SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark One)
[X] Annual Report pursuant to Section 15(d) of the Securities Exchange Act
of 1934 for the fiscal year ended December 31, 2004
OR
[ ] Transition Report pursuant to Section 15(d) of the Securities Exchange
Act of 1934 for the transition period from ______________ to
______________
Commission File Number 1-5627
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES
ITT INDUSTRIES, INC.
4 WEST RED OAK LANE, WHITE PLAINS, NY 10604
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN
FOR SALARIED EMPLOYEES
PAGE
----
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM F-1
FINANCIAL STATEMENTS:
Statement of Net Assets Available for Benefits
as of December 31, 2004 and 2003 F-2
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2004 F-3
Notes to Financial Statements F-4 - F-10
SUPPLEMENTAL SCHEDULE:
Form 5500, Schedule H, Line 4i -- Schedule of Assets (Held at End of Year)
as of December 31, 2004 F-11 - F-21
Exhibit 23 -- Consent of Independent Registered Public Accounting Firm F-22
Other schedules required by Section 2520.103-10 of the Department of Labor's
Rules and Regulations for Reporting and Disclosures under the Employee
Retirement Income Security Act of 1974 have been omitted because they are not
applicable.
These financial statements have been prepared from the Company's books and
records after making all necessary adjustments thereto, and they represent the
final statements for the period ended December 31, 2004
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Investment and Savings Plan Committee has duly caused this annual report to be
signed on its behalf by the undersigned hereunto duly authorized.
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES
BY: /s/ Geovanna Chan
----------------------------------------------------------------------------
(Geovanna Chan, Director Benefits Administration & Financial Reporting)
June 27, 2005
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Trustees and Participants of
ITT Industries Investment and Savings Plan for Salaried Employees
White Plains, New York
We have audited the accompanying statements of net assets available for
benefits of ITT Industries Investment and Savings Plan for Salaried Employees
(the "Plan") as of December 31, 2004 and 2003, and the related statement of
changes in net assets available for benefits for the year ended December 31,
2004. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Plan is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Plan's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2004 and 2003, and the changes in net assets available for benefits for the
year ended December 31, 2004 in conformity with accounting principles generally
accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents is presented for the purpose of additional analysis and is not
a required part of the basic financial statements, but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This schedule is the responsibility of the Plan's management. Such
schedule has been subjected to the auditing procedures applied in our audit of
the basic 2004 financial statements and, in our opinion, is fairly stated in all
material respects when considered in relation to the basic financial statements
taken as a whole.
/s/ Deloitte & Touche, LLP
Stamford, Connecticut
June 17, 2005
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
($ IN THOUSANDS)
December 31
--------------------------------
2004 2003
------------ ------------
Assets:
Investments $ 1,914,552 $ 1,733,725
Receivables:
Dividends 1,397 1,496
Interest 2,591 2,596
Employer Contributions 813 596
Participant Contributions 2,347 1,725
Unsettled Security Sales 597 1,390
------------ ------------
Total Receivables 7,745 7,803
Liabilities:
Accrued Financial Services Expense 168 30
Accrued Administrative Expense 398 -
Unsettled Security Purchases 6,414 403
------------ ------------
Total Liabilities 6,980 433
Net Assets Available for Benefits $ 1,915,317 $ 1,741,095
============ ============
The accompanying notes to financial statements are an integral part of the above
statements.
F-2
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
($ IN THOUSANDS)
Year Ended
December 31, 2004
-----------------
Additions:
Additions to Net Assets Attributed to:
Investment Income:
Net Appreciation in Fair Value of Investments $ 141,756
Dividends 10,994
Interest 28,083
-----------------
Total Investment Income 180,833
Contributions:
Participants 60,866
Employer 20,862
Rollovers 18,483
-----------------
Total Contributions 100,211
Asset Transfers 71
-----------------
Total Additions 281,115
-----------------
Deductions:
Deductions from Net Assets Attributed to:
Withdrawals and Distributions (100,531)
Investment Management Expenses (1,895)
Administrative Expenses (4,467)
-----------------
Total Deductions (106,893)
Increase in Net Assets 174,222
-----------------
Net Assets Available for Benefits:
Beginning of Year 1,741,095
-----------------
End of Year $ 1,915,317
=================
The accompanying notes to financial statements are an integral part of the above
statement.
