifications Notice of Change to In-Plan Roth Conversion Fee This document provides information on changes in the following Lockheed Martin Corporation (LMC) savings plans: LMC Salaried Savings Plan (SSP) LMC Hourly Employee Savings Plan Plus (HSP) LMC Operations Support Savings Plan (OSSP) LMC Performance Sharing Plan for Bargaining Employees (PSP) This document is called a Summary of Material Modifications (SMM) to the official plan summary, known as the Summary Plan Description (SPD). In Plan Roth Conversion Fee Reduction The fee charged to participant plan accounts for each in-plan Roth conversion was reduced from $200 to $100 effective December 1, Please remember that the decision to make an in-plan Roth conversion is extremely complex, and an in-plan Roth conversion and any tax owed on the conversion are irrevocable. It is strongly recommended that you consult your financial and/or tax advisor if you are considering an in-plan Roth conversion. Please refer to your SPD for more important information regarding in-plan Roth conversions. Additional information or assistance Please review this information and file with your important savings plan documents. If you have any questions about this document, or to obtain a copy of the current SPD and/or Investment Options Guide: Access the Savings Plan Web Tool o > Pay and Benefits > Savings Plan via the Intranet o > Pay and Benefits > Savings Plan via the Internet o Call the Savings Plan Information Line and speak to a customer service representative Monday through Friday, 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays o toll free from within the U.S. o from outside the U.S. o for TDD communication services the hearing impaired 115SMMS17

27 July 10, 2017 Saving Plan Statements Delivered Electronically By Default Although electronic delivery (e-delivery) of savings plan account statements has been an option for several years, the default for most Lockheed Martin Corporation (LMC) savings plan participants has been postal delivery of quarterly and/or annual participant account statements. Postal delivery of savings plan account statements requires the printing and mailing of over a million sheets of paper each year in order to deliver statements that, by the time they are received, no longer reflect the participants current account balances. Therefore, effective immediately, quarterly statements for all Lockheed Martin Corporation qualified and non-qualified savings plans will be provided via e-delivery and will be available on the Savings Plan Web Tool. With e-delivery, you can: View quarterly statements whenever you need them, 24/7. Reduce the clutter of paper statements and feel secure that they haven t been lost in the mail. Stop worrying about storing or losing past statements. All of your current and historical statements for the past 24 months are available online. Receive an notification when a new statement or other correspondence is available. Online access to your quarterly account statements Your quarterly account statement is available anytime through the Savings Plan Web Tool. Simply log-in, (see below) and visit the Statements and Documents section (on the main menu bar) to view your most recent statement as well as previous statements and accompanying notices for the past 24 months. Right to request a paper account statement You have the right to request to have an account statement printed and mailed to you at no charge. This can be done by calling the Savings Plan Information Line and speaking to a customer service representative. Create an account statement - anytime You can also create a statement using the Savings Plan Web Tool for any available period you choose. Access the savings plan you want a statement for and then select View Statements from the Quick Access menu. Alternatively, you can select Account then Statement from the main menu bar. To opt-out of e-delivery If you prefer to receive quarterly paper statements mailed to you, you can do so by updating your delivery method on the Savings Plan Web Tool under My Profile > Communication Preferences at any time or by calling the Savings Plan Information Line. (continued) 116NotS17

28 For more assistance If you have any questions regarding this document: Access the Savings Plan Web Tool o > Pay and Benefits > Savings Plan via the Intranet o > Pay and Benefits > Savings Plan via the Internet o Call the Savings Plan Information Line and speak to a customer service representative Monday through Friday, 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays o toll free from within the U.S. o from outside the U.S. o for TDD communication 116NotS17

29 August 3, 2016 Summary of Material Modifications Notice of Changes to the Treasury Inflation Protected Securities Fund and the Treasury Inflation-Protected Securities Asset Class in the Target Date Funds This document provides information on changes to the Treasury Inflation-Protected Securities Fund and the Treasury Inflation-Protected Securities asset class in the Target Date Funds offered in the following Lockheed Martin Corporation (LMC) savings plans: LMC Salaried Savings Plan LMC Hourly Employee Savings Plan Plus LMC Basic Benefit Plan for Hourly Employees LMC Operations Support Savings Plan LMC Performance Sharing Plan for Bargaining Employees LMC Supplemental Savings Plan LMC Capital Accumulation Plan LMC Capital Accumulation Plan for Hourly Employees LMC Deferred Management Incentive Compensation Plan LMC Nonqualified Capital Accumulation Plan This document is called a Summary of Material Modifications (SMM) to the official plan summary, known as the Summary Plan Description (SPD), which includes the Investment Options Guide. About this notice The purpose of this SMM is to inform you of changes to the TIPS Investments held in the savings plans. The Lockheed Martin savings plans offer a wide variety of investment options to help their participants achieve a secure financial future. One of the savings plans investment options is the Treasury Inflation-Protected Securities Fund (the TIPS Fund ). Additionally, the savings plans offer the Target Date Funds, which have investments in Treasury Inflation-Protected Securities (together with the TIPS Fund, the TIPS Investments ). Treasury Inflation-Protected Securities Benchmark and Asset Composition Inflation-protected public obligations of the U.S. Treasury, commonly known as TIPS, are designed to provide inflation protection to investors. TIPS are income-generating instruments whose interest and principal payments are adjusted for inflation a sustained increase in prices that erodes the purchasing power of money. Currently, the savings plans performance benchmark for the TIPS Investments is the Barclays U.S. Government Inflation-Linked Bond Index. Effective October 1, 2016, the TIPS benchmark will be the 104kSMMs16

30 Barclays U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L). This benchmark change will affect the composition of the TIPS Investments held in the savings plans. The Barclays U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L) (the TIPS Index ) includes all publicly-issued U.S. TIPS that have at least one year remaining to maturity, are rated investment-grade (BAA3 BBB- BBB- or higher) and have at least $250 million of outstanding face value. In addition, the securities in the TIPS Index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. TIPS held in the Federal Reserve System Open Market Account (both purchases at issuance and net secondary market transactions) are deducted from the total amount outstanding. The TIPS Index is market capitalization-weighted. The securities held in the TIPS Index are updated on the last calendar day of each month. As the composition of the TIPS Index changes based on issuance by the U.S. Treasury, the maturity and the characteristics of the securities composing the TIPS Investments held in the savings plans will also change. It is not intended for the TIPS Investments to earn returns in excess of the TIPS Index. Expenses The investment management fees and related investment contract expenses for the TIPS Fund may vary from approximately.03% to.05% of Fund assets annually. Investment Manager Lockheed Martin Investment Management Company (LMIMCo), a wholly owned subsidiary of Lockheed Martin Corporation, directs the overall asset allocation of the TIPS Investments in the savings plans. LMIMCo has retained the following manager to manage the TIPS Investments in the savings plans: BlackRock Financial Management, Inc. LMIMCo may change managers at any time without notice to participants. Special Transfer Restrictions Applicable to the Stable Value Fund Amounts that are transferred out of the Stable Value Fund must remain invested in a Core or Target Date Fund for at least 90 days before they can be transferred into the TIPS Fund, the Government Short Term Investment Fund or the Self-Directed Brokerage Account. Additional information or assistance Please review this information and file with your important savings plan documents. If you have any questions about this document: Access the Savings Plan Web Tool by visiting LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan. Or, go directly to Call the Savings Plan Information Line toll-free at From outside the U.S. dial Customer service representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays. For TDD communication services for the hearing impaired, call

31 Summary of Material Modifications Notice of Change in Investment Options Feb. 29, 2016 This document provides information on changes in the following Lockheed Martin Corporation (LMC) savings plans: LMC Salaried Savings Plan (SSP) LMC Hourly Employee Savings Plan Plus (HSP) LMC Basic Benefit Plan for Hourly Employees (BBP) LMC Operations Support Savings Plan (OSSP) LMC Performance Sharing Plan for Bargaining Employees (PSP) LMC Capital Accumulation Plan (CAP) LMC Capital Accumulation Plan for Hourly Employees (HCAP) LMC Deferred Management Incentive Compensation Plan (DMICP) LMC Nonqualified Capital Accumulation Plan (NCAP) LMC Supplemental Savings Plan (NQSSP) This document is called a Summary of Material Modifications (SMM) to the official plan summary, known as the Summary Plan Description (SPD), which includes the Investment Options Guide. About this Notice The purpose of this SMM is to inform you of changes to the Glide Path of the Target Date Funds, which are twelve custom-designed investment options offered to participants in the Savings Plans listed above. Each Target Date Fund (TDF), which comprises a mix of underlying separate stock, bond and other asset class portfolios, is designed to be a complete, diversified investment program appropriate for a particular time horizon based on an anticipated retirement date. The Glide Path refers to the mix of various asset classes (e.g., stocks, bonds, diversifiers) in each of the TDFs. The Glide Path gradually adjusts across the portfolio of investments considered appropriate for your age according to a preset schedule designed and monitored by investment professionals. The Glide Path changes discussed here will impact the asset mix of each TDF. Glide Path Change for Target Date Funds Effective April 1, 2016, the Glide Path of the TDFs will be modified. While there are several asset classes within the TDFs (e.g., domestic equity, international equity, fixed income, commodities, stable value, real estate, etc.), the only asset classes impacted by this change are domestic equity and international equity. Specifically, the allocation to domestic equity will increase while the allocation to international equity will correspondingly decrease. The magnitude of the allocation shift from international equity to domestic equity differs by TDF, ranging from approximately 2% for TDF2005 to approximately 4% for TDF2060. More details regarding the new Glide Path can be found in the following updated pages of the Investment Options Guide for the Lockheed Martin Corporation Savings Plans: 200gSPIOG Target Date Funds Overview (March, 2016) 200hSPIOG Investment Options Fact Sheet Target Date Funds (March, 2016) These pages also update information provided in the Plan Guides for the Lockheed Martin Corporation Deferred Management Incentive Compensation Plan (DMICP), the Lockheed Martin 104-eSMMS16

32 Corporation Nonqualified Capital Accumulation Plan (NCAP) and the Lockheed Martin Corporation Supplemental Savings Plan (NQSSP). Fee and Expense Information While the Glide Path changes will impact the investment management fees for each TDF, the impact is expected to be relatively insignificant. As a result, there is no change to the range of investment management fees reported for each TDF in Appendix C of the Investment Options Guide. Additional Information or Assistance Please review this information and file with your important savings plan documents. If you have any questions about this document: Access the Savings Plan Web Tool by visiting LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan. Or, go directly to Call the Savings Plan Information Line toll-free at From outside the U.S. dial Customer service representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays. For TDD communication services for the hearing impaired, call eSMMS16

33 LOCKHEED MARTIN CORPORATION SAVINGS PLANS INVESTMENT OPTIONS GUIDE THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF This material is provided for information purposes and should not be construed as investment advice.

34 Lockheed Martin Corporation Savings Plans Investment Options Guide Important Notes This Investment Options Guide ( Guide ) summarizes the investment options available for the Lockheed Martin Corporation ( LMC ) savings plans (the Plans or the Plan ) listed below as of September 1, 2015 and may be updated from timeto-time thereafter. LMC Salaried Savings Plan (SSP) LMC Hourly Employee Savings Plan Plus (HSP) LMC Basic Benefit Plan for Hourly Employees (BBP) LMC Operations Support Savings Plan (OSSP) LMC Performance Sharing Plan for Bargaining Employees (PSP) All investment options may contain cash reserves in order to provide liquidity for participant transactions. Cash reserves are managed by State Street Global Advisors, a division of State Street Bank and Trust Company, except where the investment option is a mutual fund, in which case the cash reserves are managed by the mutual fund manager. With the exceptions of the Employee Stock Ownership Plan (ESOP) Fund (available only in the SSP, HSP and BBP) and the Company Common Stock Fund, the investment options may invest in derivative securities for hedging, liquidity or asset allocation purposes. The investment risk associated with these derivatives may differ from that of the investment options. For mutual fund investment options, you can review the fund prospectus for information on the use of derivatives in each fund. LMC Capital Accumulation Plan (CAP) LMC Capital Accumulation Plan for Hourly Employees (HCAP) For a copy of your savings plan s SPD, access the Savings Plan Web Tool or call the Savings Plan Information Line. This Guide along with separate booklets describing Plan features constitute the Summary Plan Description ( SPD ) for the Plans listed above. It replaces the Investment Options Guide effective November 2013 and any subsequent Summaries of Material Modifications ( SMM ). However, the plan related information in the SPDs and SMMs continues to apply. You can review the SPDs and SMMs and all other information about the Plans, including, but not limited to, additional information on Plan investments, which include: the mechanics for making investment choices, the procedures in the event of a market disruption, the voting rights with respect to investment options, Plan trading restrictions, and individual participant responsibility for making investment choices. Lockheed Martin Corporation and its subsidiaries (the Company ), the Plan Trustee, and other Plan fiduciaries are not responsible for your investment choices or investment losses resulting from such choices, pursuant to section 404(c) of the Employee Retirement Income Security Act of 1974, as amended (ERISA), and section c-1 of the Code of Federal Regulations, to which the Plans adhere. The Company does not guarantee the performance of these investment funds and is not liable for any losses you may experience due to investment performance. This Guide does not create a contract of employment between the Company and any employee. Nothing in this Guide prevents the Company from terminating or changing the terms of any employee s employment. The Plans are expected to continue indefinitely. However, the Company, by action of the Board of Directors or its authorized delegate, reserves the right to amend, suspend or terminate the Plans at September bSPIOG

35 Lockheed Martin Corporation Savings Plans Investment Options Guide any time. Any amendment, suspension or termination will be made by an instrument signed by the Company. The information contained in this Guide is not legal or tax advice and should not be considered as such. The tax rules are complicated and their impact may differ depending on each individual s specific circumstances. Please consult with your legal or tax advisor regarding your specific situation. Each Plan s terms are set forth in the official plan document and cannot be modified by the contents of this Guide or other written or oral statements from any Lockheed Martin Corporation employee or representative. Where conflicts exist, the terms as set forth in the official plan document govern. Savings Plan Web Tool The Savings Plan Web Tool is a secure online resource that allows you to obtain account and Plan information 24 hours a day, seven days a week. Savings Plan Information Line You can check the status of your account, perform account transactions, and obtain more details about the features and benefits of the Plans by calling the Savings Plan Information Line at: Toll-free within the U.S.: From outside the U.S.: For TDD communication services for the hearing impaired: You will need your password and either your LM People ID or your Social Security number to access your account information. The automated phone system is available 24 hours a day, seven days a week. Customer service representatives are available Monday through Friday 8 a.m. to 8 p.m. Eastern time, except on New York Stock Exchange holidays. Access the Savings Plan Web Tool via LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plans. If you do not have access to LM People, log on to the Savings Plan Web Tool at You will need your Social Security number or LM People ID and password to access your account through this URL.

