##### 



SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) þ
    
    Annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934
 For the fiscal year ended December 31, 2004
 o
    
    Transition report pursuant to Section 15(d) of
the Securities Exchange Act of 1934
 For the transition period ___to ___
 Commission file number 1-7260  A.
    
    Full title of the plan and the address of the plan, if different from that of the issuer named
below: Nortel Networks
Long-Term Investment Plan
(formerly the Northern Telecom Inc.
Long-Term Investment Plan)
220 Athens Way, Suite 300
Nashville, Tennessee 37228  B.
    
    Name of issuer of the securities held pursuant to the plan and the address of its principal
executive office: Nortel Networks
Corporation




---



##### 



REQUIRED INFORMATION Financial Statements and Exhibits a)
    
    Financial StatementsIndex to Financial StatementsLong-Term Investment PlanReport of Independent Registered Public Accounting Firm
    
    
    
    1Financial Statements as of and for the Years Ended December 31, 2004 and 2003:Statements of Net Assets Available for Benefits
    
    
    
    2Statements of Changes in Net Assets Available for Benefits
    
    
    
    3Notes to Financial Statements
    
    
    
    4-9Supplemental Schedules as of and for the Year Ended December 31, 2004:Schedule of Assets (Held at End of Year)
    
    
    
    10Schedule of Reportable Transactions
    
    
    
    11b)
    
    Exhibits23.1       Consent of Deloitte & Touche LLP
 Supplemental schedules other than those listed above have been omitted due to the absence of the
conditions under which they are required. 2




---



##### 



Signature Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other
persons who administer the Nortel Networks Long-Term Investment Plan) have duly caused this annual
report to be signed by the undersigned thereunto duly authorized. NORTEL NETWORKS LONG-TERM INVESTMENT PLANBy:
    
    /s/ Mary M. CrossMary M. CrossPresident, Nortel Networks Inc.
 Date: June 30, 2005 3




---



##### 



Nortel Networks Long-Term Investment Plan Financial Statements as of and for the
Years Ended December 31, 2004 and 2003,
Supplemental Schedules as of and for the
Year Ended December 31, 2004, and Report
of Independent Registered Public Accounting Firm




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN TABLE OF CONTENTS  PageREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
    
    
    1FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED
DECEMBER 31, 2004 AND 2003:Statements of Net Assets Available for Benefits
    
    
    2Statements of Changes in Net Assets Available for Benefits
    
    
    3Notes to Financial Statements
    
    
    4-9SUPPLEMENTAL SCHEDULES AS OF AND FOR THE YEAR ENDED
DECEMBER 31, 2004:Schedule of Assets (Held at End of Year)
    
    
    10Schedule of Reportable Transactions
    
    
    11
 Supplemental schedules other than those listed above have been omitted because of the absence of
the conditions under which they are required.




---



##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To Nortel Networks, Inc. and Participants of the
Nortel Networks Long-Term Investment Plan
Nashville, Tennessee We have audited the accompanying statements of net assets available for benefits of the Nortel
Networks Long-Term Investment Plan (the Plan) as of December 31, 2004 and 2003, and the related
statements of changes in net assets available for benefits for the years then ended. 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 years then ended 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 schedules listed in the Table of Contents are presented for the
purpose of additional analysis and are not a required part of the basic financial statements, but
are 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. These schedules
are the responsibility of the Plans management. Such schedules have been subjected to the auditing
procedures applied in our audit of the basic 2004 financial statements and, in our opinion, are
fairly stated in all material respects when considered in relation to the basic financial
statements taken as a whole. /s/ Deloitte & Touche LLP Nashville, Tennessee
June 28, 2005




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 2004 AND 2003  2004
    
    
    2003ASSETS:Investments, at fair value:Nortel Networks Corporation common shares
    
    $
    268,284,240
    
    
    $
    424,833,032Commingled funds
    
    
    450,259,169
    
    
    
    382,250,015Mutual funds
    
    
    678,863,407
    
    
    