F-3
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS AS OF DECEMBER 31, 2004 AND 2003, AND
FOR THE YEAR ENDED DECEMBER 31, 2004
($ IN THOUSANDS)
1. DESCRIPTION OF THE PLAN
The following description of the ITT Industries Investment and Savings Plan for
Salaried Employees (the "Plan") is provided for general information purposes
only. Participants should refer to the Plan document for more complete
information.
GENERAL -- The Plan is a defined contribution plan generally covering all
regular salaried U.S. employees of ITT Industries, Inc. (the "Company").
Employees are eligible to join the Plan on the first day of the calendar month
following completion of one month of service. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA").
CONTRIBUTIONS --
EMPLOYEE -- An eligible employee as defined in the Plan ("Member") may generally
elect to contribute 2% to 25% of base salary. A Member (other than a Member
subject to Puerto Rico's income tax) may designate his/her savings as Before-Tax
Savings, After-Tax Savings, or any combination of the two. Effective January 1,
2002 and as a result of the IRS Non-Discrimination Test results, a participant
who is considered a Highly Compensated Employee under the Plan may elect Plan
savings up to a maximum of 14% of base pay as either Before-Tax Savings,
After-Tax Savings, or any combination subject to the dollar limitation contained
in section 402(g) of the Internal Revenue Code (the "Code").
EMPLOYER -- An amount equal to 50% of a Member's first 6% of base salary saved
is matched by the Company. In addition, the Company contributes 1/2 of 1% of
base salary to the Floor Company Contribution Account, as defined by the Plan,
of each eligible Member. All Members have the ability to invest their company
contributions in any of the Plan's investment options.
All Company contributions, including the future Company contributions to the
Plan, have been deposited into the Employee Stock Ownership account (ESOP). All
dividends associated with the Company contribution held in the ITT Industries
Stock Fund in the Plan are immediately 100% vested. In addition, Members can
make an election regarding the payment of their ESOP dividends. Members can
elect to have their ESOP dividends either reinvested in the ITT Industries Stock
Fund or paid to them in cash on a quarterly basis.
F-4
The Company, or its designee, shall determine the amount of the Minimum Employer
Contribution. The Minimum Employer Contribution for each Plan Year shall be
deemed to be satisfied as of the date the aggregate amount of Before-Tax Savings
Contributions, Matching Company Contributions, and Floor Company Contributions
for each Taxable Year equals the amount of the Minimum Employer Contribution for
such Plan Year.
INVESTMENT DIRECTION -- A Member may direct employee contributions and Company
contributions, in any whole percentage, among any of twelve investment options,
and the Member can change his/her future savings and reallocate his/her
accumulated investments in 1% increments on a daily basis among the twelve
funds. The twelve funds are as follows:
ITT Industries Stock Fund
Managed Equity Index Fund
Stable Value Fund
Balanced Fund
Long Term Bond Fund
Equity Value Fund
Aggressive Growth Fund
Global Equity Fund
Small Cap Equity Fund
Asset Allocation Fund - Conservative
Asset Allocation Fund - Moderate
Asset Allocation Fund - Aggressive
MEMBER ACCOUNTS -- Each Member's account is credited with the Member's
Contributions, Company Contributions and an allocation of Plan earnings, net of
administrative expenses and investment management fees. Allocations are based on
Member account balances, as defined in the Plan document. The benefit to which a
Member is entitled is the benefit that can be provided from the Member's vested
account.