36 Lockheed Martin Corporation Savings Plans Investment Options Guide Federal Securities Law/Prospectus United States securities laws require the Company to provide Participants with specific information concerning the Plans and their operation. This information is provided in several documents known collectively as a prospectus. Securities and Exchange Commission (SEC) rules allow the Company to incorporate by reference into the prospectus information it files with the SEC. This means the Company can disclose important information to you by referring to those documents. Information incorporated by reference is an important part of this SPD and the prospectus, and information subsequently filed by the Company with the SEC automatically updates this information as well as information in this SPD and the prospectus. The following documents collectively make up the prospectus for the Plans: The Plan documents as amended and restated from time to time; The SPDs for the Plans; The registration statement of which the prospectus is a part and the documents incorporated by reference into the registration statement, which means that the registration statement refers you to additional important documents that have been filed separately with the SEC. In addition, all documents and reports filed by the Company with the SEC subsequent to the date of this prospectus pursuant to Section 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 (Exchange Act) (except, with respect to Current Reports on Form 8-K, any information that is furnished) are deemed to be incorporated by reference in the registration statement. You can find these documents on the SEC's website at or at the Company s website at You can also obtain copies of any of these documents, without charge, by making an oral or written request to the Corporate Secretary as follows: Senior Vice President, General Counsel and Corporate Secretary Lockheed Martin Corporation 6801 Rockledge Drive Bethesda, MD (301) No person has been authorized to give any information or to make any representations, other than those contained in this prospectus, in connection with the offer contained in this prospectus, and, if given or made, such information or representations must not be relied upon as having been authorized by the Company. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any interests or Common Stock in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. Neither the delivery of this prospectus nor any sale made hereunder will under any circumstances create any implication that there has been no change in the affairs of the Company or in the Plans since the date hereof, or that the information contained or incorporated by reference herein is correct as of any time subsequent to its date. Neither the SEC nor any state securities commission has approved or disapproved of these interests or the Company common stock investment measures in the Plans, or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The information contained in this prospectus may not be current after the date of this prospectus. If the prospectus is substantially amended, the Company will provide to you the documents to update the prospectus. These documents will contain a notation similar to the notation in the box (continued) September cSPIOG

37 Lockheed Martin Corporation Savings Plans Investment Options Guide on the front of this Guide indicating that the new documents are part of the prospectus. You should rely only on (1) the information contained in this prospectus, (2) any future documents provided to you updating this prospectus, or (3) information that we have referred you to in any part of the prospectus. Any questions about day-to-day administration of the Plans should be directed to the Savings Plan Information Line at Any other questions concerning the Plans should be directed to: Vice President, Benefits Lockheed Martin Corporation 6801 Rockledge Drive CCT-115 Bethesda, MD Any questions that you have concerning trading in the Company s securities may be directed to: Vice President and Associate General Counsel Corporate Securities Lockheed Martin Corporation 6801 Rockledge Drive MP 233 Bethesda, MD

38 Lockheed Martin Corporation Savings Plans Investment Options Guide Important Information about the Qualified Default Investment Alternative Default Investment for your Plan The Target Date Funds ( TDF s) are a series of investment options explained later in this booklet, that have been chosen by your plan sponsor/plan fiduciary as the Qualified Default Investment Alternative (QDIA) for the savings plans. Automatic Investment of Contributions If you are a new participant in a Lockheed Martin savings plan and you do not select any of the investment options available under your plan, your contributions and any Company contributions in the SSP for which you may be eligible (other than the SSP Company match, which is automatically invested in the Employee Stock Ownership Plan (ESOP) Fund), will be invested automatically in the TDF based on your birth date, per the following table: Target Date Funds Birth Date Ranges Fund Name Birth Date Range Target Date Fund 2060 January 1, 1993 or after Target Date Fund 2055 January 1, December 31, 1992 Target Date Fund 2050 January 1, 1983 December 31, 1987 Target Date Fund 2045 January 1, 1978 December 31, 1982 Target Date Fund 2040 January 1, 1973 December 31, 1977 Target Date Fund 2035 January 1, 1968 December 31, 1972 Target Date Fund 2030 January 1, 1963 December 31, 1967 Target Date Fund 2025 January 1, 1958 December 31, 1962 Target Date Fund 2020 January 1, 1953 December 31, 1957 Target Date Fund 2015 January 1, 1948 December 31, 1952 Target Date Fund 2010 January 1, 1943 December 31, 1947 Target Date Fund 2005 December 31, 1942 or before Default Investment Exceptions Exceptions to the default investments noted above: Prior to 1/1/2007, the default investment was the Stable Value Fund For participants born after December 31, 1987, the default investment option during the period 1/1/2007 to 1/3/2010 was TDF 2050 For participants born after December 31, 1992, the default investment option during the period 1/4/2010 to 1/1/2015 was TDF 2055 If one of these exceptions applies to you, please note your account balance and future contributions will continue to be invested in the default investment option until you make a change to your future investment election. September 2015 Right to Direct Investment out of the QDIA Even if your account is invested in the QDIA because you did not provide affirmative investment directions, you have the right to discontinue your investment in the QDIA and to direct the investment of your account balance into one or more of the other investment options available to you under the Plan. For the 120-day period beginning on the date of your initial default investment into the QDIA, you are entitled to transfer the amount automatically invested in the QDIA to the other investment options without incurring any fees or expenses (other than ongoing fees and expenses incurred in connection with the operation of the Target Date Funds) and without being subject to any restrictions (such as the otherwise applicable restriction from reinvesting in a Target Date Fund for 30 days after transferring out of that investment option). 200dSPIOG

39 Lockheed Martin Corporation Savings Plans Investment Options Guide The plan provision permitting a maximum of 12 trades per calendar year (with at least one trade per calendar quarter and one final trade opportunity to the Stable Value Fund at the end of the calendar year) will continue to apply. After the initial 120-day period, you are entitled to transfer the amount automatically invested in the QDIA to the other investment options without incurring any fees or expenses and without being subject to any restrictions other than the restrictions that are generally applicable to transfers out of the Target Date Funds. Information about the other investment options is contained in this Guide. You may change your investment elections at any time by calling the Savings Plan Information Line or by accessing the Savings Plan Web Tool.

40 Lockheed Martin Corporation Savings Plans Investment Options Guide Your Investment Options at a Glance You have the right to invest your account in any of the investment options available in your savings plan. The investment options that are right for you depends on your goals, retirement timeframe, feelings about risk, and your level of investment knowledge. To properly invest for retirement, you need the flexibility that comes from having a range of choices. That s why your savings plan offers three distinct categories of investment options. Investment Option Target Date Funds Fund Type Target Date Core Funds Government Short Term Investment Fund Stable Value Fund Treasury Inflation-Protected Securities (TIPS) Fund Broad Market Bond Index Fund S&P 500 Indexed Equity Fund U.S. Equity Fund Small / Mid-Cap Indexed Equity Fund Global Equity Fund International Developed Markets Equity Fund MSCI EAFE Indexed Equity Fund Global Real Estate Fund Emerging Markets Indexed Equity Fund High Yield Bond Fund Commodities Fund Company Common Stock Fund ESOP Fund* Domestic Short Term Fixed Income Stable Value Domestic Inflation-Protected Fixed Income Index Domestic Fixed Income Index Domestic Stock Index Domestic All Cap Stock Domestic Small/Mid-Cap Stock Index Global Stock Foreign Stock Foreign Stock Index Global Real Estate Securities Foreign Emerging Stock Index High Yield Fixed Income Commodities Non-Diversified Domestic Stock Non-Diversified Domestic Stock Self-Directed Brokerage Account Self-Directed Brokerage Account S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. MSCI EAFE is a registered trademark of MSCI Inc. *Available in the SSP, HSP and BBP only. Lockheed Martin Investment Management Company (LMIMCo), a wholly owned subsidiary of Lockheed Martin Corporation, located at 6901 Rockledge Drive, Bethesda, MD 20817, provides overall management of the investment options in the savings plans. LMIMCo often appoints external investment managers to manage the investment options and may add to or replace one or more of these managers at any time without notice to participants. Additional Fund Information You may obtain Morningstar Profile investment summaries for each investment option in your plan on the Savings Plan Web Tool. These Profiles contain specific investment information and are updated on a quarterly basis. In addition, the Glossary of Investment Terms, also available on the Savings Plan Web Tool, provides definitions of common investment and financial terms relevant to the investment options in the Plan. September eSPIOG

41 Lockheed Martin Corporation Savings Plans Investment Options Guide Four Ways to Invest 1. Target Date Funds Designed for people who want a simple and effective option that leaves most ongoing investment decisions to investment professionals. 2. Core Funds Mix & Monitor Designed for people who want to take a more hands-on approach and select their own mix of investment options. Discover Which Way is Right for You Ask yourself these questions: 1. Do I have the desire to select my own mix of individual funds? 2. Am I comfortable deciding how much to invest in each fund? 3. Will I take the time to rebalance regularly, monitor my investments and make changes as I get closer to retirement? If you answer No to these questions, then the Target Date Funds may be appropriate for you. If you answer Yes to one or more of the questions, then Mix & Monitor may be right for you. 3. Self-Directed Brokerage Account If you are an experienced investor who has an understanding of the securities markets and are willing to take on more responsibility and risk for managing individual investments, the Self Directed Brokerage Account allows you to do so. The Voya Retirement Advisors Service offers two ways to get the support you need: Online Advice - an interactive service, accessible through the Savings Plan Web Tool. Professional Management - a program that allows you to delegate management of your account to a professional advisor (additional fees apply). For more information, including the fees that apply should you enroll in the Professional Management program, access the Savings Plan Web Tool > Voya Retirement Advisors or call the Savings Plan Information Line. Fee and Expense Information for Investment Options in the Plans The insert to this Guide titled Fee and Expense Information (Appendix C) provides the approximate expected range of annual investment management fees, annual administrative expenses and total annual expenses as a percentage of fund assets for the Core Funds and Target Date Funds. The insert also gives the approximate expected range of administrative fees for the Self-Directed Brokerage Account ( SDBA ) and the Fee Schedule for SDBA brokerage transactions. The Fee and Expense Information inserts for all plans will be updated annually during the first quarter of each year and will be available on the Savings Plan Web Tool or by calling the Savings Plan Information Line. 4. Voya Retirement Advisors Service Participants who have an account balance in any of the Plans may use the Voya Retirement Advisors Service to obtain objective, professional financial advice and planning to help you set and meet your retirement goals. The Voya Retirement Advisors Service will make investment option recommendations, help forecast your retirement income, and provide you with the ability to monitor your account. September fSPIOG

42 Lockheed Martin Corporation Savings Plans Investment Options Guide Target Date Funds Overview The Target Date Funds are custom-designed funds made available only to Lockheed Martin savings plan participants. Each Target Date Fund is a fully diversified portfolio managed by an experienced portfolio management team. Target Date Fund 2005* Target Date Fund 2010* Target Date Fund 2015* Target Date Fund 2020 Target Date Fund 2025 Target Date Fund 2030 Target Date Fund 2035 Target Date Fund 2040 Target Date Fund 2045 Target Date Fund 2050 Target Date Fund 2055 Target Date Fund 2060 How to Select the Target Date Fund That is Right for You 1. Estimate the date you think you might retire or the date you expect to begin withdrawals from your account. 2. Pick the Target Date Fund corresponding to the year closest to your estimated retirement date or the date you expect to begin withdrawals from your account. Target Date Funds Birth Date Ranges** Fund Name Birth Date Range Target Date Fund 2005* December 31, 1942 or before Target Date Fund 2010* January 1, 1943 December 31, 1947 Target Date Fund 2015* January 1, 1948 December 31, 1952 Target Date Fund 2020 January 1, 1953 December 31, 1957 Target Date Fund 2025 January 1, 1958 December 31, 1962 Target Date Fund 2030 January 1, 1963 December 31, 1967 Target Date Fund 2035 January 1, 1968 December 31, 1972 Target Date Fund 2040 January 1, 1973 December 31, 1977 Target Date Fund 2045 January 1, 1978 December 31, 1982 Target Date Fund 2050 January 1, 1983 December 31, 1987 Target Date Fund 2055 January 1, 1988 December 31, 1992 Target Date Fund 2060 January 1, 1993 or after *Intended for those near or in retirement **Birth Date Ranges are determined based on retirement at age 65. March gSPIOG

