-  Any difficulties in obtaining or retaining the management and other human resource competencies that the Company  needs to achieve its business objectives. -  The risks associated with any technological shifts away from the Company's technologies and core competencies. For  example, a technological shift away from the use of coaxial cable in cable television/telecommunication systems could  have a substantial impact on the Company's coaxial cable business. -  Unforeseen interruptions to the Company's business with its largest customers, distributors and suppliers resulting  from, but not limited to, strikes, financial instabilities, computer malfunctions or inventory excesses. Item 2. Properties  The Company's fixed assets include certain plants and warehouses and a substantial quantity of machinery and equipment,  most of which is general purpose machinery and equipment using tools and fixtures and in many instances having automatic control  features and special adaptations. The Company's plants, warehouses, machinery and equipment are in good operating condition, are  well maintained, and substantially all of its facilities are in regular use. The Company considers the present level of fixed assets  along with planned capital expenditures as suitable and adequate for operations in the current business environment. At  December 31, 2004, the Company operated a total of 97 plants and warehouses of which (a) the locations in the U.S. had  approximately 1.9 million square feet, of which 0.7 million square feet were leased; (b) the locations outside the U.S. had  approximately 2.9 million square feet, of which 1.6 million square feet were leased; and (c) the square footage by segment was  approximately 3.9 million square feet and 0.9 million square feet for interconnect products segment and cable products segment,  respectively. The Company believes that its facilities are suitable and adequate for the business conducted therein and are being  appropriately utilized for their intended purposes. Utilization of the facilities varies based on demand for the products. The Company  continuously reviews its anticipated requirements for facilities and, based on that review, may from time to time acquire or lease  additional facilities and/or dispose of existing facilities. Item 3. Legal Proceedings  The Company and its subsidiaries have been named as defendants in several legal actions in which various amounts are  claimed arising from normal business activities. Although the amount of any ultimate liability with respect to such matters cannot be  precisely determined, in the opinion of management, such matters are not expected to have a material effect on the Company's  financial condition or results of operations. Certain operations of the Company are subject to federal, state and local environmental laws and regulations which govern  the discharge of pollutants into the air and water, as well as the handling and disposal of solid and hazardous wastes. The Company  believes that its operations are currently in substantial compliance with all applicable environmental laws and regulations and that  the costs of continuing compliance will not have a material effect on the Company's financial condition or results of operations. Subsequent to the acquisition of Amphenol from Allied Signal Corporation (“Allied Signal”) in 1987 (Allied Signal  merged with Honeywell International Inc. in December 1999 ("Honeywell")), Amphenol and Honeywell have been named jointly  and severally liable as potentially responsible parties in relation to several environmental cleanup sites. Amphenol and Honeywell  have jointly consented to perform certain investigations and remedial and monitoring activities at two sites and they have been  jointly ordered to perform work at another site. The costs incurred relating to these three sites are currently reimbursed by  Honeywell based on an agreement (the “Honeywell Agreement”) entered into in connection with the acquisition in 1987. For sites  covered by the Honeywell Agreement, to the extent that conditions or circumstances occurred or existed at the time of or prior to the  acquisition, Honeywell is obligated to reimburse Amphenol 100% of such costs. Honeywell representatives continue to work  closely with the Company in addressing the most significant environmental liabilities covered by the Honeywell Agreement. Management does not believe that the costs associated with resolution of these or any other environmental matters will have a  material adverse effect on the Company’s financial condition or results of operations. The environmental investigation, remedial and  monitoring activities identified by the Company, including those referred to above, are covered under the Honeywell Agreement. Owners and occupiers of sites containing hazardous substances, as well as generators of hazardous substances, are subject  to broad liability under various federal and state environmental laws and regulations, including expenditures for cleanup and  monitoring costs and potential damages arising out of past disposal activities. Such liability in many cases may be imposed  21 A M P H E N O L C O R P O R A T I O N 2 0 0 4 A N N U A L R E P O R T 