Plan accounts are valued and reconciled between the trustee and recordkeeper
daily. Members can initiate transactions by using the Plan's web site, the
automated voice response system, or by speaking to a Plan representative at the
ITT Industries Benefits Center.
A Member or Deferred Member may perform a maximum of four fund reallocations or
transfers in any calendar month. A reallocation or a transfer shall be defined
as a single reallocation or a single transfer, or as a series of reallocations
and/or transfers taking place on a single business day.
F-5
VESTING -- Members are immediately vested in their contributions and the Company
Floor Contributions plus earnings thereon. Member's interests in Matching
Company Contributions vest according to the following schedule, except as noted
previously with respect to dividends on ESOP shares which are 100% vested:
Non-forfeitable
Years of Service Percentage
---------------- ---------------
Less than 1 year................................ 0%
1 but less than 2 years......................... 20%
2 but less than 3 years......................... 40%
3 but less than 4 years......................... 60%
4 but less than 5 years......................... 80%
5 or more years................................. 100%
As of December 31, 2004 and 2003, the cumulative Matching Company Contributions
and Floor Company Contributions made on behalf of all Members, including a
pro-rata share of investment income, were as follows:
2004 2003
---------- ----------
Vested $ 763,549 $ 705,452
Non-vested 6,072 6,302
---------- ----------
$ 769,621 $ 711,754
========== ==========
FORFEITURES -- Forfeitures of the non-vested portion of any Member's Matching
Company Contributions are applied to reduce future Company Contributions.
Forfeitures for the year ended December 31, 2004 were $417.
MEMBER LOANS -- A Member may request a loan in any specified whole dollar amount
which must be at least one thousand dollars but which may not exceed the lesser
of 50% of the Vested Share, or fifty thousand dollars reduced by the Member's
highest outstanding loan balance, if any, during the prior one-year period. The
interest rate charged by the Plan is based on the prime rate plus 1%, set at the
date of the loan origination, and remains the same throughout the term of the
loan. General purpose loan terms range from one to sixty months. If the loan is
used in the purchase of a primary residence, the loan term can be for a period
of up to one hundred eighty months. Members may have two loans outstanding at
the same time. Loans to Members at December 31, 2004 and 2003 were $23,359 and
$22,267, respectively.
Effective January 6, 2003, a terminated Member may continue to make periodic
repayment on their loans after separation by contacting the Plan's Benefits
Center. However, no new loans can be requested after termination of employment.
F-6
PAYMENT OF BENEFITS -- On termination of employment (including death,
disability, or retirement), a Member or his/her surviving spouse beneficiary may
elect to receive a lump-sum amount equal to the value of the Member's vested
interest in his/her account paid in cash or as a rollover to another qualified
plan or an IRA, or periodic payments under one of two alternative installment
options. In either case, a Member or his/her surviving spouse beneficiary whose
vested account balance is more than three thousand five hundred dollars (five
thousand dollars effective January 1, 2005) may elect to keep his/her account
balance in the Plan until the year in which the Member reaches/would have
reached age 70 -1/2. Upon the death of a Member, with a non-spouse beneficiary,
the distribution must be made within five years from the Member's date of death
in the form of a lump sum payment or annual fixed period installments, provided
that the number of installments does not extend beyond five years from the date
of the Member's death.
Effective January 1, 2003, the Plan was amended to provided that all
distributions from the Plan shall comply with the requirements of Section
401(1)(9) of the Internal Revenue Code.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING -- The accompanying financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America.
USE OF ESTIMATES -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of net assets available for benefits and changes therein. Actual results
could differ from those estimates. The Plan utilizes various investment
instruments. Investment securities, in general, are exposed to various risks,
such as interest rate, credit, and overall market volatility. Due to the level
of risk associated with certain investment securities, it is reasonably possible
that changes in the values of investment securities will occur in the near term
and those changes could materially affect the amounts reported in the financial
statements.
