Thomas & Betts (TNB) 10-K 2005 FY Annual report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM10-K

(Mark One)
x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2005.
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to             

Commission file number 1-4682

Thomas & Betts Corporation

(Exact name of registrant as specified in its charter)

Tennessee	22-1326940
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
8155 T&B Boulevard Memphis, Tennessee	38125
(Address of principal executive offices)	(Zip Code)

(901) 252-8000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

	Name of Each Exchange
Title of Each Class	on which Registered
Common Stock, $.10 par value	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

     Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes x    No o

     Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes o    No x

     Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes x    No o

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filerx Accelerated filero Non-accelerated filero

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes o    No x

     As of June 30, 2005, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was $1,695,695,454 based on the closing price as reported on the New York Stock Exchange.

     As of February 20, 2006, 61,781,655 shares of the Registrant’s common stock were outstanding.

Documents Incorporated by Reference

     Portions of the definitive Proxy Statement for the Annual Meeting of Shareholders will be filed within 120 days after the end of the fiscal year covered by this report and are incorporated by reference into Part III.

Thomas & Betts Corporation and Subsidiaries

TABLE OF CONTENTS

		Page
	Caution Regarding Forward-Looking Statements		3
PART I
Item 1.	Business		4
Item 1A.	Risk Factors		9
Item 1B.	Unresolved Staff Comments		11
Item 2.	Properties		12
Item 3.	Legal Proceedings		13
Item 4.	Submission of Matters to a Vote of Security Holders		15
	Executive Officers of the Registrant		15
PART II
Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities		17
Item 6.	Selected Financial Data		18
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		35
Item 8.	Financial Statements and Supplementary Data		37
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		77
Item 9A.	Controls and Procedures		77
Item 9B.	Other Information		77
PART III
Item 10.	Directors and Executive Officers of the Registrant		78
Item 11.	Executive Compensation		79
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters		79
Item 13.	Certain Relationships and Related Transactions		80
Item 14.	Principal Accountant Fees and Services		80
PART IV
Item 15.	Exhibits and Financial Statement Schedules		80
Signatures			82
EXHIBIT INDEX			E-1
Statement re Computation of Ratio of Earnings to Fixed Charges
Subsidiaries of the Registrant
Consent of KPMG LLP
Certification of Principal Executive Officer
Certification of Principal Financial Officer
Section 1350 Certifications

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CAUTION REGARDING FORWARD-LOOKING STATEMENTS

      This Report includes forward-looking statements regarding Thomas & Betts Corporation that are subject to uncertainties in our operations, business, economic and political environment. Statements that contain words such as “achieve,” “guidance,” “believes,” “expects,” “anticipates,” “intends,” “estimates,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will” or similar expressions are forward-looking statements. These statements are subject to risks and uncertainties, and many factors could affect our future financial condition or results of operations. Accordingly, actual results, performance or achievements may differ materially from those expressed or implied by the forward-looking statements contained in this Report. We undertake no obligation to revise any forward-looking statement included in the Report to reflect any future events or circumstances. For more information regarding our risks, please see Item 1A. Risk Factors. Reference in this Report to “we,” “our,” “us,” “Thomas & Betts” or “the Corporation” refers to Thomas & Betts Corporation and its consolidated subsidiaries.

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PART I

Item 1. BUSINESS

      Thomas & Betts Corporation is a leading designer and manufacturer of electrical connectors and components used in industrial, commercial, communications, and utility markets. We are also a leading producer of commercial heating units and highly engineered steel structures used primarily for utility transmission. We have operations in approximately 20 countries. Manufacturing, marketing and sales activities are concentrated primarily in North America and Europe. We pursue growth through market penetration, new product development, and acquisitions.

      We sell our products

•  through electrical, telephone, cable, and heating, ventilation and air-conditioning distributors;

•  directly to original equipment manufacturers, utilities and certain end-users; and

•  through mass merchandisers, catalog merchandisers and home improvement centers.

      Thomas & Betts was first established in 1898 as a sales agency for electrical wires and raceways, and was incorporated and began manufacturing products in New Jersey in 1917. We were reincorporated in Tennessee in 1996. Our corporate offices are maintained at 8155 T&B Boulevard, Memphis, Tennessee 38125, and the telephone number at that address is901-252-8000.

Available Information

      Our internet address iswww.tnb.com. We will make available free of charge on our Internet website, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports as soon as reasonably practicable after they are electronically filed with, or furnished to, the Securities and Exchange Commission (“SEC”). We will provide electronic or paper copies of our filings free of charge upon request.

General Segment Information

      We classify our products into the following business segments based primarily on product lines. Our segments are:

•  Electrical,

•  Steel Structures, and

•  Heating, Ventilation and Air-Conditioning (“HVAC”).

      The majority of our products, especially those sold in the Electrical segment, have region-specific product standards and are sold mostly in North America or in other regions sharing North American electrical codes. No customer accounted for 10% or more of our consolidated net sales for 2005, 2004, or 2003.

Electrical Segment

      Our Electrical segment’s markets include industrial, commercial, utility and residential construction, renovation, maintenance and repair; project construction; industrial original equipment manufacturers; and communication companies. The segment’s sales are concentrated

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primarily in North America and Europe. The Electrical segment experiences modest seasonal increases in sales during the second and third quarters reflecting the construction season. Net sales for the Electrical segment for the past three years were:

	2005			2004			2003
Segment Sales(in thousands)	$	1,377,338		$	1,253,990		$	1,114,852
Percent of Consolidated Net Sales		81.2	%		82.7	%		84.3	%

      The Electrical segment designs, manufactures and markets thousands of different connectors, components and other products for electrical, utility and communications applications. We have a market-leading position for many of our products. Products in the Electrical segment include:

•  fittings and accessories;

•  fastening products, such as plastic and metallic ties for bundling wire, and flexible tubing;

•  connectors, such as compression and mechanical connectors for high-current power and grounding applications;

•  indoor and outdoor switch and outlet boxes, covers and accessories;

•  floor boxes;

•  metal framing used as structural supports for conduits, cable tray and electrical enclosures;

•  emergency and hazardous lighting;

•  safety switches;

•  underground connectors and switchgear;

•  CATV drop hardware;

•  radio frequency RF connectors;

•  aerial, pole, pedestal and buried splice enclosures;

•  encapsulation and sheath repair systems; and

•  other products, including insulation products, wire markers, and application tooling products.

      These products are sold under a variety of well-known brand names, such as Color Keyed^®, Elastimold^®, Iberville^®, Kindorf^®, Red Dot^®, Sta-Kon^®, Steel City^®, Superstrut^®,Ty-Rap^®, LRC^®, Diamond^®, Kold-N-Klose^® and Snap-N-Seal^®.

