Take Sir Kickbutt, 16th level fighter.
Normally, lets say he attacks at +26/+21/+16/+11 with one weapon (adding in plusses from STR, magic, etc. to the BAB of +16/+11/+6/+1).
Give him TWF, and he can attack with two weapons without too much hassle, and his attacks are +24/+19/+14/+9 with one hand and +24 with his other hand.
This might be written as +24/+24/+19/+14/+9
Give him ITWF, and he gets an extra "2nd tier" attack, and so attacks at +24/+19 with his "off" hand (note that it is not really an "off" hand, since Sir Kickbutt is ambidextrous, but it is the hand that is getting less attacks right now). Now his attacks look like +24/+24/+19/+19/+14/+9.
Give him GTWF, and he gets an extra "3rd tier" attack, and so attacks at +24/+19/+14 with his "off" hand. Now his attacks look like +24/+24/+19/+19/+14/+14/+9.
Alas, he is too low level to be epic, and so cannot yet gain the feat that would give him that extra "4th tier" attack.
So, the -5 mentioned in ITWF is just to indicate that the extra attack is at the "2nd tier" level, not the "1st tier" level. That is why it is not a blanket -5 to all attacks.