INVESTMENT VALUATION AND INCOME RECOGNITION -- The Plan's investments are stated
at fair value except for its benefit-responsive investment contract investments
which are stated at contract value (Note 6). Quoted market prices are used to
value investments. Shares of mutual funds are valued at the net asset value of
shares held by the Plan at year-end. Purchases and sales of securities are
recorded on a trade-date basis. Interest income is recorded on the accrual
basis. Dividends are recorded on the ex-dividend date.
EXPENSES -- The Plan pays for the administrative expenses of the Plan up to
0.25% of the market value of trust assets. In 2004, these expenses amounted to
0.23% of trust assets. These expenses are limited to services provided by
unrelated vendors. The Company pays Plan administrative expenses which are not
paid by the Plan. In addition to the administrative expense charge, an
investment management fee is charged to each investment fund except for the ITT
Industries Stock Fund.
PAYMENT OF BENEFITS -- Benefit payments to Members are recorded upon
distribution. Amounts allocated to accounts of persons who have elected to
withdraw from the Plan but have not yet been paid were $117 and $272 at December
31, 2004 and 2003 respectively.
F-7
3. INVESTMENTS
The following presents investments that represent 5 percent or more of the
Plan's assets:
December 31
----------------------------
2004 2003
---------- ----------
*ITT Industries Common Stock, 7,440,879 and 7,833,063 shares
respectively, at fair value $ 628,382 $ 581,292
Investment Contract with Monumental Life Insurance Company,
at contract value $ 187,669 $ 186,971
Investment Contract with Caisse des Depots et Consignations,
at contract value $ 193,597 $ 184,094
JP Morgan Index Fund, 8,631,803 and 8,875,652 shares
respectively, at fair value $ 196,028 $ 180,412
Investment Contract with Bank of America, at contract value $ 179,353 $ 161,442
----------
* Permitted party-in-interest
During 2004, the Plan's investments (including gains and losses on investments
bought and sold, as well as held during the year) appreciated in value by
$141,756, as follows:
Mutual Funds $ 35,279
Common Stock 106,735
Corporate Bond (15)
U.S. Bonds (344)
U.S. Notes 94
Other Federal Agencies 7
-----------
Net appreciation $ 141,756
===========
4. PLAN TRUSTEE
State Street Bank and Trust Company served as the Plan's Trustee for the period
from January 1, 2004 to December 31, 2004. Fees paid by the Plan for Trustee
services provided by State Street Bank and Trust Company amounted to $346 for
the year ended December 31, 2004.
F-8
5. FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by letter
dated February 12, 2004 that the Plan and related trust are designed in
accordance with applicable sections of the Code. The Plan Administrator and the
Plan's tax counsel believe that the Plan is designed and is currently being
operated in compliance with the applicable requirements of the Code.
6. INVESTMENT CONTRACTS WITH INSURANCE AND OTHER FINANCIAL INSTITUTIONS.
The Plan has entered into numerous group annuity contracts with five regulated
insurance companies and other financial institutions. These contracts, which are
classified as part of the Stable Value Fund, are included in the financial
statements at contract value because they are fully benefit responsive. Contract
value represents contributions made under the contract, plus earnings and less
Plan withdrawals and administrative expenses. The fair value of the investment
contracts at December 31, 2004 and 2003 was $622,473 and $617,206, respectively.
The aggregate fair value of these contracts was in excess of the book value at
December 31, 2004 by approximately $12,220 and $17,958 at December 31, 2003.
There are no reserves against contract value for credit risk of the contract
issuer or otherwise. The average yield of the investment contracts at December
31, 2004 and for the year ended December 31, 2004 was 4.43% and 4.45%
respectively. The crediting interest rate for the investment contracts ranged
from 4.30% to 4.52% at December 31, 2004 and from 3.18% to 6.17% at December 31,
2003. The crediting interest rates are based on an agreed-upon formula with the
issuers, but cannot be less than zero. The investment contracts have scheduled
maturities from March 30, 2006 to May 31, 2018.