      Demand for electrical products follows general economic conditions and is sensitive to activity in construction markets, industrial production levels and spending by utilities for replacements, expansions and efficiency improvements. The segment’s product lines are predominantly sold through major distributor chains, thousands of independent distributors and, to a lesser extent, to retail home centers and hardware outlets. They are also sold directly to original equipment manufacturers, utilities, cable operators, and telecommunications and satellite TV companies. We have strong relationships with our distributors as a result of the breadth and quality of our product lines, our market-leading service programs, our strong history of product innovation, and the high degree of brand-name recognition for our products among end-users.

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Steel Structures Segment

      Our Steel Structures segment designs, manufactures and markets highly engineered tubular steel transmission and distribution poles and lattice steel transmission towers for North American power and telecommunications companies. These products are primarily sold to the following types of end-users:

•  investor-owned utilities;

•  cooperatives, which purchase power from utilities and manage its distribution to end-users; and

•  municipal utilities. 

      These products are marketed primarily under the Meyer^® and Thomas & Betts^® brand names. Net sales for the Steel Structures segment for the past three years were:

	2005			2004			2003
Segment Sales(in thousands)	$	185,995		$	139,633		$	93,534
Percent of Consolidated Net Sales		11.0	%		9.2	%		7.1	%

HVAC Segment

      Our HVAC segment designs, manufactures and markets heating and ventilation products for commercial and industrial buildings. Products in this segment include:

•  gas, oil and electric unit heaters;

•  gas-fired duct furnaces;

•  indirect and direct gas-firedmake-up air;

•  infrared heaters; and

•  evaporative cooling and heat recovery products.

      These products are sold primarily under the Reznor^® brand name through HVAC, mechanical and refrigeration distributors throughout North America and Europe. Demand for HVAC products tends to be higher when customers are experiencing cold weather and, as a result, HVAC has higher sales in the first and fourth quarters. To reduce the impact of seasonality on operations, the segment offers an off-season promotional program with its distributors. Net sales for the HVAC segment for the past three years were:

	2005			2004			2003
Segment Sales(in thousands)	$	132,050		$	122,669		$	113,911
Percent of Consolidated Net Sales		7.8	%		8.1	%		8.6	%

Manufacturing and Distribution

      We employ advanced processes for manufacturing quality products. Our manufacturing processes include high-speed stamping, precision molding, machining, plating and automated assembly. Our internal processes utilize lean manufacturing techniques designed to reduce waste and improve operating efficiencies in our facilities. We also make extensive use of computer-aided design and computer-aided manufacturing (CAD/ CAM) software and equipment to link product engineering with our manufacturing facilities. Additionally, we utilize other advanced

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equipment and techniques in the manufacturing and distribution process, including computer software for scheduling, material requirements planning, shop floor control, capacity planning, and the warehousing and shipment of products.

      Our products have historically enjoyed a reputation for quality in the markets in which they are sold. To ensure maintenance of our quality standards, all of our facilities embrace quality programs, and as of December 31, 2005, approximately 80% meet the ISO 9001 2000 standard. Additionally, we have implemented quality control processes in our design, manufacturing, delivery and other operations in order to further improve product quality and customer service levels.

Raw Materials

      We purchase a wide variety of raw materials for the manufacture of our products including steel, aluminum, zinc, copper, resins and rubber compounds. Sources for raw materials and component parts are well established and, with the exception of steel and certain resins, are sufficiently numerous to avoid serious future interruptions of production in the event that current suppliers are unable to provide raw materials and component parts sufficient to meet our needs. However, we can from time to time encounter manufacturing disruptions in each of our segments from sporadic interruptions by our steel and resins suppliers. In addition, we could encounter price increases that we may not be able to pass on to our customers.

Research and Development

      We have research, development and engineering capabilities in each business segment and maintain facilities that respond to the needs of specific markets. We have a long-term reputation for innovation and value based upon our ability to develop products that meet the needs of the marketplace.

      Research, development and engineering expenditures invested into new and improved products and processes are shown below. These expenses are included in cost of sales in the Consolidated Statements of Operations.

	2005			2004			2003
R&D Expenditures(in thousands)	$	22,928		$	21,630		$	19,568
Percent of Net Sales		1.4	%		1.4	%		1.5	%

Working Capital Practices

      We maintain sufficient inventory to enable us to provide a high level of service to our customers. Our inventory levels, payment terms and return policies are in accordance with general practices associated with the industries in which we operate.

Patents and Trademarks

      We own approximately 1,400 active patent registrations and applications worldwide. We have over 1,400 active trademarks and domain names worldwide, including:Thomas & Betts, T&B, T&B Access, Blackburn, Bowers, Canstrut, Catamount, Color-Keyed, Commander, Deltec, Diamond, DuraGard, Elastimold, Emergi-Lite,E-Z-Code, Flex-Cuf, Furse, Hazlux, Kindorf,Klik-It, Kold-N-Klose, Lehigh, LRC, Marr, Marrette, Meyer, Ocal, Red Dot, Reznor, Russellstoll, Sachs, Shamrock,Shield-Kon,Shrink-Kon, Signature Service, Site Light, Snap-N-Seal,Sta-Kon, Star Teck, Steel City, Superstrut, Taylor,Ty-Fast,Ty-Rap and Union.

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      While we consider our patents, trademarks, and trade dress to be valuable assets, we do not believe that our competitive position is dependent solely on patent or trademark protection or that any business segment or our operations as a whole is dependent on any individual patent or trademark. However, theColor-Keyed, Elastimold, Iberville, Kindorf, Red Dot,Sta-Kon, Steel City,Super-Strut, andTy-Raptrademarks are important to the Electrical segment; theMeyertrademark is important to the Steel Structures segment; and theReznortrademark is important to the HVAC segment. In addition, we do not consider any of our individual licenses, franchises or concessions to be material to our business as a whole or to any business segment.

Competition

      Our ability to continue to meet customer needs by enhancing existing products and developing and manufacturing new products is critical to our prominence in our primary market, the electrical products industry. We have robust competition in all areas of our business, and the methods and levels of competition, such as price, service, warranty and product performance, vary among our markets. While no single company competes with us in all of our product lines, various companies compete with us in one or more product lines. Some of these competitors have substantially greater sales and assets and greater access to capital than we do. We believe Thomas & Betts is among the industry leaders in service to its customers.

      We continually work to enhance our product offerings as do our competitors who are likely to develop new offerings with competitive price and performance characteristics. Although we believe that we have specific technological and other advantages over some of our competitors, because of the intensity of competition in the product areas and geographic markets that we serve, we could experience increased downward pressure on the selling prices for some of our products.