    536,512,261Temporary investments
    
    
    12,975,976
    
    
    
    10,689,119Participant loans receivable
    
    
    28,162,056
    
    
    
    24,884,3781,438,544,848
    
    
    
    1,379,168,805Group annuity contracts, at contract value
    
    
    646,886,430
    
    
    
    573,815,509Total investments
    
    
    2,085,431,278
    
    
    
    1,952,984,314Receivables:Nortel Networks Inc. contributions
    
    
    
    
    
    
    2,530,801Interest and dividends
    
    
    167,060
    
    
    
    132,933Total receivables
    
    
    167,060
    
    
    
    2,663,734LIABILITIES:Accrued investment expenses
    
    
    77,732
    
    
    
    76,670Total liabilities
    
    
    77,732
    
    
    
    76,670NET ASSETS AVAILABLE FOR BENEFITS
    
    $
    2,085,520,606
    
    
    $
    1,955,571,378
 See notes to financial statements. - 2 -




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 2004 AND 2003  2004
    
    
    2003ADDITIONS TO NET ASSETS ATTRIBUTABLE TO:Net investment gain:Net appreciation in fair value of investments:Nortel Networks Corporation common shares
    
    $
    
    
    
    $
    239,737,740Commingled funds
    
    
    47,998,538
    
    
    
    79,915,925Mutual funds
    
    
    76,381,344
    
    
    
    105,726,099Other funds
    
    
    505Total net appreciation in fair value of investments
    
    
    124,380,387
    
    
    
    425,379,764Interest and dividends
    
    
    37,372,698
    
    
    
    39,591,522Contributions:Participant
    
    
    111,977,534
    
    
    
    113,797,825Nortel Networks Inc.
    
    
    49,047,838
    
    
    
    48,516,926Total additions
    
    
    322,778,457
    
    
    
    627,286,037DEDUCTIONS TO NET ASSETS ATTRIBUTABLE TO:Net investment loss:Net depreciation in fair value of investments:Nortel Networks Corporation common shares
    
    
    (40,132,811
    )Total net depreciation in fair value of investments
    
    
    (40,132,811
    )
    
    
    Investment expenses
    
    
    (795,714
    )
    
    
    (1,162,612
    )Total deductions
    
    
    (40,928,525
    )
    
    
    (1,162,612
    )BENEFITS PAID TO PARTICIPANTS
    
    
    (151,900,704
    )
    
    
    (162,099,007
    )NET INCREASE
    
    
    129,949,228
    
    
    
    464,024,418NET ASSETS AVAILABLE FOR BENEFITS:Beginning of year
    
    
    1,955,571,378
    
    
    
    1,491,546,960End of year
    
    $
    2,085,520,606
    
    
    $
    1,955,571,378
 See notes to financial statements. - 3 -




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003   1.
    
    DESCRIPTION OF PLANThe following brief description of the Nortel Networks Long-Term Investment Plan (the Plan)
is provided for general information purposes only. Participants should refer to the Plan
document for more complete information.GeneralThe Plan, effective July 1, 1979, as amended and restated effective August 15, 2002,
and further amended as of April 1, 2003, and again on January 1, 2005, is a defined
contribution plan for employees of Nortel Networks Inc. (NNI) and its participating
subsidiaries and affiliates (collectively, the Company) and is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA). The Company established The
Nortel Networks Long-Term Investment Plan Trust (the Trust Agreement) with The Northern Trust
Company (Northern Trust), as trustee of the funds, effective November 3, 2003. Previously,
the assets of the trust were held by Deutsche Bank Trust Company Americas as trustee under the
Nortel Networks Master Savings Plan Trust. Plan membership is available upon the employees
employment commencement date to any employee of the Company, excluding employees governed by a
collective bargaining agreement.ContributionsEffective April 1, 2003,a participant may elect to contribute up to 50% of their
eligible compensation, as defined by the Plan document, up to a maximum of $13,000 and $12,000
for 2004 and 2003, respectively. Participant contributions to the Plan are made by means of
payroll deductions during each regular payroll period. A participant may make rollover
contributions directly from certain other qualified plans or from certain qualified special
individual retirement accounts, which a participant may have established as a result of prior
distributions from such qualified plans or accounts. Effective April 1, 2003, the plan allows
participants age 50 and older to make an additional catch-up contribution of up to $3,000 and
$2,000 for 2004 and 2003, respectively.Participants in the Plan elect one of three benefit options with Company contributions varying
based upon the elected option. Depending on the participants elected option, the Company
contributes to the Plan 50%, 60%, or 100% of the participants contributions that do not exceed
6% of the participants eligible earnings.Investment OptionsParticipants may elect to have the balance of their account and any current
contributions invested in the following sixteen investment funds: Barclays Masterworks Lifepath 2000/2010/2020/2030/2040 Funds
Fidelity Low-Priced Stock Fund
Fixed Income Investment Fund
Franklin Templeton Foreign Fund
Nortel Networks Stock Fund
NTGI Russell 1000 Value Equity Index Fund
NTGI S&P 500 Equity Index Fund
PIMCO (Pacific Investment Management Company) RCM Large-Cap Growth Fund - 4 -