7. RELATED PARTY TRANSACTIONS
At December 31, 2004 and 2003, the Plan held 7,440,879 and 7,833,063 shares,
respectively, of common stock of ITT Industries, Inc., the sponsoring employer,
with a cost basis of $288,205 and $273,028, respectively. During the year ended
December 31, 2004, the Plan recorded related dividend income of $5,165.
Certain administrative functions are performed by the officers and employees of
the Company (who may also be participants in the Plan) at no cost to the Plan.
These transactions are not deemed prohibited party-in-interest transactions,
because they are covered by statutory or administrative exemptions from the Code
and ERISA's rules on prohibited transactions.
F-9
8. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan termination,
Members will become 100% vested in their accounts.
9. ASSET TRANSFERS
During 2004, assets in the amount of $71 were transferred to the Plan from the
C&K Components, Inc. Profit Sharing Plan and Trust.
10. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits according
to the financial statements to the Plan's Form 5500:
As of
December 31
-------------------------------
2004 2003
------------ ------------
Net assets available for benefits per the financial statements $ 1,915,317 $ 1,741,095
Amounts allocated to withdrawing Members (117) (272)
------------ ------------
Net assets available for benefits per the Form 5500 $ 1,915,200 $ 1,740,823
============ ============
The following is a reconciliation of benefits paid (withdrawals) to Members
according to the financial statements to the Form 5500:
Year Ended
December 31, 2004
-----------------
Benefits paid to Members per the financial statements $ 100,531
Add: Amounts allocated to withdrawing Members at December 31, 2004 117
Less: Amounts allocated to withdrawing Members at December 31, 2003 (272)
------------
Benefits paid to Members per the Form 5500 $ 100,376
============
F-10
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
--- ----------------------------------------------- ------------------------------------------------------- -------- -----------
* State Street Bank + Trust Co Short Term Interest Bearing Cash ** 37,806,984
Investment Fund
FNMA Pool 481585 US Government Agency ** 83,439
Maturity 2/1/29, Interest 6%
FNMA Pool 491783 US Government Agency ** 94,723
Maturity 3/1/14, Interest 6%
United States Treasury Bonds US Government Security ** 4,736,443
Maturity 8/15/13, Interest 12%
United States Treasury Notes US Government Security ** 5,696,089
Maturity 3/31/05, Interest 1.625%
United States Treasury Notes US Government Security ** 3,650,685
Maturity 8/31/05, Interest 2%
United States Treasury Notes US Government Security ** 11,909,331
Maturity 7/15/09, Interest 3.625%
Associates Corp North America Corporate Debt Instrument ** 310,288
Maturity 1/15/05, Interest 6.1%
Assured Guaranty Ltd Common Stock ** 1,062,180
F-11
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
--- ----------------------------------------------- ------------------------------------------------------- -------- -----------
Axis Capital Holdings Ltd Common Stock ** 1,056,096
Cooper Industries Ltd Common Stock ** 699,267
Willis Group Holdings Ltd Common Stock ** 975,729
XL Capital Ltd Common Stock ** 2,632,335
Flextronics International Ltd Common Stock ** 878,952
ADC Telecommunications Inc Common Stock ** 182,776
Agilent Technologies Inc Common Stock ** 759,150
Alcoa Inc Common Stock ** 1,410,758
Altria Group Inc Common Stock ** 916,500