      The abilities of our competitors to enhance their own products, coupled with any unforeseeable changes in customer demand for various products of Thomas & Betts, could affect our overall product mix, pricing, margins, plant utilization levels and asset valuations. We believe that industry consolidation could further increase competitive pressures.

Employees

      As of December 31, 2005, we had approximately 9,000 full-time employees worldwide. Employees of our foreign subsidiaries in the aggregate comprise approximately 50% of all employees. Of the total number of employees, approximately one-third are represented by trade unions. We believe our relationships with our employees and trade unions are good.

Compliance with Environmental Regulations

      We are subject to federal, state, local and foreign environmental laws and regulations that govern the discharge of pollutants into the air, soil and water, as well as the handling and disposal of solid and hazardous wastes. We believe that we are in compliance, in all material respects, with applicable environmental laws and regulations and that the costs of maintaining such compliance with applicable environmental laws and regulations will not be material to our financial position or results of operations.

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Financial Information About Foreign and U.S. Operations

      Export sales originating in the U.S. were approximately $40 million in 2005, $34 million in 2004, and $33 million in 2003. For additional financial information about international and U.S. operations, please refer to Note 14 in the Notes to Consolidated Financial Statements.

Item 1A.     RISK FACTORS

      There are many factors that could pose a material risk to the Corporation’s business, its operating results and financial condition and its ability to execute its business plan, some of which are beyond our control. These factors include, but are not limited to:

Negative economic conditions could have a material adverse effect on our operating results and financial condition.

      We do business in geographically diverse markets. In 2005, approximately 33% of the Corporation’s net sales were generated outside of the United States. The success of Thomas & Betts’ business is directly linked to positive economic conditions in the countries where it sells its products. Material adverse changes in economic (including the potential negative impact of higher interest rates on capital spending in the markets we serve) or industry conditions generally or in the specific markets served by Thomas & Betts could have a material adverse effect on the operating results and financial condition of the Corporation. Additionally, an economic slowdown in the U.S. or in Thomas & Betts’ major foreign markets, including Canada and Europe, could reduce the Corporation’s overall net sales. Because these influences are not always foreseeable, there can be no assurance that the business will not be affected by these occurrences.

A significant reduction in the supply of commodity raw materials could materially disrupt our business and rising costs for commodity raw materials and energy could have a material adverse effect on our profitability.

      In recent years we have experienced rising costs for commodity raw materials (steel, aluminum, zinc, resins and rubber compounds) and energy. Additionally, the impact of increased worldwide demand for steel and the impact in 2005 of domestic hurricane activity on resins have caused the availability of these raw materials to be a concern. If we are unable to obtain the steel and resins as needed to manufacture products, our business could be materially disrupted. The Corporation may also not be able to fully offset in the future the effects of rising costs for commodity raw materials and energy through price increases for its products, productivity improvements or other cost reductions.

Significant changes in customer demand due to increased competition could have a material adverse effect on our operating results and financial condition.

      As Thomas & Betts works to enhance its product offerings, its competitors will most likely continue to improve their products and will likely develop new offerings with competitive price and performance characteristics. Because of the intensity of the competition in the product areas and geographic markets that it serves, Thomas & Betts could experience increased downward pressure on the selling prices for certain of its products.

      Additionally, enhanced product offerings by competitors, coupled with any unforeseeable significant changes in customer demand for various products of Thomas & Betts, could have a material adverse effect on the Corporation’s operating results and financial condition and could impact overall product mix, pricing, margins, plant utilization levels and asset valuations.

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Deterioration in the credit quality of several major customers could have a material adverse effect on our operating results and financial condition.

      A significant asset included in the Corporation’s working capital is accounts receivable from customers. If customers responsible for a significant amount of accounts receivable become insolvent or otherwise unable to pay for products and services, or become unwilling or unable to make payments in a timely manner, the Corporation’s operating results and financial condition could be adversely affected. A significant deterioration in the economy could have an adverse effect on the servicing of these accounts receivable, which could result in longer payment cycles, increased collection costs and defaults in excess of management’s expectations. Although the Corporation is not dependent on any one customer for more than 10% of its sales, deterioration in the credit quality of several major customers at the same time could have a material adverse effect on operating results and financial condition.

Unforeseen adverse regulatory, environmental, monetary and other governmental policies could have a material adverse effect on our profitability.

      Thomas & Betts is subject to governmental regulations throughout the world. Unforeseen changes in these governmental regulations could reduce our profitability. Namely, significant changes in monetary or fiscal policies in the U.S. and abroad could result in currency fluctuations, including fluctuations in the Canadian dollar, Euro and British pound, which, in turn, could have a negative impact on our net sales, costs and expenses. Furthermore, significant changes in any number of governmental policies could create trade restrictions, patent enforcement issues, adverse tax rate changes and changes to tax treatment of items such as tax credits, withholding taxes and transfer pricing. These changes might limit our ability to sell products in certain markets, and could have a material adverse effect on our business, operating results and financial condition.

      In addition, our operations are subject to international, federal, state and local laws and regulations governing environmental matters, including emissions to air, discharge to waters and the generation and handling of waste. Thomas & Betts is also subject to laws relating to occupational health and safety. The operation of manufacturing plants involves a high level of susceptibility in these areas, and there is no assurance that Thomas & Betts will not incur material environmental or occupational health and safety liabilities in the future. Moreover, expectations of remediation expenses could be affected by, and potentially significant expenditures could be required to comply with, environmental regulations and health and safety laws that may be adopted or imposed in the future. Future remediation technology advances could adversely impact expectations of remediation expenses.

The Corporation’s facilities or facilities of its customers could be susceptible to natural disasters.

      The Corporation has operations in approximately 20 countries and sells to customers throughout the world. Should a natural disaster such as a hurricane, tornado, earthquake or flood severely damage a major manufacturing, distribution or headquarters facility of the Corporation, or damage a major facility of one or more of our significant customers, our business could be materially disrupted.

Possible inadequate insurance coverage.

      In accordance with its risk management practices, the Corporation continually reevaluates risks, their potential cost and the cost of minimizing them. To reduce the Corporation’s exposure

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to material risks, in certain circumstances, it purchases insurance. Certain risks are inherent in the manufacturing of the Corporation’s products and the Corporation’s insurance may not be adequate to cover potential claims against it involving its products. The Corporation is also exposed to risks inherent in the packaging and distribution of products. Although the Corporation maintains liability insurance, management cannot assure that the coverage limits under these insurance programs will be adequate to protect Thomas & Betts against future claims, or that the Corporation can and will maintain this insurance on acceptable terms in the future.

Terrorist Acts and Acts of War could adversely impact our business and operating results.