---



##### 



PIMCO (Pacific Investment Management Company) Total Return Fund
Royce Premier Fund
Scudder Lifecycle Long Range Fund
Scudder Mid-Cap Fund  The following is a summarized description of each investment option available in the Plan taken
from the funds prospectus: Barclays Masterworks Lifepath 2000/2010/2020/2030/2040 Funds: These five funds invest in
a blend of stock, bond, and money market instruments seeking to produce competitive
returns over a set period of time. The portfolio changes its investment mix gradually as
it approaches its target date. Within the five Masterworks Lifepath funds, investors may
select a fund closest to the year they plan to retire. Masterworks Lifepath 2000 Fund is
the most conservative of these funds and Masterworks Lifepath 2040 Fund is the most
aggressive. Fidelity Low-Priced Stock Fund: The objective of the fund is to provide capital
appreciation through investment in either growth stocks or value stocks or both. Under
normal circumstances, the fund will invest at least 80% of assets in low-priced stocks,
defined as those priced at or below $35 per share, which can lead to investments in small-
and medium-sized companies. The fund can also potentially invest in stocks not considered
low-priced. Fidelity Investments closed the Fidelity Low-Priced Stock Fund to all new participants as
of the market close on July 30, 2004. Participants who already have a balance in this fund
as of that date will be able to continue to invest in the fund and can continue to request
transfers, as well as make new contributions to the fund. Participants who do not have a
balance in this fund as of July 30, 2004, will not be able to invest in the fund, either
by requesting transfers or making new contributions into the Fund. Fixed Income Investment Fund: The objective of the fund is to provide stability of
principal with potentially higher returns than money market funds over most time periods.
The fund is comprised primarily of investment contracts (Contracts) and securities
carried at book value to protect the portfolio from gains and losses associated with
interest rate movements. The Contracts held by this fund are with various insurance companies or other financial
institutions. The issuing companies have agreed to provide this fund with a net fixed or
floating contract interest rate that is to be earned over a specified period and payment
of principal and interest upon participant initiated withdrawals and/or transfers of
assets. The Contracts are included in the financial statements at contract value, which
represents contributions made under the contract, plus accumulated earnings, less
withdrawals and administrative expenses. The contract value and fair value of the
Contracts were $646,886,430 and $659,229,567, respectively, at December 31, 2004. The
contract value of the Contracts approximates their fair value at December 31, 2003. Plan
management believes no reserves are necessary against contract value for credit risk of
the contract issuer or otherwise as of December 31, 2004 and 2003. The average yield of the Contracts held by the fund during 2004 and 2003 was 4.72% and
5.28%, respectively. The average crediting interest rate for the contracts held by the
fund at December 31, 2004 and 2003 was 4.76% and 4.62%, respectively. The crediting
interest rate is based on an agreed-upon formula with the issuer. Franklin Templeton Foreign Fund: The objective of the fund is to provide long-term
capital growth by investing primarily in the equity securities of companies located
outside the United - 5 -