Aluminum Corp China Ltd Common Stock ** 807,990
American Electric Power Inc Common Stock ** 985,558
Amercan International Group Inc Common Stock ** 584,463
Aquila Inc. Common Stock ** 381,546
Arrow Electronics Inc Common Stock ** 486,000
Avnet Inc Common Stock ** 337,440
Bp Plc Common Stock ** 2,049,840
F-12
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING
(a) (b) IDENITY OF ISSUER, BORROWER, MATURITY DATE, RATE OF INTEREST, (e) CURRENT
LESSOR OR SIMILAR PARTY COLLATERAL PAR OR MATURITY VALUE (d) COST VALUE
---- ---------------------------------------- ---------------------------------------- -------- -----------
Bank America Corp Common Stock ** 2,278,075
Bank of New York Inc Common Stock ** 1,797,996
Boeing Co Common Stock ** 1,030,223
Borg Warner Inc Common Stock ** 758,380
Burlington Northern Santa Fe Corportaion Common Stock ** 979,317
Cigna Corp Common Stock ** 1,207,236
CSX Corp. Common Stock ** 1,899,792
Chevrontexaco Corp Common Stock ** 1,396,766
Chubb Corp Common Stock ** 1,784,080
Citigroup Inc Common Stock ** 3,175,062
Comcast Corp New Common Stock ** 916,236
Community Health Systems Inc Common Stock ** 496,264
Companhia Vale Do Rio Doce Common Stock ** 818,082
Conocophillips Common Stock ** 2,127,335
Conseco Inc Common Stock ** 905,730
Cooper Cameron Corp Common Stock ** 1,388,298
F-13
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING
(a) (b) IDENITY OF ISSUER, BORROWER, MATURITY DATE, RATE OF INTEREST, (e) CURRENT
LESSOR OR SIMILAR PARTY COLLATERAL PAR OR MATURITY VALUE (d) COST VALUE
---- ---------------------------------------- ---------------------------------------- -------- -----------
Cooper Tire and Rubber Company Common Stock ** 140,075
Directv Group Inc Common Stock ** 964,224
Du Pont EI De Nemours and Company Common Stock ** 1,667,700
Eaton Vance Corp Common Stock ** 1,136,870
Education Management Corp Common Stock ** 613,986
Entergy Corp. Common Stock ** 953,019
Federal Home Loan Mortgage Corp. Common Stock ** 611,710
Federal National Mortgage Association Common Stock ** 1,516,773
Federated Department Stores Inc. Common Stock ** 485,436
Firstenergy Corp Common Stock ** 351,639
General Electric Co Common Stock ** 2,927,300
Glaxosmithkline Plc Common Stock ** 2,469,019
Goldman Sachs Group Inc Common Stock ** 655,452
Graftech International Ltd Common Stock ** 444,620
Great Lakes Chemical Corp Common Stock ** 1,339,030
Harmony Gold Mng Ltd Common Stock ** 919,584
F-14
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING
(a) (b) IDENITY OF ISSUER, BORROWER, MATURITY DATE, RATE OF INTEREST, (e) CURRENT
LESSOR OR SIMILAR PARTY COLLATERAL PAR OR MATURITY VALUE (d) COST VALUE
---- ---------------------------------------- ---------------------------------------- -------- -----------
Hartford Financial Services Group Common Stock ** 533,687
Hewitt Associates Inc Common Stock ** 1,053,129
Hewlett Packard Co Common Stock ** 2,382,192
IDT Corp Common Stock ** 352,944
IAC/Interactive Space Corp Common Stock ** 1,063,370
ITT Educational Services Inc. Common Stock ** 946,245
* ITT Industries, Inc. Common Stock ** 628,382,232
Ingram Micro Inc Common Stock ** 386,880
International Paper Co Common Stock ** 1,608,432
Interpublic Group Co. Inc Common Stock ** 1,669,640
Janus Capital Group Inc Common Stock ** 1,151,485
Jones Apparel Group Inc Common Stock ** 629,004
Kimberly Clark Corp Common Stock ** 427,765
Kroger Co Common Stock ** 2,269,676
Lear Corp Common Stock ** 713,817