43 Lockheed Martin Corporation Savings Plans Investment Options Guide Professionals Manage Your Savings The Target Date Funds are managed by a team of portfolio managers appointed by LMIMCo. LMIMCo may add or replace one or more portfolios or portfolio managers at any time without notice to participants. Target Date Glide Path Over time, the asset mix of each Target Date Fund will be adjusted across a diversified group of assets that is considered to be appropriate for someone retiring in or near its designated year. Every three months the asset mix of each fund makes a gradual adjustment to a more conservative mix of investments. This process is shown on the chart below and is referred to as the Glide Path. The portfolio managers invest in an expanded list of asset classes that include three general categories: stocks, bonds and diversifiers. Using a Target Date Fund allows you to have exposure to certain asset classes not otherwise available in the savings plans. For example, the Target Date Funds include allocations to emerging market bonds and a balanced risk allocation strategy. These are asset classes not available as separate investment options. All of the Target Date Funds include a mix of actively and passively managed investments. The Glide Path provider and manager is AllianceBernstein L.P. March gSPIOG

44 Lockheed Martin Corporation Savings Plans Investment Options Guide A Simple and Effective Way to Invest The Target Date Funds with dates furthest in the future have the most aggressive asset mix. They start out invested primarily in stocks. As the target retirement date for a fund gets closer, and for 15 years after the target retirement date, the fund is gradually adjusted to a more conservative asset mix, meaning fewer stocks and more bonds. So by the time you move into retirement, your fund will be more focused on protecting your money and producing income. This adjustment happens automatically you don t have to do a thing. A Target Date Fund s asset allocation is based on assumptions regarding expected future asset class returns, expected retirement date, savings rate, life expectancy and post-retirement income needs. If your circumstances are significantly different from those assumed for the Target Date Fund nearest your expected retirement date, a different Target Date Fund or a Mix & Monitor strategy may be more appropriate for you. Diversification That Changes With Your Needs You ve heard about the importance of diversification and the need to avoid putting all your eggs in one basket. Choosing one of the Target Date Funds allows you to diversify your savings account among a number of different investment funds, focused on a number of different asset classes and managed by different teams of investment management specialists. This means you ll be less likely to miss out on opportunities in any particular investment category. Multiple Investments in a Single Strategy Each of the 12 Target Date Funds begins with a particular asset class mix. Here s an example of the diversified asset class mix (also known as the asset allocation) for someone who is age 55. March gSPIOG

45 Lockheed Martin Corporation Savings Plans Investment Options Guide The chart below shows the asset allocation, which follows the Glide Path to adjust over time based on your age. Benchmarks The benchmarks for the Target Date Funds are customized blends of representative indices for each asset class. The benchmark returns are calculated by weighting the monthly index returns of each asset class by each Target Date Fund s target allocation. The following benchmarks are currently used to represent the Target Date Funds asset classes when calculating the blended benchmark. March gSPIOG

46 Lockheed Martin Corporation Savings Plans Investment Options Guide Target Date Funds Investment Option Fact Sheet Objective Target Date Funds offer participants a simple, one-step approach to fund selection. Each Target Date Fund is designed to provide an age-appropriate asset allocation in order to produce sufficient returns to meet retirement goals for the average participant. There are no guarantees that the Target Date Funds investment objectives will be met. Composition and Strategy The Target Date Funds invest in a number of underlying investment portfolios created specifically for use by the Target Date Funds. Each of these portfolios may be further sub-divided to allow several different firms to manage the portfolio. Every three months the asset mix of each Target Date Fund is rebalanced to gradually adjust to a more conservative asset mix. This process is referred to as a Glide Path. Quarterly rebalancing is used to move each Target Date Fund down the Glide Path toward a slightly more conservative asset mix to avoid significant asset mix changes at one time. The Target Date Funds also may generate some income by loaning securities to creditworthy financial institutions. Factors Affecting Performance The Target Date Funds investments in common stocks which include U.S. and foreign equities, are subject to considerable investment and stock market risk, including the possibility that stock prices will decline over short or even extended periods. Foreign stocks can be volatile due to changing trade patterns and economic policies, political and social instability, and currency exchange rate fluctuations. Small- to mid-sized company stocks carry additional risk due to volatile cash flow and earnings. The Target Date Funds fixed income/bond investments, which include U.S. core bonds, inflation-protected bonds, stable value investments, high yield bonds, and emerging market bonds, are sensitive to interest rate changes. When rates rise, bond values tend to decline and when rates fall, bond values tend to rise. The Target Date Funds diversifier investments are intended to provide diversification and returns uncorrelated to stocks and bonds. These diversifier investments, which may include but are not limited to global real estate, commodities and the balanced risk investments, carry additional risk, some of it tied to cyclical price trends, inflation or deflation, and global demand and supply forces. Performance Performance information, including how Target Date Funds have performed over time, along with a comparative benchmark, can be found in Appendices A and B of this Guide. Performance information is updated periodically on the Savings Plan Web Tool. (continued) March hSPIOG

47 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Target Date Funds (continued) Investment Managers Lockheed Martin Investment Management Company (LMIMCo), a wholly owned subsidiary of Lockheed Martin Corporation, located at 6901 Rockledge Drive, Bethesda, MD 20817, directs the overall asset allocation of the Target Date Funds and manages a small portion of the Target Date Funds. LMIMCo has appointed external portfolio managers and the Glide Path provider for the Target Date Funds. The investment portfolios underlying the Target Date Funds are currently managed by a number of investment managers that may include, but are not limited to: AllianceBernstein L.P. Axiom International Investors, LLC BlackRock Financial Management, Inc. CBRE Clarion Securities LLC Cohen & Steers Capital Management, Inc. Columbia Investment Advisors, LLC Henderson Global Investors Hexavest Inc. Invesco Institutional (N.A.) Inc. J.P. Morgan Investment Management, Inc. Kleinwort Benson Investors International, Ltd. LMIMCo Mar Vista Investment Partners, LLC Morgan Stanley Investment Management Limited Neuberger Berman Management LLC Northern Trust Investments, Inc. Oaktree Capital Management L.P. State Street Global Advisors T. Rowe Price Associates, Inc. TCW Investment Management Company Van Berkom and Associates, Inc. William Blair & Company, LLC LMIMCo appoints the investment managers and may add or replace one or more of the managers at any time without notice to the participants. Fair Value Pricing Managers of the portfolios underlying the Target Date Funds, in determining the net asset value (NAV) of its portfolio, may use fair value pricing when reliable market quotations are not readily available or if the value of a security it holds has been materially affected by events occurring before the fund s pricing time but after the close of the primary markets or exchanges on which the security is traded, as may happen with foreign securities. When fair value pricing is employed, the prices of securities used by a manager to calculate its fund s NAV may differ from quoted or published prices. Fund Structure The Target Date Funds were created for the Company savings plans using a mix of commingled trust funds, separate accounts and mutual funds. The Glide Path provider and manager is AllianceBernstein L.P.

48 Lockheed Martin Corporation Savings Plans Investment Options Guide Core Funds Core funds have a particular investment goal and strategy. The Core Fund lineup includes a variety of individual funds that cover a broad range of asset classes. If you are comfortable deciding how to divide your money among stocks, bonds, diversifiers and short-term investments, you can design your own portfolio mix using the Core Funds. For more information about any of the mutual funds available as Core Fund options, including fees and expenses, call the Savings Plan Information Line at for free Fund prospectuses. Read them carefully before making your investment choices. Fair Value Pricing Managers of the Core Funds, in determining the net asset value (NAV) of its fund, may use fair value pricing when reliable market quotations are not readily available or if the value of a security it holds has been materially affected by events occurring before the fund s pricing time, but after the close of the primary markets or exchanges on which the security is traded, as may happen with foreign securities. When fair value pricing is employed, the prices of securities used by a manager to calculate its fund s NAV may differ from quoted or published prices. Investment Option Government Short Term Investment Fund Stable Value Fund Treasury Inflation-Protected Securities (TIPS) Fund Broad Market Bond Index Fund S&P 500 Indexed Equity Fund U.S. Equity Fund Small / Mid-Cap Indexed Equity Fund Global Equity Fund International Developed Markets Equity Fund MSCI EAFE Indexed Equity Fund Global Real Estate Fund Emerging Markets Indexed Equity Fund High Yield Bond Fund Commodities Fund Company Common Stock Fund ESOP Fund* Fund Type Domestic Short Term Fixed Income Stable Value Domestic Inflation-Protected Fixed Income Index Domestic Fixed Income Index Domestic Stock Index Domestic All Cap Stock Domestic Small/Mid-Cap Stock Index Global Stock Foreign Stock Foreign Stock Index Global Real Estate Securities Foreign Emerging Stock Index High Yield Fixed Income Commodities Non-Diversified Domestic Stock Non-Diversified Domestic Stock S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. MSCI EAFE is a registered trademark of MSCI Inc. *Available in the SSP, HSP and BBP only. To read more detailed descriptions of all the Core Funds, refer to the Investment Option Fact Sheets that follow. September iSPIOG

49 Lockheed Martin Corporation Savings Plans Investment Options Guide Core Funds Mix & Monitor Mix & Monitor You may create your own investment mix by choosing any combination of the savings plan s Core investment options. (These Core investment options are not the same as the portfolios used in connection with the Target Date Funds.) After you create your mix, you can monitor your investments and make adjustments as your goals change over time. You can also rebalance on a regular basis to bring your asset mix back to the appropriate asset allocation after any particular funds have outperformed or under-performed for a period of time. Here s the process: > Match Your Mix to Your Circumstances A basic investment mix is a percentage of three main asset classes: stocks, bonds and diversifiers. Your mix should primarily depend on your assessment of your own need for capital appreciation versus preservation of savings. > Diversify to Manage Risk Depending on your assessment, you may choose to allocate more or less to certain sub-asset classes to provide diversification. > Select Your Funds Choose the funds that you believe will best meet your intended objective target asset mix. > Monitor and Modify Your Investment Mix As your investment returns rise and fall over time, you can rebalance to get back to your desired stock, bond, and diversifier mix. You may also want to consider adjusting your mix as you approach retirement. September jSPIOG

50 Lockheed Martin Corporation Savings Plans Investment Options Guide Government Short Term Investment Fund Investment Option Fact Sheet Objective The Government Short Term Investment Fund seeks to provide safety of principal, a high level of liquidity, and a competitive yield while maintaining a stable share price. There is no guarantee that the Fund s objectives will be met. structure, this Fund will tend to perform better in a rising interest rate environment. This Fund may experience inflation risk, which is the chance that the Fund s return will not exceed inflation. If the fund yield is below the expense ratio, total net returns could be negative. Composition and Strategy The Fund attempts to achieve its investment objective by investing, under normal circumstances, substantially all of its assets in obligations issued or guaranteed as to principal and interest by the U.S. government or its agencies or instrumentalities ( U.S. government securities ), in repurchase agreements collateralized by U.S. government securities, and in money market mutual funds subject to SEC Rule 2a-7 and other investment pools that are deemed to be consistent with the Fund s investment objective. All of the Fund s investments will be denominated in U.S. dollars. Investments made by the Fund may satisfy some, but not necessarily all, of the quality, maturity and diversification requirements set forth in Rule 2a-7 under the U.S. Investment Company Act of For example, the dollar-weighted average maturity and dollar-weighted average life of the Fund will not normally exceed 60 days and 120 days, respectively, and the maximum expected average time to receipt of principal of any single security will not normally exceed 397 days. The Fund will not invest in a security or other investment unless it is determined at the time of investment that it presents minimal credit risk. Factors Affecting Performance This Fund is designed to provide a rate of return that generally moves with short term market rates. Due to its high quality, liquidity and short maturity Performance Performance information, including how the Government Short Term Investment Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Special Transfer Restrictions Applicable to the Stable Value Fund Amounts transferred out of the Stable Value Fund must remain invested in a Core or Target Date Fund for at least 90 days before they can be transferred into the Treasury Inflation-Protected Securities (TIPS) Fund, the Government Short Term Investment Fund or the Self-Directed Brokerage Account. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a commingled trust fund offered only to participants in the Company savings plans, not to the general public. September kSPIOG

51 Lockheed Martin Corporation Savings Plans Investment Options Guide Stable Value Fund Investment Option Fact Sheet Objective The Stable Value Fund seeks to provide safety of principal, stable income and liquidity. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund invests primarily in investment contracts and money market instruments. Investment contracts are issued by insurance companies and banks, and hold fixed income securities of various maturities and various levels of credit quality. The investment contracts are designed to provide for participant withdrawals and transfers at book value according to the terms of the plan and the contracts. The book value is equal to participant net contributions plus credited interest. Under certain adverse market environments and subject to satisfaction of contract provisions, the contract issuer may be required to make payments to the Fund if the Fund s assets are insufficient to satisfy participant-initiated redemptions at book value. Investment contracts are longer-term investment vehicles with correspondingly higher expected rates of return and risk than short-term securities. While most securities held under investment contracts will be of high credit quality, a small portion may be allocated to lower quality (i.e., below investment grade) securities. The Fund also may invest in money market instruments, which are shorter-term securities with maturities of 397 days or less. The composition of investments in the Stable Value Fund can range up to 100% investment contracts or 100% money market instruments, based on market conditions. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance This Fund is designed to provide a rate of return that is stable and predictable and that generally moves toward current market rates. This Fund may experience inflation risk, which is the chance that the Fund s return will not exceed inflation. The designation Stable Value is not meant to suggest that this investment option will not experience any fluctuations in net asset value. Performance Performance information, including how the Stable Value Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Special Transfer Restrictions Applicable to the Stable Value Fund Amounts that are transferred out of the Stable Value Fund must remain invested in a Core or Target Date Fund for at least 90 days before they can be transferred into the Treasury Inflation- Protected Securities (TIPS) Fund, the Government Short Term Investment Fund or the Self-Directed Brokerage Account. Investment Manager Lockheed Martin Investment Management Company (LMIMCo) directs the overall asset allocation of the Fund. It has retained external managers to manage portions of the Fund, including: Invesco Institutional (N.A.), Inc. State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. September LSPIOG