      Terrorist acts and acts of war (wherever located around the world) may cause damage or disruption to our employees, facilities, suppliers, distributors or customers, which could significantly impact our net sales, costs and expenses and financial condition. The potential for future terrorist attacks, the national and international responses to terrorist attacks, and other acts of war or hostility have created many economic and political uncertainties, which could adversely affect our business and results of operations in ways that cannot presently be predicted. In addition, as a global company with headquarters and significant operations located in the United States, we may be impacted by actions against the United States. We are uninsured for losses and interruptions caused by acts of war and have policy limits for losses caused by terrorist acts.

Item 1B.     UNRESOLVED STAFF COMMENTS

      None.

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Item 2. PROPERTIES

      The Corporation has operations in approximately 20 countries and, as of December 31, 2005, occupies approximately 4.8 million sq. ft. of manufacturing space; 1.9 million sq. ft. of office, distribution, storage and warehouse space; and 0.3 million sq. ft. of idle space.

      Our manufacturing locations by segment as of December 31, 2005, were as follows:

		Approximate
		Area in Sq. Ft.
		(000s)
Segment	Location	Leased		Owned
Electrical	Arkansas		—		286
	Massachusetts		—		116
	Mississippi		—		237
	New Jersey		—		134
	New Mexico		—		100
	New York		—		268
	Puerto Rico		68		28
	Tennessee		—		457
	Australia		28		29
	Canada		112		705
	France		—		25
	Germany		30		—
	Hungary		88		—
	Japan		12		—
	Mexico		531		—
	Netherlands		8		39
	United Kingdom		16		125
Steel Structures	Alabama		—		240
	South Carolina		—		105
	Texas		—		136
	Wisconsin		—		171
HVAC	Pennsylvania		—		227
	Belgium		140		—
	France		117		—
	Mexico		214		—

      In addition to the above manufacturing facilities, we own three central distribution centers located in Belgium (0.1 million sq. ft.), Canada (0.3 million sq. ft.) and Byhalia, Mississippi (0.9 million sq. ft.). We also have principal sales offices, warehouses and storage facilities in approximately 0.6 million sq. ft. of space, most of which is leased. Included in this total is

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approximately 0.2 million sq. ft. of leased space in Memphis, Tennessee, which includes our corporate headquarters.

Item 3. LEGAL PROCEEDINGS

Kaiser Litigation

      By July 2000, Kaiser Aluminum, its property insurers, 28 Kaiser injured workers, nearby businesses and a class of 18,000 residents near the Kaiser facility in Louisiana, filed product liability and business interruption cases against the Corporation and six other defendants in Louisiana state court seeking damages in excess of $550 million. These cases alleged that a Thomas & Betts cable tie mounting base failed thereby allowing bundled cables to come in contact with a 13.8 kv energized bus bar. This alleged electrical fault supposedly initiated a series of events culminating in an explosion, which leveled 600 acres of the Kaiser facility. Additionally, the nearby businesses have made demands for unspecified damages, but to date, no discovery has taken place.

      A seven-week trial in the fall 2001 resulted in a jury verdict in favor of the Corporation. However, 13 months later, the trial court overturned that verdict in granting plaintiffs’ judgment notwithstanding the verdict motions. In December 2002, the trial court judge found the Thomas & Betts’ product, an adhesive backed mounting base, to be unreasonably dangerous and therefore assigned 25% fault to T&B. The judge set the damages for an injured worker at $20 million and the damages for Kaiser at $335 million. The judgment did not address damages for nearby businesses or 18,000 residents near the Kaiser facility. The Corporation’s 25% allocation is $88.8 million, plus legal interest. The Corporation has appealed this ruling. Management believes there are meritorious defenses to the claim and intends to contest the litigation vigorously.

      The appeal required a bond in the amount of $104 million (the judgment plus legal interest). Plaintiffs successfully moved the trial court to increase the bond to $156 million. The Corporation’s liability insurers have secured the $156 million bond. The case has been briefed and in January 2006 argued before the Louisiana intermediate appellate court. The Corporation is currently awaiting a decision.

      The Corporation has not reflected a liability in its financial statements for the Kaiser litigation because management believes meritorious defenses exist for this claim and thus management does not believe a loss is probable. Further, until there are new developments in the case that would provide more definitive amounts, management cannot provide any better range of possible losses than zero to the amount of the judgment. When evaluating the impact of the judgment on the Corporation’s liquidity, investors should note that the Corporation has insurance coverage in excess of the judgment.

      In 2004, the Corporation and the class of 18,000 residents reached settlement for claims by the class members. The settlement extinguishes the claims of all class members and includes indemnity of the Corporation against future potential claims asserted by class members or those class members who opted out of the settlement process. Also in 2004, the court approved the class settlement at a fairness hearing. The $3.75 million class settlement amount has been paid directly by an insurer of the Corporation into a trust for the benefit of class members.

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Asbestos Cases

      The Corporation and one subsidiary, Amerace Corporation, acquired in 1995, are subject to asbestos lawsuits in five states, related to either undefined and unidentified or historic products. In all cases, the Corporation is investigating these allegations. Amerace is one of hundreds of defendants and the Corporation is one of dozens of defendants in each case. No asbestos containing product of Amerace or Thomas & Betts has been identified in these cases to date. In the Amerace cases, more than fifty lawsuits have already been dismissed. Potential exposure at this time, if any, cannot be estimated. Management believes, however, that there is no merit to these claims, that damages, if any, are remote and believes that a loss is not probable in any of these cases. Insurance coverage is available in connection with these claims. All asbestos lawsuits involving the Corporation’s subsidiary, L.E. Mason (Red Dot), were dismissed in 2005.

Other Legal Matters

      The Corporation is also involved in legal proceedings and litigation arising in the ordinary course of business. In those cases where we are the defendant, plaintiffs may seek to recover large and sometimes unspecified amounts or other types of relief and some matters may remain unresolved for several years. Such matters may be subject to many uncertainties and outcomes which are not predictable with assurance. We consider the gross probable liability when determining whether to accrue for a loss contingency for a legal matter. We have provided for losses to the extent probable and estimable. The legal matters that have been recorded in our consolidated financial statements are based on gross assessments of expected settlement or expected outcome. Additional losses, even though not anticipated, could have a material adverse effect on our financial position, results of operations or liquidity in any given period.

Environmental Matters

      Owners and operators of sites containing hazardous substances, as well as generators of hazardous substances, are subject to broad and retroactive liability for investigatory and cleanup costs and damages arising out of past disposal activities. Such liability in many cases may be imposed regardless of fault or the legality of the original disposal activity. The Corporation has been notified by the United States Environmental Protection Agency or similar state environmental regulatory agencies or private parties that we, in many instances along with others, may currently be potentially responsible for the remediation of sites pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, similar federal and state environmental statutes, or common law theories. We, along with others, may be held jointly and severally liable for all costs relating to investigation and remediation of 10 sites pursuant to these environmental laws.