---



##### 



States, including emerging markets. Under normal circumstances, the fund will invest at
least 80% of its net assets in foreign securities, which may include emerging markets.
Depending upon current market conditions, the fund will also invest a portion of its total
assets in debt securities of companies and governments located anywhere in the world. Nortel Networks Stock Fund: This fund is primarily comprised of Nortel Networks
Corporation (NNC) common shares, with a percentage of assets in cash-equivalents for
liquidity purposes. This company stock fund is not diversified, and therefore is
considered riskier than other diversified broad market funds. NTGI Russell 1000 Value Equity Index Fund: The objective of the fund is to approximate
the risk and return characteristics of the Russell 1000 Value Index. This Index is
commonly used to represent the large cap segment of the U.S. equity market with a focus on
the value style of investing. The fund employs a replication technique which generally
seeks to hold each index constituent in its proportional index weight. NTGI S&P 500 Equity Index Fund: The objective of the fund is to approximate the risk and
return characteristics of the Standard and Poors (S&P) 500 Index. This Index is
commonly used to represent the large cap segment of the U.S. equity market and tracks 500
companies considered to be representative of the United States economy. The fund employs a
replication technique which generally seeks to hold each index constituent in its
proportional index weight. PIMCO RCM Large-Cap Growth Fund: The objective of the fund is to provide long-term
capital appreciation by investing at least 80% of its net assets in equity securities of
U.S. companies with market capitalizations of at least $3 billion. The portfolio
management team ordinarily looks for several of the following characteristics when
analyzing specific companies for possible investment: higher than average growth and
strong potential for an expanding market or market share; a strong balance sheet; superior
management; strong commitment to research and product development; and differentiated or
superior products and services; and a steady stream of new products and services. Effective April 1, 2005, this fund will be renamed the Allianz RCM Large-Cap Growth Fund.
The new name reflects PIMCOs relationship with its corporate parent, Allianz AG. This
name change does not result in a change to the investment objective of the fund or the
funds ticker symbol. PIMCO Total Return Fund: The object of the fund is to seek maximum total return,
consistent with preservation of capital and prudent investment management. This fund
invests at least 65% of its total assets in a diversified portfolio of fixed income
instruments of varying maturities under normal circumstances. The average portfolio
duration of this fund normally varies within a three- to six-year time frame. Royce Premier Fund: The objective of the fund is to provide long-term growth of capital.
The fund generally invests in a limited number of equity securities issued by small
companies with stock market capitalizations between $500 million and $2.5 billion. The
fund looks for companies that it considers premier, or those that have excellent
business strengths and/or prospects for growth, high internal rates of return and low
leverage, and that are trading significantly below its estimate of their current worth.
Under normal circumstances, the fund will invest at least 80% of its net assets in the
equity securities of such premier companies, with at least 65% of these securities being
issued by companies with stock market capitalizations of less than $2.5 billion. Scudder Lifecycle Long Range Fund: The objective of the fund is to provide high total
return with reduced risk over the long-term. The fund invests primarily in three principal
asset classes: stocks, - 6 -