52 Lockheed Martin Corporation Savings Plans Investment Options Guide Treasury Inflation-Protected Securities (TIPS) Fund Investment Option Fact Sheet Objective The Treasury Inflation-Protected Securities ( TIPS ) Fund seeks to provide a real return above inflation (as measured by the Consumer Price Index) by closely replicating the total return of the Barclay s U.S. Government Inflation-Linked Bond Index. That index is comprised of all U.S. TIPS with greater than one year until maturity and at least $500 million outstanding. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund seeks to closely match the characteristics of the Barclay s U.S. Government Inflation-Linked Bond Index by investing in the same securities as the Index. In addition, the Fund may invest in other inflation-linked securities not included in the Index, inflation indexed swaps, money market instruments, and short-term investment funds to facilitate transactions. Under normal circumstances, the majority of the Fund s net assets will be invested in TIPS of various maturities weighted to reflect the composition of the Index. The average maturity of both the Fund and the Index has ranged from 6.6 to 14.6 years. Duration has ranged from 5.8 to 10.6 years. As the composition of the Index changes based upon issuance by the U.S. Treasury and the maturity of the securities, the characteristics of the Fund will change to reflect it. It is not the intention of the Fund to earn returns in excess of the Index. Performance Performance information, including how the TIPS Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Special Transfer Restrictions Applicable to the Stable Value Fund Amounts that are transferred out of the Stable Value Fund must remain invested in a Core or Target Date Fund for at least 90 days before they can be transferred into the TIPS Fund, the Government Short Term Investment Fund or the Self-Directed Brokerage Account. Investment Managers The Fund is managed by: BlackRock Financial Management, Inc. State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a separate account under the Plan s trust that is available only to participants in the Company savings plans, not to the general public. Factors Affecting Performance TIPS pay a fixed interest payment upon a principal amount which varies with underlying inflation, as measured by the Consumer Price Index ( CPI ). The Fund s investments are sensitive to changes in the CPI as well as to changes in real interest rates. When real rates rise, bond values decline and when real rates fall, values rise. September mSPIOG

53 Lockheed Martin Corporation Savings Plans Investment Options Guide Broad Market Bond Index Fund Investment Option Fact Sheet Objective The Broad Market Bond Index Fund seeks to provide a high level of income by closely approximating the overall performance of the U.S. bond market as measured by the Barclays U.S. Aggregate Bond Index. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund employs sophisticated indexing methods to construct a portfolio that closely matches the characteristics of the Barclays U.S. Aggregate Bond Index (which is comprised of several thousand fixed income securities) without having to own all of the securities in the Index. The Fund invests in U.S. Treasury Securities as well as Government Agency, Investment Grade, Corporate, Residential, Commercial and Asset Backed Sectors with an attempt to minimize turnover. Derivatives are used in the form of U.S. Treasury futures contracts. The average maturity of the Fund is typically in excess of 6 years and duration is typically over 4 years. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance The Fund s fixed income investments are sensitive to interest rate changes. When rates rise, bond values tend to decline and when rates fall, values tend to rise. Performance Performance information, including how the Broad Market Bond Index Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Manager The Fund is managed by: Northern Trust Investments, Inc. LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a commingled trust fund offered only to qualified employee benefit plan investors. September nSPIOG

54 Lockheed Martin Corporation Savings Plans Investment Options Guide S&P 500 Indexed Equity Fund Investment Option Fact Sheet Objective The S&P 500 Indexed Equity Fund is designed to produce results that closely approximate the overall performance of large U.S. company stocks, as measured by the Standard & Poor s 500 Index, which is comprised of 500 common stocks that are determined by Standard & Poor s to be representative of the overall U.S. equity market. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund seeks to replicate the total return of the Standard & Poor's 500 Index. When it is not possible or practicable to buy and/or hold the stocks in proportion to their weighting in the Index, the Fund may employ a sampling or optimization technique to construct the portfolio. The Fund uses a passive investment approach. To meet liquidity needs, however, the Fund may hold a small portion of its assets in money market securities and in index futures contracts. This approach results in returns that closely parallel those of the Index. The manager's strategy is to buy and hold securities, trading only when there is a change to the S&P 500 Index. Factors Affecting Performance As a fund investing primarily in common stocks, the Fund is subject to investment and stock market risk, including the possibility that common stock prices will decline over short or even extended periods. Performance Performance information, including how the S&P 500 Indexed Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a commingled trust fund offered only to qualified employee benefit plan investors. S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc The Fund may also generate some income by lending securities to creditworthy financial institutions. September oSPIOG

55 Lockheed Martin Corporation Savings Plans Investment Options Guide U.S. Equity Fund Investment Option Fact Sheet Objective The U.S. Equity Fund has been designed to outperform the Russell 3000 Index. The Russell 3000 Index measures the performance of 3,000 of the largest U.S. companies. This index includes large-, mid-, and small-cap growth and value stocks. There is no guarantee that the Fund's objective will be met. Composition and Strategy The Fund invests primarily in the broad U.S. stock market including large, mid-, and small-cap growth and value stocks regularly traded in public markets. To meet liquidity needs, the Fund may hold a small portion of its assets in cash or cash equivalents. The Fund may also generate some income by loaning securities to creditworthy financial institutions. Factors Affecting Performance Because the Fund invests primarily in common stocks, it is subject to stock market and investment risk. The Fund could lose money over short or long time periods. The Fund s value and total return could fluctuate within a wide range. Performance Performance information for the Fund, including how the U.S. Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo) directs the overall asset allocation of the Fund. It has retained several managers to manage portions of the Fund, including, but not limited to: Alliance Bernstein, LP Artisan Partners Limited Partnership Columbia Management Investment Advisers, LLC Eagle Capital Management, LLC JP Morgan Investment Management, Inc. Northern Trust Investments, N.A. Palisade Capital Management, LLC Sands Capital Management State Street Global Advisors Van Berkom and Associates, Inc. Vulcan Value Partners Wellington Management Company, LLP Wells Capital Management, Inc. William Blair & Company, LLC LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. Russell is a registered trademark of Russell Investments. September pSPIOG

56 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Small / Mid-Cap Indexed Equity Fund Objective The Small / Mid-Cap Indexed Equity Fund seeks to match the total return performance of the Russell Small Cap Completeness Index. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund consists of those securities in the Russell Small Cap Completeness Index. This Index is comprised of all stocks in the Russell 3000 Index minus those in the S&P 500 Index, and is a benchmark for the small- to mid-cap sector of the U.S. equity market. The Fund invests in all 2,500 stocks in the Russell Small Cap Completeness Index. The Fund is managed using a passive or indexing investment approach, by which the manager attempts to match, before expenses, the performance of the Index. The manager will typically attempt to invest in the equity securities comprising the Index, in approximately the same proportions as they are represented in the Index. Equity securities may include common stocks, preferred stocks, depository receipts, or other securities convertible into common stock. The Fund may purchase securities in their initial public offerings ( IPOs ). In some cases, it may not be possible or practicable to purchase all of the securities comprising the Index, or to hold them in the same weightings as they represent in the Index. In those circumstances, the manager may employ a sampling or optimization technique to construct the portfolio in question. From time to time securities are added to or removed from the Index. The manager may sell securities that are represented in the Index, or purchase securities that are not yet represented in the Index, prior to or after their removal or addition to the Index. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance Since the Fund invests a large majority of assets in common stocks, it is subject to considerable investment and stock market risk, including the possibility that stock prices will decline over short or even extended periods. Small- to mid-sized company stocks have more unpredictable growth patterns and carry additional risks due to volatile cash flows and earnings. Performance Performance information, including how the Small / Mid-Cap Indexed Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a commingled trust fund offered only to qualified employee benefit plan investors. Russell is a registered trademark of Russell Investments. S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. September qSPIOG

57 Lockheed Martin Corporation Savings Plans Investment Options Guide Global Equity Fund Investment Option Fact Sheet Objective The Global Equity Fund has been designed to outperform the MSCI All Country World (ACWI) Investable Market Index (IMI) Net. This Index includes both large- and small-cap companies as well as value and growth styles of equity markets all over the world. The MSCI ACWI IMI Net includes exposure to developed as well as emerging markets. The principal objective of the Fund is long-term growth of capital; potential dividend income is a secondary objective. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund invests primarily in U.S. and foreign stocks including large-, mid-, and small-cap stocks regularly traded in public markets. To meet liquidity needs, the Fund may hold a small portion of its assets in cash or cash equivalents. The Fund may also generate some income by lending securities to creditworthy financial institutions. Performance Performance information, including how the Global Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo) directs the overall asset allocation of the Fund. It has retained several managers to manage portions of the Fund, including, but not limited to: Artisan Partners Limited Partnership Capital Research and Management Company Kleinwort Benson Investors International, Ltd Northern Trust Investments, N.A. Wellington Management Company LLP LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. Factors Affecting Performance The Fund may be affected by risks associated with investing globally, including, but not limited to, economic policies, currency exchange rate fluctuations, exchange rate control policies, and economic, political and social instability. Because the Fund invests primarily in common stocks, it is subject to stock market and investment risk. The Fund could lose money over short or long time periods. The Fund s value and total return could fluctuate within a wide range. September rSPIOG

58 Lockheed Martin Corporation Savings Plans Investment Options Guide International Developed Markets Equity Fund Investment Option Fact Sheet Objective The International Developed Markets Equity Fund has been designed to outperform the MSCI World ex USA Investable Market Index (IMI) Net over the long term as additional managers may be added over time. This Index includes large- and small-cap value and growth stocks of non-usa countries defined by MSCI Barra as developed international equity markets. The principal objective of the Fund is long-term growth of capital; potential dividend income is a secondary objective. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund invests primarily in foreign stocks including small-, mid-, and large-cap stocks regularly traded in public markets. To meet liquidity needs, the Fund may hold a small portion of its assets in cash or cash equivalents. The Fund may also generate some income by lending securities to creditworthy financial institutions. Performance Performance information, including how the International Developed Markets Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo) directs the overall asset allocation of the Fund, and has retained the following manager to manage the Fund: Northern Trust Investments, N.A. LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. Factors Affecting Performance The Fund may be affected by risks associated with investing internationally, including, but not limited to, economic policies, currency exchange rate fluctuations, exchange rate control policies, and economic, political and social instability. Because the Fund invests primarily in common stocks, it is subject to stock market and investment risk. The Fund could lose money over short or long time periods. The Fund s value and total return could fluctuate within a wide range. September sSPIOG

59 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet MSCI EAFE Indexed Equity Fund Objective The MSCI EAFE Indexed Equity Fund is an index fund designed to produce results that closely approximate the overall performance of the MSCI Inc. (MSCI) Europe, Australasia, Far East (EAFE) Index. The MSCI EAFE Index is an equity index which captures large- and mid-cap representation across Developed Markets countries* around the world, excluding the US and Canada. The Index covers approximately 85% of the free float-adjusted market capitalization in each country. * Developed Markets countries in the MSCI EAFE Index include Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund owns all stocks in the MSCI EAFE Index in the same proportion as the Index. To meet liquidity needs, however, the Fund may hold a small portion of its assets in money market securities and index futures contracts. This approach results in returns and Fund characteristics that closely parallel those of the Index. The manager s strategy is to buy and hold securities, trading only when there is a change to the MSCI EAFE Index. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance The Fund may be affected by risks associated with investing internationally, including, but not limited to, economic policies, currency exchange rate fluctuations, exchange rate control policies, and economic, political and social instability. Because the Fund invests primarily in common stocks, it is subject to stock market and investment risk. The Fund could lose money over short or long time periods. The Fund s value and total return could fluctuate within a wide range. Performance Performance information, including how the MSCI EAFE Indexed Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a commingled trust fund offered only to qualified employee benefit plan investors. MSCI EAFE is a registered trademark of MSCI Inc. September tSPIOG

60 Lockheed Martin Corporation Savings Plans Investment Options Guide Global Real Estate Fund Investment Option Fact Sheet Objective The Global Real Estate Fund is designed to produce results that generally follow the direction of the FTSE EPRA/NAREIT Developed Real Estate Index Net Total Return to U.S. Investors, which is designed to reflect the stock performance of companies engaged in specific aspects of the major real estate markets/regions of the developed world. Performance of this index is listed in U.S. dollars and assumes reinvestment of dividends. There is no guarantee that the Fund s objectives will be met. Composition and Strategy The Fund is an actively-managed fund that invests primarily in equity, preferred equity and convertible debt securities of companies located throughout the world that are mainly in the real estate industry, including real estate investment trusts (REITs), real estate operating companies (REOCs), limited partnerships and similar entities established in or outside the United States. These real estate companies generally are engaged directly in real estate management or development activities or invest directly in real estate and/or mortgages. Such companies may concentrate in a particular region or property type. The Fund was created for the Company savings plans using multiple managers and may include a mix of commingled trust funds, mutual funds and separate accounts. To meet liquidity needs, the Fund may hold a portion of its assets in money market securities, commingled short term investment funds and index futures contracts. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance The Fund may be affected by risks associated with investing globally, including, but not limited to, economic policies, currency exchange rate fluctuations, exchange rate control policies, and economic, political and social instability. The Fund is also subject to investment and market risk, including the possibility that security prices will decline over short or even extended periods. Investing in real estate companies entails the risks of the real estate business generally, including the risks of owning real estate directly, risks that relate specifically to the way in which real estate companies are organized and operated, sensitivity to economic and business cycles, changing demographic patterns and government actions. The real estate sector may underperform relative to other sectors or the overall market. This Fund may use derivatives, including futures, options, forward contracts, swaps and structured investments, to modify exposure to a market or to currency exchange rates or interest rates and other hedging and non-hedging purposes. Derivative instruments may involve a high degree of financial risk. These risks include: the risk that a small movement in the price of the underlying security or benchmark may result in a disproportionately large movement, unfavorable or favorable, in the price of the derivative instrument; risk of default by a counterparty; and the risk that a transaction may not be liquid. The Fund is non-diversified under the Investment Company Act of 1940 and may invest a large percentage of its assets in fewer issuers than diversified mutual funds. Because of the smaller number of securities generally held in the Fund s portfolio, the Fund may be subject to greater risks than a more diversified fund. A change in the value (continued) September uSPIOG

61 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Global Real Estate Fund (continued) of any single holding may affect the overall value of the portfolio more than it would affect a diversified fund that holds more investments. Performance Performance information, including how the Global Real Estate Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo), directs the overall asset allocation of the Fund. It has retained several managers to manage portions of the Fund, including: CBRE Clarion Securities LLC Morgan Stanley Investment Management State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a separate account under the Plan s trust that is available only to participants in the Company savings plans, not to the general public.