Lehman Brothers Holdings Inc. Common Stock ** 1,417,176
F-15
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING
(a) (b) IDENITY OF ISSUER, BORROWER, MATURITY DATE, RATE OF INTEREST, (e) CURRENT
LESSOR OR SIMILAR PARTY COLLATERAL PAR OR MATURITY VALUE (d) COST VALUE
---- ---------------------------------------- ---------------------------------------- -------- -----------
Lilly Eli & Co. Common Stock ** 800,175
Lockheed Martin Corp Common Stock ** 222,200
Lyondell Chemical Co Common Stock ** 905,196
Magna International Inc Common Stock ** 817,245
Manhattan Associates Inc Common Stock ** 831,024
Manpower Inc. Common Stock ** 1,096,410
McDonalds Corp Common Stock ** 1,134,924
Meadwestvaco Corp Common Stock ** 1,753,808
Medco Health Solutions Inc Common Stock ** 2,907,840
Medimmune Inc Common Stock ** 656,062
Mellon Financial Corp Common Stock ** 843,081
Merck & Co Inc Common Stock ** 896,706
Merrill Lynch & Co Inc Common Stock ** 1,673,560
Metlife Inc Common Stock ** 1,215,300
Microsoft Corp Common Stock ** 3,183,832
Nalco Holding Co. Common Stock ** 888,160
F-16
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING
(a) (b) IDENITY OF ISSUER, BORROWER, MATURITY DATE, RATE OF INTEREST, (e) CURRENT
LESSOR OR SIMILAR PARTY COLLATERAL PAR OR MATURITY VALUE (d) COST VALUE
---- ---------------------------------------- ---------------------------------------- -------- -----------
National City Corp Common Stock ** 1,652,200
National Financial Partners Corp Common Stock ** 395,760
National Oilwell Inc Common Stock ** 483,473
Navistar International Corp Inc Common Stock ** 664,098
Nokia Corp Common Stock ** 817,974
Norfolk Southern Corp Common Stock ** 1,798,643
Nortel Networks Corp Common Stock ** 247,556
Occidental Petroleum Corp Common Stock ** 1,587,392
Office Depot Inc Common Stock ** 763,840
Olin Corp Common Stock ** 935,850
Parker Hannifin Corp Common Stock ** 575,624
Pepsico Inc Common Stock ** 1,143,180
Pfizer Inc Common Stock ** 949,217
Polo Ralph Lauren Corp Common Stock ** 664,560
Principal Financial Group Common Stock ** 1,408,336
Procter And Gamble Co Common Stock ** 682,992
F-17
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
----- ----------------------------------- ------------------------------------------------------- -------- -----------
Radio One Inc Common Stock ** 765,700
Rowan Cos Inc Common Stock ** 1,095,570
SBC Communications Inc Common Stock ** 1,151,919
Safeway Inc Common Stock ** 442,176
The St Paul Travelers Companies Inc Common Stock ** 382,340
Sanmina Sci Corp Common Stock ** 308,308
Schlumberger Ltd Common Stock ** 1,385,865
Schwab Charles Corp Common Stock ** 599,196
Sempra Energy Common Stock ** 143,052
Smurfit Stone Container Corp Common Stock ** 634,410
Solectron Corp Common Stock ** 595,894
Sprint Corp Common Stock ** 934,360
Suntrust Banks Inc Common Stock ** 1,012,156
Symbol Technologies Inc Common Stock ** 1,164,290
Target Corp Common Stock ** 1,100,916
Tech Data Corp Common Stock ** 812,660
F-18
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
----- ----------------------------------- ------------------------------------------------------- -------- -----------
Tellabs Inc Common Stock ** 655,417
Tenet Healthcare Corp Common Stock ** 1,004,670
Textron Inc Common Stock ** 1,675,260
Time Warner Inc Common Stock ** 1,487,160
Todco Common Stock ** 370,242
Torchmark Inc Common Stock ** 834,244
Toys R Us Inc Common Stock ** 863,834
Unilever N V Common Stock ** 660,429