---



##### 



bonds, and short-term instruments. The investment advisor will generally allocate the
largest portion of its assets to stocks, with smaller allocations to bonds and short-term
instruments. The fund regularly uses derivatives to increase or decrease its exposure to
the various asset classes. Scudder Mid-Cap Fund: The objective of the fund is to provide long-term capital growth
through investments primarily in equity securities of medium-sized growth-oriented
companies. Under normal circumstances, the fund will invest at least 80% of its assets in
companies with market caps within the market capitalization range of the Russell Mid Cap
Growth Index or securities with equity characteristics that provide exposure to those
companies.  VestingParticipants are immediately vested in their participant contributions and any rollover
contributions made to the Plan. In addition, participants are immediately vested in the Company
contributions made to the Plan.WithdrawalsUpon proper notification to the Company, participants may withdraw all or any part
of, but not less than $100, the value of participant and Company contributions plus earnings,
subject to certain restrictions. If the value of Company contributions being withdrawn is
invested in NNC common shares and represents fewer than 50 common shares, the distribution will
be made in cash. If the value of Company contributions represents 50 common shares or more, the
participant may request a cash or share distribution, provided that, in the event a participant
requests a share distribution, at least 50 common shares are distributed.Payment of BenefitsA participant who retires from employment with the Company after age 65 or
who is terminated after age 59 1/2 is eligible for distribution of their account balance in the
form of a lump sum payment or installment payments. A participant who terminates employment
with the Company for any other reason is eligible only for a lump sum distribution of their
vested account balance. As of December 31, 2004 and 2003, there was $2,866,078 and $783,925 of
payments to participants or their beneficiaries for which applications were received prior to
year end that the Plan disbursed in the following fiscal years 2005 and 2004, respectively.LoansParticipants may borrow a minimum of $1,000 and up to a maximum equal to the lesser of
$50,000 or 50% of the value of the vested portion of their total account value. Loan
transactions are treated as a transfer to (from) the investment fund from (to) the Participant
Loan Fund, a holding account for participant loans receivable. Loan terms range from 1-5 years
for all loans except loans for mortgage purposes which may be repaid over a period of up to 15
years. The loans are secured by the balance in the participants account and bear interest at a
rate commensurate with prime plus one percent as determined by Northern Trust. Interest rates
ranged from 5.00% to 12.50% on outstanding loans at December 31, 2004. Principal and interest
are paid ratably through biweekly payroll deductions. Included in benefits paid to participants
is $0 and $4,107 in 2004 and 2003, respectively, for outstanding loans reclassified as
distributions upon termination of participants from the Plan.2.
    
    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBasis of AccountingThe financial statements of the Plan are prepared under the accrual method
of accounting.Investment ValuationPlan investments in NNC common shares are valued at the last reported
sales price, as quoted on the New York Stock Exchange, on December 31, 2004 and 2003. Plan
investments in securities investment funds are valued based upon the fair value of the
commingled funds, together with any uninvested cash, accrued income or assets, and any
dividends which have been declared but remain unpaid as of the calculation date, less all
transaction costs such as brokerage commissions. Plan - 7 -




---



##### 



investments in participant loans receivable are valued at cost which approximates fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is
recorded on the accrual basis and dividends are recorded on the ex-dividend date.Payment of BenefitsBenefit payments are recorded when paid.Administrative ExpensesAll administrative expenses may be paid by the Plan to the extent
permissible by law. However, for the years ended December 31, 2004 and 2003, the Company
elected to pay all such administrative expenses except those related to participants
investment transactions and trustee fees.Use of EstimatesThe preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the Plans 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 affect the amounts reported in the statements of net
assets available for plan benefits.3.
    
    PLAN TERMINATIONAlthough it has not expressed an intent to do so, the Company has the right under the Plan to
terminate the Plan subject to the provisions of ERISA.4.
    
    INTERNAL REVENUE SERVICE STATUSAs of January 14, 2004, the Internal Revenue Service has determined that the Plan is qualified
under Section 401(a) and meets the additional requirements of Section 401(k) of the Internal
Revenue Code (the Code). Therefore, no provision for income taxes has been included in the
Plans financial statements. Company contributions and participant contributions may be
excluded from the gross income of the participants for whom such contributions are made.5.
    