62 Lockheed Martin Corporation Savings Plans Investment Options Guide Emerging Markets Indexed Equity Fund Investment Option Fact Sheet Objective The Emerging Markets Indexed Equity Fund is an index fund designed to produce results that closely approximate the overall performance of the MSCI Emerging Markets Index. The MSCI Emerging Markets Index captures large- and mid-cap representation across Emerging Markets (EM) countries*. The Index covers approximately 85% of the free floatadjusted market capitalization in each country. * EM countries include: Brazil, Chile, China, Columbia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Russia, South Africa, South Korea, Taiwan, Thailand, Turkey and United Arab Emirates. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund owns substantially all of the stocks in the MSCI Emerging Markets Index in the same proportion as the Index. The MSCI Emerging Markets Index is made up of common stocks of companies located in emerging markets around the world. The manager s strategy is to buy and hold securities, trading only as necessary to track the MSCI Emerging Markets Index. To meet liquidity needs, however, the Fund may hold a small portion of its assets in money market securities and in index futures contracts. This approach results in returns and Fund characteristics that closely parallel those of the Index. Factors Affecting Performance The Fund may be affected by risks associated with foreign markets, including, but not limited to, economic condition changes, financial market liquidity, social and political instability and fluctuation in currency and exchange rates. This Fund may use derivatives such as futures and forwards to maintain equity and currency exposure for its cash position. As a fund investing primarily in common stocks, the Fund is subject to investment and stock market risk, including the possibility that common stock prices will decline over short or even extended periods. Performance Performance information, including how the Emerging Markets Indexed Equity Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Manager The Fund is managed by: Northern Trust Investments, Inc. LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a commingled trust fund offered only to qualified employee benefit plan investors. MSCI Emerging Markets Index is a registered trademark of Morgan Stanley Capital International. September vSPIOG

63 Lockheed Martin Corporation Savings Plans Investment Options Guide High Yield Bond Fund Investment Option Fact Sheet Objective The High Yield Bond Fund seeks to achieve an attractive total return (income plus capital preservation) over time by investing primarily in U.S. dollar-denominated fixed income securities that are rated below investment grade (often referred to as junk bonds ) issued by U.S. and foreign corporations, governments and agencies. The Fund also invests in interests in bank loans. The Fund s return is benchmarked against the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index. There is no guarantee that the Fund s objective will be met. Composition and Strategy Under normal market conditions, the Fund will invest primarily in high yield debt instruments. These high yield debt instruments include corporate debt securities as well as bank loans rated below investment grade by a nationally recognized statistical rating organization, or if unrated, determined to be of comparable quality. The fund may also invest in credit-linked notes and certain derivatives. The weighted average maturity of the Fund will typically be between three and ten years. Credit risk will be managed through disciplined credit analysis and diversification of credit quality. The Fund may invest in securities whose ratings imply an imminent risk of default with respect to repayment of principal and payment of interest. The Fund may also generate some income by lending securities to creditworthy financial institutions. Factors Affecting Performance The Fund s performance is primarily dependent on the performance of the high-yield bond and loan market. The market s behavior is unpredictable, particularly in the short term. Some of the factors that can significantly affect the performance of the Fund include market conditions, interest rate risk and credit risk. The Fund could lose money over short or long time periods. The Fund s value and total return could fluctuate within a wide range. Performance Performance information, including how the High Yield Bond Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo), directs the overall asset allocation of the Fund. It has retained several managers to manage portions of the Fund, including, but not limited to: Columbia Management Investment Advisers, LLC Neuberger Berman Management LLC LMIMCo appoints the investment managers and may add or replace one or more managers at any time without notice to the participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. September v1SPIOG

64 Lockheed Martin Corporation Savings Plans Investment Options Guide Commodities Fund Investment Option Fact Sheet Objective The Commodities Fund is designed to track or exceed the returns of the Bloomberg Commodity Index Total Return (Bloomberg Index) over the long term. The Fund will attempt to achieve this objective by investing in instruments, including derivatives and equity securities that provide exposure to the commodities markets. Commodities have exhibited return patterns that are uncorrelated to stocks and bonds, which could make them a good diversifier for your portfolio. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund invests primarily in commodity-linked investments that provide exposure to the performance of the commodities markets, and other fixed-income and debt instruments. The Fund may invest in equities and derivative instruments, including options, futures, swaps, structured securities and other derivative investments. The Fund may also invest in foreign securities. Cash balances and money used as collateral for derivative exposures will be invested primarily in short-term investment grade fixed income securities. While the Fund may not purchase noninvestment grade fixed-income securities, the Fund may continue to hold fixed income securities that become non-investment grade at the discretion of the investment manager(s). The Fund s performance is measured against the Bloomberg Commodity Index Total Return. Factors Affecting Performance The prices of commodity-linked derivatives may move in different directions than investments in traditional equity and debt securities. Exposure to the commodities markets may subject the Fund to greater volatility than investments in traditional securities. Commodity derivative instruments may involve a high degree of financial risk. These risks include: Leverage risk -- the risk that a small movement in the price of the underlying security or benchmark September 2015 may result in a disproportionately large movement, unfavorable or favorable, in the price of the derivative instrument. Counterparty risk -- the risk that a default by another party can result in a failure to collect assets or returns earned by the Fund. Volatility risk -- the risk that the high rate of change in the prices of commodities will prevent the Fund from buying or selling the instruments at profitable prices. Liquidity risk -- the risk that certain factors may prevent the purchase or sale of the derivatives or securities, leaving the Fund with an undesired position for some period of time and may compound the effects of volatility risk and leverage risk. Reinvestment risk -- the risk that changes in interest rates may cause commodity derivative prices to fall. Regulatory risk -- the risk that US-based and global regulators may restrict, limit, or otherwise change the way commodity derivatives may be traded by market participants. Storage cost risk -- the risk of a fundamental change in the cost of producing, transporting, holding, or preserving the value of a commodity. Hedger/Speculator risk -- Hedgers and speculators are the two market participants that generally transact in commodity derivative markets. Hedgers generally attempt to ensure that the cost at which they produce or sell a good is fixed, whereas speculators make bets that a price will move in a certain direction. Hedger/Speculator risk results when market forces create incentives for hedgers and speculators to cause large price fluctuations. The Fund utilizes an active management approach. The percentage of the Fund s assets (continued) 200wSPIOG

65 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Commodities Fund (continued) linked to a particular commodity market will vary from time to time based on the investment manager s assessment of the appreciation possibilities of the commodities as well as changes in the commodity s underlying weight in the Bloomberg index. The Fund may also invest in foreign securities, which may be more volatile than investments in U.S. securities and may be subject to fluctuation and sudden economic and political developments. The Fund may also hold non-investment grade fixedincome securities, which are considered speculative. Non-investment grade fixed-income securities and unrated securities of comparable credit quality are subject to the increased risk of an issuer s inability to meet principal and interest payment obligations. The Fund is non-diversified under the Investment Company Act of 1940 and may invest a large percentage of its assets in fewer issuers than diversified mutual funds. Because of the smaller number of securities generally held in the Fund s portfolio, the Fund may be subject to greater risks than a more diversified fund. A change in the value of any single holding may affect the overall value of the portfolio more than it would affect a diversified fund that holds more investments. Fund will invest cash collateral using primarily investment grade fixed income securities. As a fund investing in common stocks, the Fund is subject to investment and stock market risk, including the possibility that common stock prices will decline over short or even extended periods. Performance Performance information, including how the Commodities Fund has performed over time along with a comparative benchmark, can be found in Appendices A and B of this Guide. Investment Managers Lockheed Martin Investment Management Company (LMIMCo) directs the overall asset allocation of the Fund and may manage all or portions of the Fund. In addition, LMIMCo may retain external managers to manage portions of the Fund, and may add or replace one or more managers at any time without notice to participants. Fund Structure The Fund is a separate account under the Plans trust that is available only to participants in the Company savings plans, not to the general public. Fund returns may be affected by risks associated with foreign markets, including, but not limited to, economic condition changes, financial market liquidity, social and political instability and currency and exchange rates. Although this Fund will primarily use derivatives such as futures and forwards to maintain its commodity exposure, the Fund may also use equity and currency securities. The Fund may invest in commodity futures, which may be more volatile than equities related to commodity operations or the underlying prices of physical commodities. In times when the forward prices of commodities exceed the current prices, a commodity futures portfolio may lose value even during periods where underlying physical commodity prices are unchanged or rising. The

66 Lockheed Martin Corporation Savings Plans Investment Options Guide Company Common Stock Fund Investment Option Fact Sheet Objective The Company Common Stock Fund invests primarily in shares of Lockheed Martin Corporation common stock and seeks growth over the long term through dividends and appreciation in the stock's value. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund is invested primarily in Lockheed Martin common stock. However, a small portion of the Fund's assets is held in cash equivalent reserves to allow for the daily processing of fund transfers (reallocations and spot transfers) and withdrawals. Cash equivalent reserves typically range between.25% and 1% of the Fund, but may be as high as 10%. Because the Fund also invests in cash equivalent reserves, the Fund's performance may vary from that of Lockheed Martin common stock. Factors Affecting Performance The Fund is neither a mutual fund nor a diversified or managed investment option. Because this Fund is not diversified, the value of the Fund may experience large fluctuations based on Lockheed Martin Corporation s financial performance, stock market volatility and general economic conditions. Performance Performance information, including how the Company Common Stock Fund has performed over time, can be found in Appendices A and B of this Guide. Dividends You control how your quarterly dividends, paid on the shares attributable to your investment in the Fund, are managed. You can decide to reinvest the dividends in the Fund, which will keep the dividends in the Plan free from taxes until you remove them or you can decide to have them distributed directly to you as taxable income on a semi-annual basis. The SPD for your savings plan has complete details on the treatment of dividends for the Company Common Stock Fund. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more of the managers at any time without notice to the participants. Fund Structure This Fund was created for the Company savings plans under the Plans trust and is only available to participants in those plans, not to the general public. The Importance of Diversifying Your Retirement Savings To help achieve long-term retirement security, you should give careful consideration to the benefits of a well-balanced and diversified investment portfolio. Spreading your assets among different types of investments can help you achieve a favorable rate of return while minimizing your overall risk of losing money. This is because market or other economic conditions that cause one category of assets, or one individual security, to perform well often cause another asset category, or another particular security, to perform poorly. If you invest more than 20% of your retirement savings in any one company or industry, your savings may not be properly diversified. Although diversification is not a guarantee against loss, it is an effective strategy to help you manage investment risk. Note: Federal securities laws prohibit a participant from directing investments into or out of the Company Common Stock Fund if the participant is in possession of material nonpublic information. Certain officers subject to Section16 of the Securities and Exchange Act of 1934 are also restricted in their ability to direct transactions into or out of the Company Common Stock Fund. September xSPIOG

67 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet ESOP Fund Available only in the SSP, HSP and BBP Objective The ESOP Fund invests primarily in shares of Lockheed Martin Corporation common stock and seeks growth over the long term through dividends and appreciation in the stock's value. There is no guarantee that the Fund s objective will be met. Composition and Strategy The Fund is invested primarily in Lockheed Martin common stock. However, a small portion of the Fund's assets is held in cash equivalent reserves to allow for the daily processing of fund transfers (reallocations and spot transfers) and withdrawals. Cash equivalent reserves typically range between.25% and 1% of the Fund, but may be as high as 10%. Because the Fund also invests in cash equivalent reserves, the Fund's performance may vary somewhat from that of Lockheed Martin common stock. Factors Affecting Performance The Fund is neither a mutual fund nor a diversified or managed investment option. Because this Fund is not diversified, the value of the Fund may experience large fluctuations based on Lockheed Martin Corporation s financial performance, stock market volatility and general economic conditions. Performance Performance information, including how the ESOP Fund has performed over time, can be found in Appendices A and B of this Guide. Dividends You control how your quarterly dividends, paid on the shares attributable to your investment in the Fund, are managed. You can decide to reinvest the dividends in the Fund, which will keep the dividends in the Plan free from taxes until you remove them or you can decide to have them distributed directly to you as taxable income on a semi-annual basis. The SPD for your savings plan has complete details on the treatment of dividends for the ESOP Fund. Investment Manager The Fund is managed by: State Street Global Advisors LMIMCo appoints the investment managers and may add or replace one or more of the managers at any time without notice to the participants. Fund Structure This Fund was created for the Company savings plans under the Plans trust and is only available to participants in those plans, not to the general public. The Importance of Diversifying Your Retirement Savings To help achieve long-term retirement security, you should give careful consideration to the benefits of a well-balanced and diversified investment portfolio. Spreading your assets among different types of investments can help you achieve a favorable rate of return, while minimizing your overall risk of losing money. This is because market or other economic conditions that cause one category of assets, or one individual security, to perform well often cause another asset category, or another particular security, to perform poorly. If you invest more than 20% of your retirement savings in any one company or industry, your savings may not be properly diversified. Although diversification is not a guarantee against loss, it is an effective strategy to help you manage investment risk. Note: Federal securities laws prohibit a participant from directing investments into or out of the Company Common Stock Fund if the participant is in possession of material nonpublic information. Certain officers subject to Section16 of the Securities and Exchange Act of 1934 are also restricted in their ability to direct transactions into or out of the ESOP Fund. September ySPIOG