Unumprovident Corp Common Stock ** 1,663,038
Viacom Inc Common Stock ** 883,149
Wachovia Corp Common Stock ** 1,535,920
Watson Pharmaceuticals Inc Common Stock ** 518,398
Westwood One Inc Common Stock ** 1,236,087
Wisconsin Energy Corp Common Stock ** 347,213
* Participants Loans Participant Loans ** 23,358,996
The Loan interest rate ranges varied from 4% - 11%
JP Morgan Chase Public Bonds Fund Common/Collective Trust ** 26,346,065
JP Morgan Chase Mortgage Private Placement Fund Common/Collective Trust ** 10,288,087
Morgan Guaranty Trust Co Of NY Liquidity Fund Common/Collective Trust ** 932,354
JP Morgan Special Sit Property Fund Common/Collective Trust ** 205,098
F-19
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
----- ----------------------------------- ------------------------------------------------------- -------- -----------
JP Morgan International Bond Fund Common/Collective Trust ** 375,785
JP Morgan Corporate High Yield Common/Collective Trust ** 489,599
Opportunity Fund
JP Morgan Chase Macs Equity Common/Collective Trust ** 1,244,488
ITT Emerging Markets Fund-JP Morgan Common/Collective Trust ** 490,641
Aggressive Fund
JP Morgan Chase + Co Common/Collective Trust ** 2,556,247
JP Morgan Chase US Act Fixed Core Common/Collective Trust ** 9,234,764
JP Morgan Chase US Real Estate Sec Common/Collective Trust ** 717,622
JP Morgan Chase Disc Eq Fund Common/Collective Trust ** 2,840,193
JP Morgan Chase Strat Small Comp Eq Common/Collective Trust ** 2,768,109
JP Morgan Emerging Markets Eq Foc Common/Collective Trust ** 169,145
Fund
JP Morgan Index Common/Collective Trust ** 196,028,239
JP Morgan Chase Strategic Property Common/Collective Trust ** 268,258
Fund
JP Morgan Chase Eafe Equal Common/Collective Trust ** 1,865,689
Opportunity Fund
JP Morgan Chase US Aalyst Fund Common/Collective Trust ** 4,918,296
JP Morgan Chase Emerging Markets Common/Collective Trust ** 495,361
Fixed Income
F-20
ITT INDUSTRIES INVESTMENT AND SAVINGS PLAN FOR SALARIED EMPLOYEES EIN: 13-5158950
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS (HELD AT END OF YEAR) PN: 100
AS OF DECEMBER 31, 2004
(c) DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE,
(b) IDENITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL PAR OR (e) CURRENT
(a) LESSOR OR SIMILAR PARTY MATURITY VALUE (d) COST VALUE
----- ----------------------------------- ------------------------------------------------------- -------- -------------
JP Morgan Chase Eafe Plus Fund Common/Collective Trust ** 2,090,916
American Century Quantitative Small Registered Investment Company ** 65,657,388
Capital Quanitative Fund
American Century Mutual Funds Inc - Registered Investment Company ** 67,950,513
Twentieth Century Ultra Fund
New Perspective Fund Inc Registered Investment Company ** 71,785,215
Bank Of America Insurance Company General Account ** 178,682,010
Maturity 6/30/06, Interest 3.910%
Business Mens Assurance Co Insurance Company General Account ** 11,216,147
Maturity 3/30/06, Interest 4.8%
Caisse Des Depots Et Consignations Insurance Company General Account ** 192,774,873
Maturity 4/1/08, Interest 1%
JP Morgan Chase Bank Insurance Company General Account ** 25,276,686
Maturity 12/31/05, Interest 3.180%
Monumental Insurance Company General Account ** 187,027,311
Maturity 4/1/15, Interest 5.133%
-------------
TOTAL ** 1,914,551,731
=============
* Party-in-interest to the Plan
** Cost information is not required for participant directed investments and,
therefore, is not included.
F-21