    INVESTMENTSInvestments of the Plan that represent five percent (5%) or more of net assets available for
benefits are as follows:  As of December 31, 2004*   Nortel Networks Corp Common Shares
    
    $
    268,284,240NTGI Russell 1000 Value Equity Index Fund
    
    
    118,004,761NTGI
S&P 500 Equity Index Fund
    
    
    270,273,144Fidelity Low-Priced Stock Fund
    
    
    250,851,789Scudder Investments Mid-Cap Fund
    
    
    157,724,763CDC Financial Group #WR 1173-001
    
    
    185,635,635JP Morgan Chase Benefit Responsive #ANORTH01
    
    
    132,422,603Monumental Guaranteed Investment Contract #ADA0020000TR
    
    
    110,284,758Monumental Guaranteed Investment Contract #ADA00262TR
    
    
    119,247,200
 - 8 -




---



##### 



As of December 31, 2003NTGI
S&P 500 Equity Index Fund
    
    $
    242,509,668Commonwealth Life Guaranteed Investment Contract #ADA002000TR
    
    
    105,164,910Commonwealth Life Guaranteed Investment Contract #ADA00262TR
    
    
    114,562,247CDC Financial Group #WR 1173-001
    
    
    176,745,758Scudder Investments Mid-Cap Fund
    
    
    146,753,278Fidelity Low-Priced Stock Fund
    
    
    171,671,034*Nortel Networks Corp Common Shares
    
    
    424,833,032JP Morgan Chase Benefit Responsive #ANORTH01
    
    
    126,186,532
 
 *
    
    Indicates a party-in-interest.  6.
    
    COMMITMENTS AND CONTINGENCIESOn September 12, 2003, a complaint consolidating three different putative class actions was
filed against NNC, NNI, and various named individuals and committees regarding their purported
responsibilities as fiduciaries of the Plan. A motion for dismissal of that lawsuit is
currently under review by the presiding judge. On May 18, 2004 and June 14, 2004, two new
complaints were filed also seeking to commence class action lawsuits against NNC and various
named individuals alleged to be fiduciaries under the Plan. The class periods described in the
new complaints are: December 23, 2003 to the present and October 24, 2000 to the present,
respectively. None of these lawsuits name the Plan as a defendant. Each of these lawsuits
allege, among other things, material misrepresentations and omissions to induce Plan
participants to continue to invest in and maintain investments in NNC common shares. By
agreement of the various parties, another amended complaint was filed by Plaintiffs on June 17,
2005. The response of the Defendants to that amended complaint is due July 8, 2005. The Plan is
unable to determine the impact of these matters, if any, on the Plan participants or the Plans
financial status or changes therein. * * * * * * - 9 -




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2004  Description of Investment IncludingIdentity of Issuer, Borrower, Lessor or
    
    Maturity Date, Rate of Interest,
    
    
    
    
    
    MarketSimilar Party
    
    Collateral, Par or Maturity Value
    
    Cost
    
    
    ValueUnited States Dollar
    
    Common/Collective Trust
    
    $
    12,975,976
    
    
    $
    12,975,976Barclays Masterworks Lifepath 2000 Fund
    
    Common/Collective Trust
    
    
    7,062,530
    
    
    
    7,721,506Barclays Masterworks Lifepath 2010 Fund
    
    Common/Collective Trust
    
    
    6,547,310
    
    
    
    7,467,321Barclays Masterworks Lifepath 2020 Fund
    
    Common/Collective Trust
    
    
    11,518,132
    
    
    
    12,974,051Barclays Masterworks Lifepath 2030 Fund
    
    Common/Collective Trust
    
    
    12,406,258
    
    
    
    13,883,641Barclays Masterworks Lifepath 2040 Fund
    
    Common/Collective Trust
    
    
    17,948,577
    
    
    
    19,934,745NTGI Russell 1000 Value Equity Index Fund
    
    Common/Collective Trust
    
    
    99,856,397
    
    
    
    118,004,761NTGI S&P 500 Equity Index Fund
    
    Common/Collective Trust
    
    
    237,388,758
    
    
    
    270,273,144Protective Life Insurance Contract #1713
    
    GIC, 1.00%, 12/06/06
    
    
    14,867,355
    
    
    
    14,867,355Bank of America Contract #04-012
    
    Synthetic GIC
    
    
    56,194,300
    
    
    
    56,194,300CDC Investment Management Contract #BR173-05
    
    Synthetic GIC
    
    
    28,234,579
    
    
    