68 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Self-Directed Brokerage Account Overview The Self-Directed Brokerage Account (SDBA) is a brokerage option that affords more flexibility in choosing retirement savings investments by allowing you to invest in most: stocks listed on the New York Stock Exchange, American Stock Exchange or NASDAQ, exchange-traded funds (ETFs), corporate and government bonds, and mutual funds, including approximately 2,100 No-Transaction-Fee (NTF) 1 mutual funds (subject to Plan restrictions). Brokerage services for SDBAs in the Company savings plans are provided by TD Ameritrade, Inc. (TD Ameritrade). The SDBA investment option is designed for the experienced investor who wants to independently and actively manage a portion of his or her savings plan assets and is willing to accept responsibility for researching, selecting, monitoring and managing the investments. If you are confident with the independent approach to investing and assuming the additional responsibility of actively managing and monitoring the investments in your Savings Plan account, the SDBA may be right for you. Voya Retirement Advisors Service The Voya Retirement Advisors Service will not advise you about the suitability of any security or investment strategy outside the Savings Plan s Core Fund or Target Date Fund investment options, nor can it provide financial, legal or tax advice on these securities or investment strategies. 1 No-Transaction-Fee (NTF) mutual funds are no-load mutual funds for which TD Ameritrade does not charge a transaction fee. NTFs, as well as other funds, have other continuing fees and expenses described in the fund s prospectus.td Ameritrade receives remuneration from fund companies for record-keeping, shareholder and other administrative services. The amount of remuneration is based in part on the amount of investments in such funds by TD Ameritrade clients. Almost all funds held 90 days or less will be subject to a short-term redemption fee of $ This fee is in addition to any applicable transaction fees or fees described in the fund's prospectus. Eligibility and Limitations To participate in the SDBA, you must: Have a combined balance of at least $4,000 in your Core Funds and Target Date Funds and make an initial transfer of at least $3,000 from your Core Funds or Target Date Funds. Pay all trading fees, commissions, administrative fees, and any other expenses associated with participating in the SDBA. You may make subsequent minimum transfers of $1,000 from your Core Funds or Target Date Funds, subject to a maximum of 75% of your total plan balance. You may only transfer non-roth amounts to your non-roth SDBA and Roth amounts to your Roth SDBA for Savings Plans that have the Roth feature. If you have an account in more than one Savings Plan and wish to open an SDBA in more than one Savings Plan, the above limitations apply to each Savings Plan separately. Opening an SDBA To open an SDBA, please follow the steps below: 1. Complete a TD Ameritrade SDBA application. The application may be downloaded from the Savings Plan Web Tool or you may call the Savings Plan Information Line at to request an SDBA application be mailed to you. To access the Savings Plan Web Tool, visit LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan. Or, go to On your Savings Plan s page, navigate to Plan Information> Forms and Documents > Self-Directed Brokerage Account Application. September abSPIOG

69 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet 2. Indicate the type of account(s) you wish to open. You may select the check box to indicate you are applying to open a Roth SDBA or the check box to indicate you are applying to open both types of accounts (Roth and non-roth). If neither box is checked, then the account is opened as a non-roth account. 3. Return the completed application to TD Ameritrade by fax or by mail to the address provided on the application. 4. Once the application is received and approved, TD Ameritrade will open your account(s) within two business days and send you information that includes a welcome letter, your SDBA account number(s) and a description of TD Ameritrade resources to help you place trades and obtain information about your account(s). Additionally, you will receive a Personal Identification Number for each account under separate cover. After you use your account number and PIN to activate your account, you will be asked to create a User ID and password which you will use to access your account in the future. You ll then be able to transfer money into your SDBA(s). Funding Your SDBA To invest in your SDBA, you must transfer money from your Core Funds or Target Date Funds. Transfers may be initiated by accessing the Savings Plan Web Tool or by calling the Savings Plan Information Line at To access the Savings Plan Web Tool, visit LM People at via the Intranet ( via the Internet) > Pay and Benefits > Savings Plan. Or, go to On your Savings Plan s page, navigate to Account > Manage Investments > Fund Transfer. Note the following transfer restrictions: After your initial transfer of at least $3,000, subsequent transfers must be at least $1,000 and must not exceed 75% of your total plan balance. Stable Value Fund must assets must be transferred to the Core Funds or Target Date Funds for at least 90 days before they can be transferred into the Treasury Inflation-Protected Securities (TIPS) Fund, the Government Short Term Investment Fund or the SDBA. Furthermore, Savings Plan contributions withheld from your paycheck cannot go directly into the SDBA(s). Roth 401(k) contributions, Roth rollovers, and in-plan Roth conversions may only be transferred to a Roth SDBA. Only Savings Plan assets can be transferred into your SDBA. You may not contribute any outside assets. Money Transferred to and from Your SDBA Money transferred from your Core Funds or Target Date Funds to your SDBA is invested in the TD Asset Management TDAM Money Market Portfolio Select Class (MMF) until you direct a trade. Note that Fund transfers completed before 4 p.m. Eastern time will be processed the same business day, and the funds will generally be available in the MMF the following business day. Fund transfers completed at or after 4 p.m. Eastern time will be processed the next business day, and the funds will generally be available in the MMF the second business day thereafter. When transferring money back to your Plan s Core Funds or Target Date Funds, SDBA assets must be sold, if necessary, before funds can be transferred to your designated investment options. The MMF is managed by TD Asset Management USA Inc., an affiliate of TD Ameritrade. A fund prospectus will be mailed once an SDBA is established.

70 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet Dividend Reinvestment Certain securities pay dividends to shareholders on a quarterly, annual, or one-time basis. Dividends paid on securities in your SDBA accounts will be deposited in cash to your SDBA account unless you enroll in the Dividend Reinvestment Program, a service provided by TD Ameritrade at no additional cost to you. Under this program, your dividends will be automatically reinvested in a number of common stocks, preferred stocks, and mutual funds. You can choose from more than 5,000 eligible securities for dividend reinvestment. You can also choose to reinvest dividends for all eligible securities or specify specific eligible securities. Please contact TD Ameritrade Participant Services at for more information on this program. SDBA Impact on Loans, Withdrawals and Distributions (as permitted by your Plan) Loans and withdrawals cannot be made directly from assets in your SDBA(s). Balances held in your SDBA(s) may limit the amounts available for loans and withdrawals. In order to have these assets included in amounts available for loans and withdrawals, you must first sell assets in your SDBA(s) and transfer money into your Core Funds or Target Date Funds to be included in available amounts for loans and withdrawals. See Transferring Money from Your SDBA(s) into Your Core Funds or Target Date Funds below for instructions. Distributions cannot be processed if you have assets in your SDBA(s). Prior to requesting an account distribution, you must first sell all of the assets in your SDBA(s) and transfer all of the proceeds into your Core Funds or Target Date Funds. Following this transfer, your account balance will be made available for distribution subject to the terms of your Savings Plan. Transferring Money from Your SDBA(s) into Your Core Funds or Target Date Funds To transfer money from your SDBA(s) into your Core Funds or Target Date Funds, please follow the steps below: 1. If necessary, direct the sale of securities in your SDBA(s) and wait until the trade settles (generally two to three business days) so the proceeds from the sale are available in the MMF in your SDBA(s). To access your SDBA, see Accessing Your SDBA and Placing Trade Orders below. 2. Contact an ING Representative directly via the Savings Plan Information Line or access the Savings Plan Web Tool to initiate a transfer from the MMF in your SDBA to the Core Funds or Target Date Funds. 3. Transfers will be reflected in your Core Fund or Target Date Fund balances at the beginning of the next business day. Note that Fund transfers completed before 4 p.m. Eastern time will be processed the same business day, and the proceeds will generally be available in your account the following business day. Fund transfers completed at or after 4 p.m. Eastern time will be processed the next business day, and the proceeds will generally be available in your account on the second business day thereafter. Accessing Your SDBA and Placing Trade Orders After you have opened and transferred money to your SDBA, you can access your account and place trade orders by: logging on to the TD Ameritrade trading website. Shortly after establishing your SDBA(s), you will receive a separate communication containing the website address and details about the site as well as an account number and Personal Identification Number to be used exclusively for online trading in your SDBA(s). In addition to trading, you can also review your SDBA information and access valuable market information. Look for this information in the mail once you have opened your SDBA(s).

71 Lockheed Martin Corporation Savings Plans Investment Options Guide Investment Option Fact Sheet calling the TD Ameritrade Interactive Voice Response (IVR) phone system at , 24 hours a day, 7 days a week. The system will lead you through the quote and order process and prompt you to enter information using your telephone keypad and voice commands. Use your account number and PIN described above to access this system. If you do not have your PIN handy, a representative will ask certain security questions in order to confirm your identity prior to allowing trades via the IVR. calling TD Ameritrade licensed brokers at between the hours of 8:00 a.m. and 7:00 p.m., Monday through Friday, Eastern time, excluding New York Stock Exchange holidays. An experienced licensed broker will assist you with trades, quotes and market data. TD Ameritrade brokers do not provide investment recommendations or advice. Note: some fees are higher if you execute trades using IVR or a broker as opposed to the online website. Please refer to Appendix C for information on fees. SDBA Trade Confirmations and Statements Each time you place a trade, TD Ameritrade provides you with an official trade confirmation via your choice of or mail. Additionally, you will receive a brokerage statement for any month in which there is trading activity. You will also receive fund prospectuses and semiannual and annual reports for the investments in your SDBA(s). The market value of your SDBA(s) will be reflected on your Savings Plan statement. Your account balances, when viewed on the Savings Plan Web Tool, will include the SDBAs among your selected investment options. SDBA Fee and Expense Information Each security you purchase or sell in your SDBA(s) is a separate transaction. You will be charged commissions and fees as indicated on Appendix C: Fee and Expense Information Self-Directed Brokerage Account (SDBA). In addition, your total savings plan balance is subject to administrative expenses as disclosed in Appendix C (Fee and Expense Information). Refer to Appendix C specific to each savings plan in which you are a participant. These expenses are charged daily to each of your investment options on a pro-rata basis; however, the administrative expenses attributable to your SDBA(s) will be charged monthly to your Core Fund and Target Date Fund balances on a pro-rata basis as a reduction in applicable units owned. A portion of the revenue generated from the SDBA option may, through revenue sharing payments, be used to reduce administrative expenses proportionally among all Savings Plans. TD Ameritrade and TD Asset Management USA are affiliated through their respective parent companies. Brokerage services provided by TD Ameritrade, Inc., member FINRA/SIPC. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. An investment in the TD Asset Management TDAM Money Market Portfolio Select Class is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. Carefully consider the fund s investment objectives, risks, charges and expenses before investing. To obtain a prospectus or summary prospectus which contains this and other important information, call TD Ameritrade at Read carefully before investing.