      We are the owner or operator, or former owner or operator, of various manufacturing locations that we are currently evaluating for the presence of contamination that may require remediation. These sites include former or inactive facilities or properties in Alabama (Mobile); Connecticut (Monroe); Indiana (Medora); Illinois (Libertyville); Massachusetts (Attleboro, Boston, Canton); New Hampshire (New Milford); New Jersey (Butler, Elizabeth); Pennsylvania (Perkasie, Pittsburgh); Ohio (Bucyrus) and Oklahoma (Stillwater). The sites further include active manufacturing locations in New Jersey (Hackettstown); New Mexico (Albuquerque); South Carolina (Lancaster); and Wisconsin (Hager City).

      Four of these current and former manufacturing locations relate to activities of American Electric for the period prior to our acquisition of that company. These four sites are located in

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Hager City, Wisconsin, Lancaster, South Carolina, Medora, Indiana, and Pittsburgh, Pennsylvania. Each of these sites, except for Pittsburgh is subject to an Asset Purchase Agreement dated June 28, 1985 between American Electric and ITT Corporation. ITT and Thomas & Betts have shared responsibilities and costs at the four outstanding sites subject to this agreement. For certain of the sites covered by this agreement, ITT agreed to indemnify American Electric for environmental liabilities, if any, that occurred prior to the purchase of the facilities by American Electric. We believe that the indemnity of ITT is reliable; however, we have no assurances that these indemnities will be honored.

      In 1996, we acquired Augat Inc. Augat previously evaluated or remediated, and may have liability associated with environmental contamination at a number of sites. Pursuant to a Purchase Agreement, dated July 2, 2000, between the Corporation and Tyco Group S.A.R.L., we agreed to retain certain environmental liabilities, if any, for former Augat manufacturing locations in Alabama (Montgomery Plants 1 & 3); Massachusetts (Mashpee) and South Carolina (Inman); and for five offsite alleged disposal locations.

      In 1998, we acquired Kaufel Group, Ltd. At the time of the acquisition, we discovered potential environmental concerns at two facilities owned and operated by Kaufel in Dorval, Quebec. We evaluated these issues and determined at that time, and we still maintain, that no present action is required in association with potential environmental liability at these sites.

      We have provided for liabilities to the extent probable and estimable, but we are not able to predict the extent of our ultimate liability with respect to all of these pending or future environmental matters. However, we believe that any additional liability with respect to the aforementioned environmental matters will not be material to our financial position or results of operations.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year ended December 31, 2005.

Executive Officers of the Registrant

      The following persons are executive officers of Thomas & Betts, and are elected by and serve at the discretion of the Board of Directors.

Dominic J. Pileggi, 54

Chairman of the Board, President and Chief Executive Officer

      Mr. Pileggi was elected Chief Executive Officer in January 2004, and Chairman of the Board effective January 2006. Mr. Pileggi has held several executive positions with the company, including President and Chief Operating Officer from 2003 to 2004, and Senior Vice President and Group President — Electrical from 2000 to 2003. He also held various executive positions with Thomas & Betts from 1979 to 1995. Mr. Pileggi was employed by Viasystems Group, Inc., as Executive Vice President in 1998 to 2000 and President — EMS Division of Viasystems in 2000.

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Kenneth W. Fluke, 46

Senior Vice President & Chief Financial Officer

      Mr. Fluke was elected Senior Vice President and Chief Financial Officer effective May 2004. Prior to that time, he was Vice President — Controller from 2000. Previously, he held various finance and managerial positions with The Goodyear Tire and Rubber Company beginning in 1982.

Christopher P. Hartmann, 44

President — Electrical Division

      Mr. Hartmann has been President — Electrical Division since 2003 and was elected an executive officer effective May 2004. Prior to that time, he was President and Chief Operating Officer of Affiliated Distributors, North America’s largest network of independent electrical distributors from 1999 to 2002.

J.N. Raines, 62

Vice President — General Counsel & Secretary

      Mr. Raines was elected to the officer position of Vice President — General Counsel & Secretary in 2001. Prior to that time, he was a partner of the law firm of Glankler Brown PLLC for more than five years.

Stanley P. Locke, 46

Vice President — Controller

      Mr. Locke was elected to the position of Vice President — Controller in June 2005. Prior to that time, he was Vice President — Corporate Controller from 2004. Previously, he held various positions in finance and corporate development with Sara Lee Corporation, beginning in 1985, as well as with a consulting advisory firm from 2003 to 2004.

NYSE Certifications

      Our CEO certified to the New York Stock Exchange in 2005 that we were in compliance with the NYSE listing standards. Our CEO and CFO have executed the certification required by section 302 of the Sarbanes-Oxley Act of 2002, which is contained herein as an exhibit to this Form 10-K for the fiscal year ended December 31, 2005.

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PART II

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

      Our common stock is traded on the New York Stock Exchange under the symbol TNB. The following table sets forth by quarter for the last two years the high and low sales prices of our common stock as reported by the NYSE.

      At February 20, 2006, the closing price of the Corporation’s common stock on the NYSE was $49.02.

		2005		2004
First Quarter
	Market price high	$	33.88	$	23.60
	Market price low	$	27.45	$	19.64
Second Quarter
	Market price high	$	33.15	$	27.37
	Market price low	$	27.68	$	21.82
Third Quarter
	Market price high	$	36.00	$	27.22
	Market price low	$	27.94	$	23.19
Fourth Quarter
	Market price high	$	43.34	$	32.47
	Market price low	$	31.95	$	25.87

Holders

      At February 20, 2006, the Corporation had approximately 3,100 shareholders of record, not including shares held in security position listings, or “street name.”

Dividends

      The Corporation does not currently pay cash dividends. Future decisions concerning the payment of cash dividends will depend upon our results of operations, financial condition, capital expenditure plans, terms of credit agreements, and other factors that the Board of Directors may consider relevant.