    28,234,579CDC Investment Management Contract #WR1173-001
    
    Synthetic GIC
    
    
    185,635,635
    
    
    
    185,635,635JP Morgan Chase Benefit Responsive #ANORTH01
    
    Synthetic GIC
    
    
    132,422,603
    
    
    
    132,422,603Monumental Life Contract #ADA002000TR
    
    Synthetic GIC
    
    
    110,284,758
    
    
    
    110,284,758Monumental Life Contract #ADA00262TR
    
    Synthetic GIC
    
    
    119,247,200
    
    
    
    119,247,200Fidelity Low-Priced Stock Fund
    
    Mutual Fund
    
    
    196,339,711
    
    
    
    250,851,789Franklin Templeton Foreign Fund
    
    Mutual Fund
    
    
    80,334,832
    
    
    
    95,669,644PIMCO RCM Large-Cap Growth Fund
    
    Mutual Fund
    
    
    30,168,122
    
    
    
    33,946,907PIMCO Total Return Fund
    
    Mutual Fund
    
    
    59,431,760
    
    
    
    58,945,452Royce Premier Fund
    
    Mutual Fund
    
    
    1,147,042
    
    
    
    1,157,516Scudder Lifecycle Long Range Fund
    
    Mutual Fund
    
    
    86,185,091
    
    
    
    80,567,336Scudder Mid-Cap Fund
    
    Mutual Fund
    
    
    169,236,976
    
    
    
    157,724,763* Nortel Networks Corp New Common Shares
    
    Common Stock
    
    
    803,892,551
    
    
    
    268,284,240* Participant Loans
    
    Participant Loans with interest rates ranging from 5.00% to 12.50% and maturity dates ranging from 12/26/2003 and 10/25/2019
    
    
    **
    
    
    
    28,162,056Total Investments
    
    
    
    
    
    
    
    $
    2,085,431,278
 
 *
    
    Indicates a party-in-interest.**
    
    Cost information is not required for participant-directed investments and, therefore, is not included. - 10 -




---



##### 



NORTEL NETWORKS LONG-TERM INVESTMENT PLAN SCHEDULE OF REPORTABLE TRANSACTIONS (Series of Transactions by Issue in Excess of 5%)
YEAR ENDED DECEMBER 31, 2004  Expense
    
    
    
    
    
    
    Current Value
    
    
    NetPurchase
    
    
    
    
    
    
    Lease
    
    
    Incurred With
    
    
    Cost of
    
    
    of Asset on
    
    
    Gain orIdentity of Party Involved
    
    Description of Asset
    
    Price
    
    
    Selling Price
    
    
    Rental
    
    
    Transaction
    
    
    Asset
    
    
    Transaction Date
    
    
    (Loss)Series of
Transactions:The Northern Trust
    
    Col Tv Short Term Investment Fund
    
    $
    347,888,721
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    347,888,721
    
    
    $
    347,888,721
    
    
    $
    Company
    
    (339 sales; 164 purchases)
    
    
    
    
    
    
    349,985,273
    
    
    
    
    
    
    
    
    
    
    
    349,985,273
    
    
    
    349,985,273
    
    
    
    The Northern Trust
    
    Fidelity Low Priced Stock Fund
    
    
    69,158,206
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69,158,206
    
    
    
    69,158,206
    
    
    
    Company
    
    (117 sales; 145 purchases)
    
    
    
    
    
    
    32,896,775
    
    
    
    
    
    
    
    
    
    
    
    17,533,420
    
    
    
    32,896,775
    
    
    
    15,363,355* The Northern Trust
    
    Nortel Networks Corp New Com
    
    
    56,642,269
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    56,642,269
    
    
    
    56,642,269
    
    
    
    Company
    
    (63 sales; 14 purchases)
    
    
    
    
    
    
    170,418,142
    
    
    
    
    
    
    
    
    
    
    
    326,377,190
    
    
    
    170,418,142
    
    
    
    (155,959,048
    )
 
 *
    
    Indicates a party-in-interest. - 11 -