72 Lockheed Martin Corporation Savings Plans Investment Options Guide Appendix A Average Annual Rates of Return as of December 31, 2016 The percentages shown in the table below represent the appreciation or depreciation for each investment option during the periods indicated. Returns included for the Core Funds and Target Date Funds are net of certain management and administrative expenses and do not necessarily reflect the appreciation or depreciation of an individual participant's account. The growth of each participant's account may vary due to participant transactions such as contributions, fund transfers, withdrawals, etc. Comparative benchmark indices are included for reference only and do not impact participant account balances. The benchmark indices do not include any expenses. Past performance does not guarantee how the investment option will perform in the future. Current performance may be lower or higher than the performance data quoted. Average Annual Rates of Return 1 Core Funds 1 Year 3 Years 5 Years 10 Years Since Inception Inception Date Government Short Term Investment Fund 0.30% 0.11% 0.08% N/A 0.07% 5/3/2010 Bank of America Merrill Lynch 3 mth U.S. T-Bill Index 0.33% 0.14% 0.12% N/A 0.12% Stable Value Fund 1.66% 1.44% 1.34% 2.13% 3.33% 4/1/1995 imoneynet MF Avg/All Taxable Index 0.13% 0.05% 0.04% 0.71% 2.29% Treasury Inflation-Protected Securities (TIPS) Fund 5.05% 2.49% 0.88% N/A 3.16% 5/3/2010 Bloomberg Barclays U.S. Government Inflation-Linked Bond Index 5.10% 2.56% 0.98% N/A 3.28% Broad Market Bond Index Fund 2.50% 2.99% 2.14% 4.24% 4.65% 4/1/2001 Bloomberg Barclays U.S. Aggregate Bond Index 2.65% 3.03% 2.23% 4.34% 4.70% S&P 500 Indexed Equity Fund 11.94% 8.83% 14.62% 6.93% 9.15% 4/1/1995 S&P 500 Index 11.96% 8.87% 14.66% 6.95% 9.19% U.S. Equity Fund 9.71% 6.91% N/A N/A 7.59% 12/2/2013 Russell 3000 Value Index 12.74% 8.43% N/A N/A 9.11% Small / Mid-Cap Indexed Equity Fund 16.52% 6.49% 14.55% 7.79% 8.99% 4/1/2001 Russell Small Cap Completeness Index 16.59% 6.55% 14.61% 7.80% 8.86% Global Equity Fund 3.64% 3.98% N/A N/A 4.57% 12/2/2013 MSCI All Country World (ACWI) Investable Market Index (IMI) Net 8.36% 3.25% N/A N/A 3.74% International Developed Markets Equity Fund 3.21% -1.03% N/A N/A -0.34% 12/2/2013 MSCI World ex USA Investable Market Index (IMI) Net 2.95% -1.20% N/A N/A -0.45% MSCI EAFE Indexed Equity Fund 1.86% -1.40% 6.75% 0.91% 5.01% 1/1/2004 MSCI EAFE Index 1.00% -1.60% 6.53% 0.75% 4.88% Global Real Estate Fund 2.23% 4.88% 8.86% N/A 6.88% 5/3/2010 FTSE EPRA/NAREIT Dev Net TRI USD 4.06% 5.90% 9.48% N/A 7.85% Emerging Markets Indexed Equity Fund 10.91% -2.79% 1.08% N/A -0.17% 5/3/2010 MSCI Emerging Markets Index 11.19% -2.55% 1.28% N/A 0.12% High Yield Bond Fund 13.24% 3.68% N/A N/A 3.71% 12/2/2013 BofA Merrill Lynch U.S. High Yield Master II Constrained Index 17.49% 4.73% N/A N/A 4.79% Commodities Fund 11.35% % -9.53% N/A -6.40% 5/3/2010 Bloomberg Commodity Index Total Return 11.77% % -8.95% N/A -6.17% Company Common Stock Fund % 22.33% 29.62% 13.93% 13.01% 4/1/1995 ESOP Fund Salaried (SSP Only) % 22.36% 29.66% 13.94% 11.26% 1/1/1997 ESOP Fund Hourly (BBP and HSP Only) % 22.32% 29.56% 13.92% 15.13% 10/1/1999

73 Lockheed Martin Corporation Savings Plans Investment Options Guide Average Annual Rates of Return (continued) Average Annual Rates of Return 1 Target Date Funds 5 10 Since Inception 1 Year 3 Years Years Years Inception Date Target Date Fund % 2.60% 4.55% N/A 3.06% 6/2/2008 Target Date 2005 Blended Index % 2.40% 4.27% N/A 2.75% Target Date Fund % 2.61% 4.81% N/A 3.04% 6/2/2008 Target Date 2010 Blended Index % 2.49% 4.61% N/A 2.80% Target Date Fund % 2.62% 5.26% N/A 2.94% 6/2/2008 Target Date 2015 Blended Index % 2.57% 5.14% N/A 2.79% Target Date Fund % 2.67% 5.89% N/A 2.86% 6/2/2008 Target Date 2020 Blended Index % 2.70% 5.85% N/A 2.81% Target Date Fund % 2.69% 6.56% N/A 2.67% 6/2/2008 Target Date 2025 Blended Index % 2.79% 6.61% N/A 2.73% Target Date Fund % 2.63% 7.26% N/A 2.56% 6/2/2008 Target Date 2030 Blended Index % 2.81% 7.41% N/A 2.75% Target Date Fund % 2.61% 7.80% N/A 2.59% 6/2/2008 Target Date 2035 Blended Index % 2.85% 8.02% N/A 2.85% Target Date Fund % 2.47% 7.93% N/A 2.66% 6/2/2008 Target Date 2040 Blended Index % 2.69% 8.13% N/A 2.90% Target Date Fund % 2.45% 7.95% N/A 2.69% 6/2/2008 Target Date 2045 Blended Index % 2.67% 8.15% N/A 2.92% Target Date Fund % 2.45% 7.97% N/A 2.70% 6/2/2008 Target Date 2050 Blended Index % 2.67% 8.16% N/A 2.93% Target Date Fund % 2.46% 7.97% N/A 6.19% 1/4/2010 Target Date 2055 Blended Index % 2.67% 8.17% N/A 6.41% Target Date Fund % N/A N/A N/A 3.08% 1/2/2015 Target Date 2060 Blended Index % N/A N/A N/A 2.79% Notes: 1 Returns have been reduced by the Fund s total expenses. The returns are annualized rates of return ending December 31, The performance is shown for the stated time period only; due to market volatility, each account s performance may be different. The returns shown assume the reinvestment of income and/or the reinvestment of dividends and other income. 2 Returns for the Company Common Stock Fund and the ESOP Fund include the effects of dividends and changes in price. 3 The benchmarks for the Target Date Funds are customized blends of representative indices for each asset class. The benchmark returns are calculated by weighting the monthly index returns of each asset class by each Fund's target allocation. Target allocations rebalance quarterly in accordance with each Fund's Glide Path. The following benchmarks are currently used to represent the Target Date Funds asset classes when calculating the blended benchmark: Asset Classes in the Target Date Funds Benchmarks U.S. Large Cap Stocks Russell 1000 Index U.S. Small / Mid-Cap Stocks Russell 2000 Index Non-U.S. Stocks MSCI EAFE Index Emerging Markets Stocks MSCI Emerging Markets Index Commodities Bloomberg Commodity Index Total Return Direct Global Real Estate/REIT Securities FTSE EPRA/NAREIT Developed Real Estate Index Balanced Risk Allocation CPI (Consumer Price Index) + 3% High Yield Bonds BofA Merrill Lynch U.S. High Yield Master II Constrained Index Emerging Markets Bonds JPMorgan EMBI Global Diversified Index U.S. Core Bonds Bloomberg Barclays U.S. Aggregate Bond Index Inflation-Protected Bonds Bloomberg Barclays U.S. Government Inflation-Linked Bond Index Stable Value Fund imoneynet MF Avg/All Taxable S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. Russell is a registered trademark of Russell Investments.

74 Lockheed Martin Corporation Savings Plans Investment Options Guide Appendix B Annual Rates of Return as of December 31, 2016 The percentages shown in the table below represent the appreciation or depreciation for each investment option during the periods indicated. Returns included for the Core Funds and Target Date Funds are net of certain management and administrative expenses and do not necessarily reflect the appreciation or depreciation of an individual participant's account. The growth of each participant's account may vary due to participant transactions such as contributions, fund transfers, withdrawals, etc. Comparative benchmark indices are included for reference only and do not impact participant account balances. The benchmark indices do not include any expenses. Past performance does not guarantee how the investment option will perform in the future. Current performance may be lower or higher than the performance data quoted. Annual Rates of Return 1 Inception Core Funds Date Government Short Term Investment Fund 0.30% 0.04% 0.00% 0.03% 0.03% 0.01% 5/3/2010 Bank of America Merrill Lynch 3 mth U.S. T-Bill Index 0.33% 0.05% 0.03% 0.07% 0.11% 0.10% Stable Value Fund 1.66% 1.50% 1.18% 1.10% 1.28% 1.90% 4/1/1995 imoneynet MF Avg/All Taxable Index 0.13% 0.02% 0.01% 0.02% 0.03% 0.02% Treasury Inflation-Protected Securities (TIPS) Fund 5.05% -1.74% 4.31% -9.40% 7.08% 13.81% 5/3/2010 Bloomberg Barclays U.S. Government Inflation-Linked Bond Index 5.10% -1.72% 4.43% -9.26% 7.26% 13.98% Broad Market Bond Index Fund 2.50% 0.53% 6.02% -2.32% 4.16% 7.91% 4/1/2001 Bloomberg Barclays U.S. Aggregate Bond Index 2.65% 0.55% 5.97% -2.02% 4.21% 7.84% S&P 500 Indexed Equity Fund 11.94% 1.34% 13.63% 32.37% 15.96% 2.05% 4/1/1995 S&P 500 Index 11.96% 1.38% 13.69% 32.39% 16.00% 2.11% U.S. Equity Fund % 0.00% 11.36% 2.57% N/A N/A 12/2/2013 Russell 3000 Value Index % 0.48% 12.56% 2.64% N/A N/A Small / Mid-Cap Indexed Equity Fund 16.52% -3.49% 7.40% 38.38% 18.01% -3.85% 4/1/2001 Russell Small Cap Completeness Index 16.59% -3.41% 7.40% 38.50% 18.05% -3.92% Global Equity Fund % 4.77% 3.52% 2.10% N/A N/A 12/2/2013 MSCI All Country World (ACWI) Investable Market Index (IMI) Net % -2.19% 3.84% 1.77% N/A N/A International Developed Markets Equity Fund % -1.81% -4.34% 2.06% N/A N/A 12/2/2013 MSCI World ex USA Investable Market Index (IMI) Net % -1.95% -4.45% 2.26% N/A N/A MSCI EAFE Indexed Equity Fund 1.86% -0.51% -5.40% 21.91% 18.59% % 1/1/2004 MSCI EAFE Index 1.00% -0.81% -4.90% 22.78% 17.32% % Global Real Estate Fund 2.23% -1.15% 14.16% 3.77% 27.69% -7.44% 5/3/2010 FTSE EPRA/NAREIT Dev Net TRI USD 4.06% -0.79% 15.02% 3.67% 27.73% -6.46% Emerging Markets Indexed Equity Fund 10.91% % -2.46% -2.71% 18.03% % 5/3/2010 MSCI Emerging Markets Index 11.19% % -2.19% -2.60% 18.22% % High Yield Bond Fund % -3.62% 2.13% 0.37% N/A N/A 12/2/2013 BofA Merrill Lynch U.S. High Yield Master II Constrained Index % -4.61% 2.51% 0.53% N/A N/A Commodities Fund 11.35% % % -8.64% -3.78% % 5/3/2010 Bloomberg Commodity Index Total Return 11.77% % % -9.52% -1.06% % Company Common Stock Fund % 16.03% 33.49% 67.52% 19.30% 20.43% 4/1/1995 ESOP Fund Salaried (SSP Only) % 16.08% 33.53% 67.65% 19.31% 20.43% 1/1/1997 ESOP Fund Hourly (BBP and HSP Only) % 16.03% 33.46% 67.29% 19.24% 20.37% 10/1/1999

75 Lockheed Martin Corporation Savings Plans Investment Options Guide Annual Rates of Return (continued) Annual Rates of Return 1 Inception Target Date Funds Date Target Date Fund % -1.29% 3.96% 4.80% 10.35% 1.14% 6/2/2008 Target Date 2005 Blended Index % -0.94% 3.45% 4.66% 9.65% 0.95% Target Date Fund % -1.76% 3.82% 5.74% 10.73% 0.88% 6/2/2008 Target Date 2010 Blended Index % -1.17% 3.30% 5.71% 10.07% 0.71% Target Date Fund % -2.17% 3.72% 7.26% 11.48% -0.15% 6/2/2008 Target Date 2015 Blended Index % -1.40% 3.21% 7.33% 10.90% -0.27% Target Date Fund % -2.46% 3.65% 9.30% 12.52% -1.45% 6/2/2008 Target Date 2020 Blended Index % -1.50% 3.16% 9.47% 12.06% -1.54% Target Date Fund % -2.78% 3.57% 11.60% 13.65% -3.19% 6/2/2008 Target Date 2025 Blended Index % -1.65% 3.10% 11.86% 13.34% -3.27% Target Date Fund % -3.19% 3.31% 14.29% 14.90% -5.00% 6/2/2008 Target Date 2030 Blended Index % -1.90% 2.87% 14.65% 14.77% -5.05% Target Date Fund % -3.58% 3.23% 16.44% 15.73% -6.51% 6/2/2008 Target Date 2035 Blended Index % -2.09% 2.77% 16.88% 15.70% -6.54% Target Date Fund % -3.76% 3.02% 17.27% 16.06% -6.93% 6/2/2008 Target Date 2040 Blended Index % -2.26% 2.49% 17.69% 16.01% -6.94% Target Date Fund % -3.79% 3.02% 17.35% 16.18% -6.91% 6/2/2008 Target Date 2045 Blended Index % -2.27% 2.49% 17.77% 16.10% -6.93% Target Date Fund % -3.79% 3.02% 17.38% 16.24% -6.95% 6/2/2008 Target Date 2050 Blended Index % -2.27% 2.49% 17.81% 16.15% -6.97% Target Date Fund % -3.79% 3.02% 17.35% 16.27% -6.97% 1/4/2010 Target Date 2055 Blended Index % -2.27% 2.49% 17.80% 16.18% -6.99% Target Date Fund % -3.39% N/A N/A N/A N/A 1/2/2015 Target Date 2060 Blended Index 4,5 8.07% -1.72% N/A N/A N/A N/A Notes: 1 Returns have been reduced by the Fund s total expenses. The returns shown assume the reinvestment of income and/or the reinvestment of dividends and other income. 2 The 2013 returns for the High Yield Bond Fund, U.S. Equity Fund, Global Equity Fund and International Developed Markets Equity Fund (Inception Date 12/01/2013) and the respective benchmarks cover the period 12/1/ /31/ Returns for the Company Common Stock Fund include the effects of dividends and changes in price. 4 The benchmarks for the Target Date Funds are customized blends of representative indices for each asset class. The benchmark returns are calculated by weighting the monthly index returns of each asset class by each Fund's target allocation. Target allocations rebalance quarterly in accordance with each Fund's Glide Path. The following benchmarks are currently used to represent the Target Date Funds asset classes when calculating the blended benchmark: Asset Classes in the Target Date Funds Benchmarks U.S. Large Cap Stocks Russell 1000 Index U.S. Small / Mid-Cap Stocks Russell 2000 Index Non-U.S. Stocks MSCI EAFE Index Emerging Markets Stocks MSCI Emerging Markets Index Commodities Bloomberg Commodity Total Return Index Direct Global Real Estate/REIT Securities FTSE EPRA/NAREIT Developed Real Estate Index Balanced Risk Allocation CPI (Consumer Price Index) + 3% High Yield Bonds BofA Merrill Lynch U.S. High Yield Master II Constrained Index Emerging Markets Bonds JPMorgan EMBI Global Diversified Index U.S. Core Bonds Bloomberg Barclays U.S. Aggregate Bond Index Inflation-Protected Bonds Bloomberg Barclays U.S. Government Inflation-Linked Bond Index Stable Value Fund imoneynet MF Avg/All Taxable S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. Russell is a registered trademark of Russell Investments. 5 The 2015 return for Target Date Fund 2060 (Inception Date 1/2/2015) and the respective benchmark covers the period 1/2/ /31/2015.