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Item 6. SELECTED FINANCIAL DATA

Thomas & Betts Corporation and Subsidiaries

		2005		2004		2003		2002			2001
(In thousands, except per share data)
Net sales		$	1,695,383	$	1,516,292	$	1,322,297	$	1,345,857		$	1,497,491
Net earnings (loss) from continuing operations before cumulative effect of an accounting change		$	113,408	$	93,255	$	42,813	$	(8,212	)	$	(138,877	)
Long-term debt including current maturities		$	537,959	$	545,915	$	685,316	$	625,108		$	672,037
Total assets		$	1,920,396	$	1,755,752	$	1,782,625	$	1,619,756		$	1,761,610
Per share earnings (loss) from continuing operations before cumulative effect of an accounting change:
	Basic	$	1.89	$	1.59	$	0.73	$	(0.14	)	$	(2.39	)
	Diluted	$	1.86	$	1.57	$	0.73	$	(0.14	)	$	(2.39	)
Cash dividends declared per common share		$	—	$	—	$	—	$	—		$	0.56

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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Executive Overview

Introduction

      Thomas & Betts Corporation is a leading designer and manufacturer of electrical connectors and components used in industrial, commercial, communications, and utility markets. We are also a leading producer of commercial heating units and highly engineered steel structures used for, among other things, utility transmission. We operate in approximately 20 countries. Manufacturing, marketing and sales activities are concentrated primarily in North America and Europe.

      We have benefited from generally improved conditions in our key end markets. Favorable market conditions and focused business strategies have helped us realize solid sales, earnings and cash flow growth. Our businesses are volume sensitive, and given the competitive nature of our markets, it is essential that we offer a strong value proposition to our customers and continually improve our unit costs and operating efficiencies.

      In addition to favorable market conditions, our sales growth has benefited from our broad portfolio of quality brands and products, excellent customer service, integrated information systems, and by being fast and flexible in meeting customer needs. We have successfully managed volatile and rising prices in key commodity markets and driven earnings growth through higher sales, improved operating efficiencies and disciplined cost control.

      2005 was a successful year for Thomas & Betts, with each of our businesses experiencing strong sales and earnings improvement. Consolidated net sales grew 12% compared to 2004 driven primarily by stronger demand in most of our end markets. The 42% improvement in earnings from operations over 2004 reflects the impact of higher sales volume, improved fixed cost absorption and our success in managing the impact of higher material and energy costs. Cash flow from operating activities was $193 million in 2005 up from $64 million in 2004 reflecting higher operating earnings and a strong focus on working capital management (i.e., receivables, inventory and accounts payable).

      Looking forward, we have a strong business platform to continue to pursue organic growth and the balance sheet flexibility to invest in our businesses and consider selective value-based acquisitions that fit our core strengths.

Critical Accounting Policies

      The preparation of financial statements contained in this report requires the use of estimates and assumptions to determine certain amounts reported as net sales, costs, expenses, assets or liabilities and certain amounts disclosed as contingent assets or liabilities. Actual results may differ from those estimates or assumptions. Our significant accounting policies are described in Note 2 of the Notes to Consolidated Financial Statements. We believe our critical accounting policies include the following:

•  Revenue Recognition: We recognize revenue when finished products are shipped to unaffiliated customers and both title and risks of ownership are transferred. Sales discounts, quantity and price rebates, and allowances are estimated based on contractual commitments and experience and recorded in the period as a reduction of revenue in which the sale is recognized. Quantity rebates are in the form of volume incentive discount plans, which include specific sales volume targets or year-over-year sales volume growth targets for specific customers. Certain distributors can take advantage of price rebates by subsequently reselling the Corporation’s products into targeted construction projects or markets. Following a distributor’s sale of an eligible product, the distributor submits a claim for a price rebate. The Corporation provides additional allowances for bad

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	debts when circumstances dictate. A number of distributors, primarily in the Electrical segment, have the right to return goods under certain circumstances and those returns, which are reasonably estimable, are accrued as a reduction of revenue at the time of shipment. Management analyzes historical returns and allowances, current economic trends and specific customer circumstances when evaluating the adequacy of accounts receivable related reserves and accruals.
•	Inventory Valuation: Inventories are stated at the lower of cost or market. Cost is determined using thefirst-in, first-out (FIFO) method. To ensure inventories are carried at the lower of cost or market, the Corporation periodically evaluates the carrying value of its inventories. The Corporation also periodically performs an evaluation of inventory for excess and obsolete items. Such evaluations are based on management’s judgment and use of estimates. Such estimates incorporate inventory quantities on-hand, aging of the inventory, sales forecasts for particular product groupings, planned dispositions of product lines and overall industry trends.
•	Goodwill and Other Intangible Assets: We follow the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 requires a transitional and annual test of goodwill and indefinite lived assets associated with reporting units for indications of impairment. The Corporation performs its annual impairment assessment in the fourth quarter of each year, unless circumstances dictate more frequent assessments. Under the provisions of SFAS No. 142, each test of goodwill requires the Corporation to determine the fair value of each reporting unit, and compare the fair value to the reporting unit’s carrying amount. To the extent a reporting unit’s carrying amount exceeds its fair value, an indication exists that the reporting unit’s goodwill may be impaired and the Corporation must perform a second more detailed impairment assessment. The second impairment assessment involves allocating the reporting unit’s fair value to all of its recognized and unrecognized assets and liabilities in order to determine the implied fair value of the reporting unit’s goodwill as of the assessment date. The implied fair value of the reporting unit’s goodwill is then compared to the carrying amount of goodwill to quantify an impairment charge as of the assessment date.
•	Long-Lived Assets: We follow the provisions of SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” SFAS No. 144 establishes accounting standards for the impairment of long-lived assets such as property, plant and equipment and intangible assets subject to amortization. For purposes of recognizing and measuring impairment of long-lived assets, the Corporation evaluates assets at the lowest level of identifiable cash flows for associated product groups. The Corporation reviews long-lived assets to be held-and-used for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the undiscounted expected future cash flows over the remaining useful life of the primary asset in the associated product groups is less than the carrying amount of the assets, the assets are considered to be impaired. Impairment losses are measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. When fair values are not available, the Corporation estimates fair value using the expected future cash flows discounted at a rate commensurate with the risks associated with the recovery of the assets. Assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.
•	Pension and Postretirement Benefit Plan Actuarial Assumptions: We follow the provisions of SFAS No. 87, “Employer’s Accounting for Pensions” and SFAS No. 106, “Employer’s Accounting for Postretirement Benefits Other than Pensions.” For purposes of calculating pension and postretirement medical benefit obligations and related costs, the

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	Corporation uses certain actuarial assumptions. Two critical assumptions, the discount rate and the expected return on plan assets, are important elements of expense and/or liability measurement. We evaluate these assumptions annually. Other assumptions include employee demographic factors (retirement patterns, mortality and turnover), rate of compensation increase and the healthcare cost trend rate. See additional information contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations — Qualified Pension Plans.
•	Income Taxes: We use the asset and liability method of accounting for income taxes. This method recognizes the expected future tax consequences of temporary differences between book and tax bases of assets and liabilities and provides a valuation allowance based on a more-likely-than-not criteria. The Corporation has valuation allowances for deferred tax assets primarily associated with operating loss carryforwards, tax credit carryforwards and deferred state income tax assets. Realization of the deferred tax assets is dependent upon the Corporation’s ability to generate sufficient future taxable income and, if necessary, execution of its tax planning strategies. Management believes that it is more-likely-than-not that future taxable income, based on enacted tax law in effect as of December 31, 2005, will be sufficient to realize the recorded deferred tax assets net of existing valuation allowances. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies, which involve estimates and uncertainties, in making this assessment. Tax planning strategies include primarily sales of non-core assets. Projected future taxable income is based on management’s forecast of the operating results of the Corporation. Management periodically reviews such forecasts in comparison with actual results and expected trends. In the event management determines that sufficient future taxable income, in light of tax planning strategies, may not be generated to fully realize net deferred tax assets, the Corporation will increase valuation allowances by a charge to income tax expense in the period of such determination. Likewise, if management determines that future taxable income will be sufficient to utilize state and foreign net operating loss carryforwards and other deferred tax assets, the Corporation will decrease the existing valuation allowance by recording a reduction to income tax expense in the period of such determination.
•	Environmental Costs: Environmental expenditures that relate to current operations are expensed or capitalized, as appropriate. Remediation costs that relate to an existing condition caused by past operations are accrued when it is probable that those costs will be incurred and can be reasonably estimated based on evaluations of current available facts related to each site.

2006 Outlook

      We believe that we will continue to see solid underlying demand in industrial, commercial and utility markets in 2006. Given this, we expect mid-single digit sales growth driven primarily by volume and earnings per diluted share in the range of $2.35 to $2.45 for the full year 2006. Our 2006 outlook assumes an effective tax rate of 29% and includes a charge of approximately $0.06 per diluted share from the adoption of Statement on Financial Accounting Standards (“SFAS”) No. 123(R), “Share-Based Payment.” The key risks we may face in 2006 include continued higher prices and volatility in commodity markets for our raw materials, and the potential negative impact of rising energy costs and higher interest rates on capital spending in the markets we serve.

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Summary of Consolidated Results

		2005						2004						2003
		In			% of Net			In			% of Net			In			% of Net
		Thousands			Sales			Thousands			Sales			Thousands			Sales
Net sales		$	1,695,383			100.0		$	1,516,292			100.0		$	1,322,297			100.0
Cost of sales			1,195,256			70.5			1,085,150			71.6			970,248			73.4
Gross profit			500,127			29.5			431,142			28.4			352,049			26.6
Selling, general and administrative			296,132			17.5			287,024			18.9			282,779			21.4
Other operating expense (income), net			—			—			—			—			(12,325	)		(1.0	)
Earnings from operations			203,995			12.0			144,118			9.5			81,595			6.2
Income from unconsolidated companies			1,377			0.1			2,167			0.1			3,214			0.2
Interest expense, net			(25,214	)		(1.5	)		(30,608	)		(2.0	)		(36,879	)		(2.8	)
Other (expense) income, net			(4,298	)		(0.2	)		(825	)		(0.1	)		(1,772	)		(0.1	)
Gain on sale of equity interest			—			—			12,978			0.9			1,587			0.1
Earnings before income taxes			175,860			10.4			127,830			8.4			47,745			3.6
Income tax provision			62,452	��		3.7			34,575			2.2			4,932			0.4
Net earnings		$	113,408			6.7		$	93,255			6.2		$	42,813			3.2
Per share earnings:
	Basic	$	1.89					$	1.59					$	0.73
	Diluted	$	1.86					$	1.57					$	0.73

Year 2005 Compared with 2004

Overview

      Net sales in 2005 increased from the prior year for the Corporation as a whole and for each of its segments. Net sales increases reflect volume increases primarily in the Electrical and Steel Structures segments and price increases to offset higher material and energy costs. Favorable foreign currency exchange also benefited net sales.

      Earnings from operations in 2005 were up significantly compared to the prior year reflecting higher sales and improved fixed cost absorption (i.e., operating efficiencies).

      Net earnings in 2005 included an income tax charge of $16.4 million related to the repatriation of $200 million in foreign earnings. Net earnings in 2004 included a $13.0 million pre-tax gain related to the sale of a minority interest in a European joint venture.

Net Sales and Gross Profit

      Net sales in 2005 were $1,695.4 million, up $179.1 million, or 11.8%, from 2004. Higher sales volume and price increases to offset higher material and energy costs contributed significantly to the sales improvement. Favorable foreign currency exchange driven primarily by strong Canadian and European currencies against a weaker U.S. dollar accounted for approximately $22 million of the sales increase.

      Gross profit in 2005 was $500.1 million, or 29.5% of net sales, compared to $431.1 million or 28.4% in 2004. This improvement reflects increased sales volumes with our plants benefiting from improved absorption. During 2005, we experienced higher raw material costs compared to

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the prior year period. These higher costs were largely offset through increased selling prices for our products.

Expenses

      Selling, general and administrative (“SG&A”) expense in 2005 was $296.1 million or 17.5% of net sales compared to 18.9% of net sales in the prior year period. This percentage improvement reflects our continued focus on closely managing expenses and the effect of much higher sales than expense growth.

Interest Expense, Net

      Interest expense, net for 2005 decreased $5.4 million from the prior year due primarily to higher interest income. Interest income included in interest expense, net was $12.0 million for 2005 and $4.7 million for 2004. Interest expense of $37.2 million in 2005 and $35.3 million in 2004 reflects the impact of interest rate swap agreements. Interest rate swap agreements resulted in a benefit of $0.4 million in 2005 and $4.9 million in 2004.

Gain on Sale of Equity Interest

      In 2004, we sold a minority interest in a European joint venture for $20.9 million in cash and recognized a pre-tax gain of $13.0 million. Prior to the sale, we recognized, as income from unconsolidated companies, net earnings from this equity interest of $1.3 million during 2004.

Income Taxes

      The income tax provision in 2005 reflected an effective rate of 35.5% of pre-tax income compared to an effective rate in the prior year of 27.0% of pre-tax income. The effective rate for both years reflects benefits from our Puerto Rican manufacturing operations as well as benefits in both years resulting from the favorable completion of tax audits. The Corporation recorded an income tax provision of $16.4 million in the fourth quarter of 2005 as a result of the repatriation of $200 million of foreign earnings pursuant to the American Jobs Creation Act of 2004. No net cash taxes resulted from the repatriation due to the use of net operating losses and foreign tax credits.