76 Lockheed Martin Corporation Savings Plans Investment Options Guide Appendix C - SSP Lockheed Martin Corporation Salaried Savings Plan Fee and Expense Information Core Funds and Target Date Funds as of March 1, 2017 Fund returns are reduced by investment management fees and administrative expenses. The following table presents the approximate expected range of annual investment management fees, annual administrative expenses and total annual expenses as a percentage of fund assets for the Core Funds and Target Date Funds in the savings plan. Annual Inv. Mgmt. Fees Annual Admin Expenses Total Annual Expenses Range From Approximately Range From Approximately Expected To Average Range From Approximately Expected To Average Government Short Term Investment Fund 0.02% to 0.03% 0.03% to 0.08% 0.05% 0.05% to 0.11% 0.07% to 0.08% Stable Value Fund 0.15% to 0.35% 0.03% to 0.08% 0.05% 0.18% to 0.43% 0.20% to 0.40% Treasury Inflation-Protected Securities (TIPS) Fund 0.02% to 0.02% 0.03% to 0.08% 0.05% 0.05% to 0.10% 0.07% to 0.07% Broad Market Bond Index Fund 0.03% to 0.03% 0.03% to 0.08% 0.05% 0.06% to 0.11% 0.08% to 0.08% S&P 500 Indexed Equity Fund 0.02% to 0.02% 0.03% to 0.08% 0.05% 0.05% to 0.10% 0.07% to 0.07% U.S. Equity Fund 0.10% to 0.90% 0.03% to 0.08% 0.05% 0.13% to 0.98% 0.15% to 0.95% Small / Mid-Cap Indexed Equity Fund 0.04% to 0.04% 0.03% to 0.08% 0.05% 0.07% to 0.12% 0.09% to 0.09% Global Equity Fund 0.20% to 1.05% 0.03% to 0.08% 0.05% 0.23% to 1.13% 0.25% to 1.10% International Developed Markets Equity Fund 0.20% to 1.05% 0.03% to 0.08% 0.05% 0.23% to 1.13% 0.25% to 1.10% MSCI EAFE Indexed Equity Fund 0.08% to 0.08% 0.03% to 0.08% 0.05% 0.11% to 0.16% 0.13% to 0.13% Global Real Estate Fund 0.50% to 1.05% 0.03% to 0.08% 0.05% 0.53% to 1.13% 0.55% to 1.10% Emerging Markets Indexed Equity Fund 0.14% to 0.14% 0.03% to 0.08% 0.05% 0.17% to 0.22% 0.19% to 0.19% High Yield Bond Fund 0.25% to 0.70% 0.03% to 0.08% 0.05% 0.28% to 0.78% 0.30% to 0.75% Commodities Fund 0.01% to 0.15% 0.03% to 0.08% 0.05% 0.04% to 0.23% 0.06% to 0.20% Company Common Stock Fund 0.02% to 0.02% 0.03% to 0.08% 0.05% 0.05% to 0.10% 0.07% to 0.07% ESOP Fund 0.02% to 0.02% 0.03% to 0.08% 0.05% 0.05% to 0.10% 0.07% to 0.07% Target Date Fund % to 0.51% 0.03% to 0.08% 0.05% 0.19% to 0.59% 0.21% to 0.56% Target Date Fund % to 0.55% 0.03% to 0.08% 0.05% 0.19% to 0.63% 0.21% to 0.60% Target Date Fund % to 0.58% 0.03% to 0.08% 0.05% 0.19% to 0.66% 0.21% to 0.63% Target Date Fund % to 0.62% 0.03% to 0.08% 0.05% 0.19% to 0.70% 0.21% to 0.67% Target Date Fund % to 0.68% 0.03% to 0.08% 0.05% 0.19% to 0.76% 0.21% to 0.73% Target Date Fund % to 0.76% 0.03% to 0.08% 0.05% 0.20% to 0.84% 0.22% to 0.81% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.21% to 0.90% 0.23% to 0.87% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.19% to 0.90% 0.21% to 0.87% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.18% to 0.90% 0.20% to 0.87% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.18% to 0.90% 0.20% to 0.87% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.18% to 0.90% 0.20% to 0.87% Target Date Fund % to 0.82% 0.03% to 0.08% 0.05% 0.18% to 0.90% 0.20% to 0.87% March ajSPIOG

77 Lockheed Martin Corporation Savings Plans Investment Options Guide Appendix C SDBA Fees and Expenses SSP/CAP/OSSP/PSP/HSP/BBP/HCAP Fee and Expense Information - Self-Directed Brokerage Account (SDBA) As of April 3, 2017 The SDBA is a brokerage option offered in the Savings Plans that affords more flexibility in choosing your retirement savings investments by allowing you to invest in exchange-traded stocks, bonds, and mutual funds. Brokerage services for the Savings Plan s SDBA are provided by TD Ameritrade, Inc. Investments in the SDBA are subject to the same administrative expenses as all other savings plan assets, as noted in above. In addition, your participation in the SDBA will be subject to the commissions, transaction and service fees as indicated in the following schedule: Commissions and Transaction Fees Stocks and ETFs 1 Price Internet orders $4.95 Interactive Voice Response (IVR) phone system orders $14.99 Broker-assisted orders $24.99 Commission-Free ETFs 2 No Commission 1 Orders executed in multiple lots on the same trading day will be charged a single commission. When an order is partially executed over multiple trading days, the order is subject to a separate commission charge for each trading day. 2 ETFs eligible for commission-free trading must be held at least 30 days. If you sell an eligible ETF within 30 days of it being purchased commission-free, a short-term trading fee will apply. Mutual Funds Price No Load $9.95 Load No Fee 3 No-Transaction-Fee (NTF) No Fee 4 3 The Fund Family will charge fees as detailed in the fund prospectus. 4 No-Transaction-Fee (NTF) mutual funds are no-load mutual funds for which TD Ameritrade does not charge a transaction fee. NTFs, as well as other funds, have other continuing fees and expenses described in the fund s prospectus. TD Ameritrade receives remuneration from fund companies for record-keeping, shareholder and other administrative services. The amount of remuneration is based in part on the amount of investments in such funds by TD Ameritrade clients. Almost all funds held 90 days or less will be subject to a short-term redemption fee of $ This fee is in addition to any applicable transaction fees or fees described in the fund's prospectus Fixed Income Investments 5 All buy orders for bonds are subject to a five bond ($5,000 par value) minimum. Online CD buy orders are subject to a two CD ($2,000 par value) minimum. Service Fees 6 5 TD Ameritrade may act as principal on any fixed income transaction. When acting as principal, TD Ameritrade will add a markup to any purchase and subtract a markdown from every sale. This markup or markdown will be included in the price quoted to you. Reorganization Fees Deposit 7 $25 Mandatory 8 $20 Non-mandatory and tender offers 9 $30 Withdrawal from tender offer 10 $10 April akSPIOG

78 Lockheed Martin Corporation Savings Plans Investment Options Guide Fee and Expense Information - Self-Directed Brokerage Account (SDBA) As of April 3, 2017 Service Fees 6 (continued) Duplicate Statements and Confirmations $5 per copy (no charge for electronic documents) Research Fee 11 $60 per hour 6 All service fees are subject to change. TD Ameritrade reserves the right to pass through Regulatory Fees, foreign transaction taxes, and other fees to client accounts, which may be assessed under various U.S. regulations or imposed by foreign governments. Fees may include any of the following: a sales fee on certain sell transactions (assessed at a rate consistent with Section 31 of the Securities and Exchange Act of 1934) and foreign transaction taxes and fees, among other charges. 7 Applies when a security has gone through a mandatory reorganization before the certificate is deposited into an account. 8 Applies when a security has gone through a mandatory reorganization for all shares held in an account, including those pending trade settlement, on the effective date of the reorganization Applies when a participant chooses to participate in a non-mandatory reorganization offer. Applies when a participant chooses to withdraw from a non-mandatory reorganization offer. Research is conducted subsequent to specific and usually disputed account activities. A portion of the revenue generated from the SDBA option may, through revenue sharing payments, be used to reduce administrative expenses proportionally among all Savings Plans. The cumulative effect of fees and expenses can substantially reduce the growth of your retirement savings. There are many factors in addition to fees and expenses that you should consider when you decide to invest in a savings plan option. For example, you may also want to consider whether an investment in a particular option, along with your other investments, will help you achieve your financial and retirement goals. Also, note that each investment option offered has various risks, such as interest rate risk and market and credit risk. You may also want to consider your number of years before retirement and your own level of investment knowledge. There is no guarantee that a particular fund s objective will be met. April akSPIOG

79 Personal Plan Preview Savings Plan Investment Help from Voya Retirement Advisors, LLC (VRA) Choose the service that s right for you Do you feel comfortable making investment decisions? want to build your retirement plan yourself, on the Web? have other investments to consider, such as an IRA, or a prior 401(k)? want an investment strategy that covers savings, investing, and retirement income? want to speak with an Investment Advisor? want quarterly reports to keep you informed? want automatic updates to keep you on target and keep you informed? want ongoing monitoring of your account and automatic periodic adjustments? Are there fees? Online Advice No additional cost Professional Management The maximum program fee is $3.34 for every $10,000 in your account. See back for more details Get started today: To access the Savings Plan Web Tool via the Intranet, visit LMPeople at lmco.com > Pay and Benefits > Savings Plan > Voya Retirement Advisors. Via the Internet, go to or and click on Voya Retirement Advisors link on the top of the page or call a VRA Investment Advisor Representative at

80 Do it yourself Online Advice powered by Financial Engines You do the work Risk Age Savings You use our online tools to build your strategy. AVG PERFORMANCE POOR PERFORMANCE POTENTIAL LOSS Forecast $43,000 per year $26,800/yr 10.4% or more EXAMPLE ONLY You can log in anytime to see if you re on track. Emerging Markets Fund 17% Small Cap Growth 58% Intermediate Bonds 25% EXAMPLE ONLY You can get technical support by phone. You get advice on a mix of funds that can include other accounts you tell us about. You request the transactions for your account. You can sign up for Retirement Updates. Team up with an investment professional Professional Management We do the work Personal Plan Preview We send a personalized plan to you. We put your plan into action. We routinely monitor your account and rebalance as needed. We can consider assets outside your account. We have investment advisor representatives you can talk to. We keep you informed with quarterly Retirement Updates. Professional Management fees: PORTION OF ACCOUNT ANNUAL RATE MONTHLY AMOUNT * $ $50, % $3.34 per $10,000 $50, $100, % $2.50 per $10,000 $100, $150, % $1.67 per $10,000 $150, % $0.83 per $10,000 Professional Management fees are no more than 0.40 percent of your account balance per year. That s about $3.34 per month for each $10,000 in your account. Discounts apply for larger balances. TARGET DATE FUNDS As a reminder, the Lockheed Martin Savings Plan continues to offer the Lockheed Martin Target Date Funds. These funds have been designed for those who want a simple and effective option that leaves most ongoing investment decisions to investment professionals. Target Date Funds are built upon a set of assumptions which may or may not be consistent with your circumstances. In addition to assumptions about future asset class returns, the Target Date Fund that fits your expected retirement date, a different Target Date Fund or a Mix and Monitor strategy may be more appropriate for you. Advisory services are offered through Voya Retirement Advisors, LLC, a member of the Voya family of companies. Advisory services offered through Voya Retirement Advisors are powered by Financial Engines Advisory L.L.C. Advisory Services provided by Voya Retirement Advisors, LLC (VRA). For more information, please read the Voya Retirement Advisors Disclosure Statement, Advisory Services Agreement and your plan s Fact Sheet. These documents may be viewed online by accessing the advisory services link(s) through your plan s web site at You may also request these from a VRA Investment Advisor Representative by calling your plan s information line at Financial Engines Advisors L.L.C. acts as a sub-advisor for Voya Retirement Advisors, LLC. Financial Engines Advisors L.L.C. (FEA) is a federally registered investment advisor and wholly owned subsidiary of Financial Engines, Inc. Neither VRA nor FEA provides tax or legal advice. If you need tax advice, consult your accountant or if you need legal advice consult your lawyer. Neither Voya Retirement Advisors nor Financial Engines Advisors can guarantee results and past performance is no guarantee of future results. Financial Engines is a registered trademark of Financial Engines, Inc. All other marks are the exclusive property of their respective owners. * Financial Engines Advisors L.L.C., is a federally registered investment advisor and wholly-owned subsidiary of Financial Engines, Inc. Future results are not guaranteed by Financial Engines or any other party. Professional management fees are charged in the manner and frequency detailed in the Program Terms and Conditions Financial Engines, Inc. All rights reserved. Used with permission. CPY14452 VOY-LM-I-INR-ACT