      The Corporation utilized $63 million of its federal net operating loss carryforwards in 2005, primarily to offset cash taxes related to the repatriation of foreign earnings. The remaining federal net operating loss carryforwards of $186 million, which have no offsetting valuation allowance, are expected to be utilized in the next two or three years. The $864 million of state net operating losses have been substantially reserved by valuation allowances. Future utilization of state net operating loss carryforwards will depend on how U.S. taxable income is recognized in particular states.

Net Earnings

      Net Earnings were $113.4 million, or $1.89 per basic and $1.86 per diluted share, in 2005 compared to net earnings of $93.3 million, or $1.59 per basic and $1.57 per diluted share, in 2004. Results in 2005 include the previously noted income tax charge of $16.4 million ($0.27 per share) related to the repatriation of foreign earnings. Higher 2005 results reflect increased operating earnings on higher current year sales volumes. Results in 2004 include a $13.0 million pre-tax gain ($0.14 per share) from the sale of a minority interest in a European joint venture.

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Year 2004 Compared with 2003

Overview

      Net sales increased in 2004 over the prior year for the Corporation as a whole and for each of its segments. During 2004, we experienced increased demand for products used by utilities and saw an improvement in demand for industrial electrical products. Although we experienced rising raw material costs (primarily steel) during 2004, these costs were offset through higher selling prices for our products. Favorable foreign currency exchange also benefited net sales.

      Earnings from operations in 2004 were up significantly compared to the prior year period reflecting higher sales and operating efficiency improvements. Earnings from operations in 2004 also reflected the ability to offset higher raw materials costs through higher selling prices for our products. Earnings from operations in 2003 included a pre-tax benefit of $8.9 million for the favorable settlement of a commercial lawsuit and a pre-tax benefit of $3.5 million from insurance proceeds.

      Net earnings in 2004 included a $13.0 million pre-tax gain related to the sale of a minority interest in a European joint venture.

Net Sales and Gross Profit

      Net sales in 2004 were $1,516.3 million, up $194.0 million, or 14.7%, from 2003. This increase reflects material-related price increases, increased demand for products used by utilities, and an increase in demand for industrial electrical products. Net sales were also positively impacted by approximately $37 million from foreign currency exchange driven primarily by strong Canadian and European currencies against a weaker U.S. dollar.

      Gross profit in 2004 was $431.1 million, up $79.1 million, or 22.5%, from 2003. Gross profit as a percent of net sales in 2004 improved 1.8 percentage points from the prior year. This improvement reflects increased sales volumes which provided better fixed cost absorption by our plants. During 2004, we experienced higher raw material costs (primarily steel). These higher costs had a minimal impact on our 2004 earnings, as they were offset through higher selling prices for our products and through operational improvements. Gross profit in 2003 reflected a charge of $3.7 million for the closing of a U.S. satellite distribution center.

Expenses

      Selling, general and administrative (“SG&A”) expense in 2004 as a percent of net sales was reduced 2.5 percentage points from the prior year reflecting much higher sales than expense growth. This improvement reflects higher sales and our continued efforts to reduce and tightly control expenses. SG&A in 2003 includes $3.9 million in expense associated with the planned retirement of our former CEO.

      Other operating expense (income), net for 2003 reflects a benefit of $8.9 million for the favorable settlement of a commercial lawsuit and a $3.5 million benefit from insurance proceeds.

Interest Expense, Net

      Interest expense, net for 2004 decreased $6.3 million from the prior year due primarily to lower debt levels. Interest expense, net in 2003 reflected approximately $5.5 million of incremental interest expense related to $125 million of 7.25% senior unsecured notes issued in May 2003 prior to using the proceeds from that issuance to repay $125 million of 8.25% senior unsecured notes in January 2004. Interest income included in interest expense, net was

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$4.7 million for 2004 and $4.2 million for 2003. Interest expense of $35.3 million in 2004 and $41.1 million in 2003 reflects the impact of interest rate swap agreements. Interest rate swap agreements resulted in a benefit of $4.9 million in 2004 and $6.3 million in 2003.

Gain on Sale of Equity Interest

      In 2004, we sold a minority interest in a European joint venture for $20.9 million in cash and recognized a pre-tax gain of $13.0 million. Prior to the sale, we recognized, as income from unconsolidated companies, net earnings from this equity interest of $1.3 million during 2004.

      In 2003, we sold a minority interest in a Japanese joint venture for $2.3 million in cash and recognized a pre-tax gain of $1.6 million. Prior to the sale, we recognized, as income from unconsolidated companies, a negligible amount of net earnings from this equity interest during 2003.

Income Taxes

      The income tax provision in 2004 reflected an effective rate of 27.0% of pre-tax income compared to an effective rate in the prior year of 10.3% of pre-tax income. The effective rate for both years reflects benefits from our Puerto Rican manufacturing operations as well as benefits in both years resulting from the favorable completion of tax audits ($1.5 million for 2004 and $4.5 million for 2003).

Net Earnings

      Net Earnings were $93.3 million, or $1.59 per basic and $1.57 per diluted share, in 2004 compared to net earnings of $42.8 million, or $0.73 per basic and diluted share, in 2003. Higher 2004 results reflect increased operating earnings on higher current year sales volumes and include a $13.0 million pre-tax gain ($0.14 per share) from the sale of a minority interest in a European joint venture. Results in 2003 include a pre-tax benefit of $8.9 million for the favorable settlement of a commercial lawsuit and a pre-tax benefit of $3.5 million from insurance proceeds.

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Summary of Segment Results

	2005				2004				2003
	In		% of Net		In		% of Net		In		% of Net
Net Sales	Thousands		Sales		Thousands		Sales		Thousands		Sales
Electrical	$	1,377,338		81.2	$	1,253,990		82.7	$	1,114,852		84.3
Steel Structures		185,995		11.0		139,633		9.2		93,534		7.1
HVAC		132,050		7.8		122,669		8.1		113,911		8.6
	$	1,695,383		100.0	$	1,516,292		100.0	$	1,322,297		100.0

	2005				2004				2003
	In		% of Net		In		% of Net		In		% of Net
Segment Earnings	Thousands		Sales		Thousands		Sales		Thousands		Sales
Electrical	$	161,823		11.7	$	120,289		9.6	$	65,433		5.9
Steel Structures		28,998		15.6		15,704		11.2		6,354		6.8
HVAC		14,551		11.0		10,292		8.4		8,226		7.2
	$	205,372		12.1	$	146,285		9.6	$	80,013		6.1

      We evaluate our business segments primarily on the basis of segment earnings. Segment earnings are defined as earnings from continuing operations before interest, taxes and certain other charges.

      Our segment earnings are significantly influenced by the operating performance of our Electrical segment that accounted for more than 75% of our consolidated net sales and consolidated segment earnings during 2005, 2004, and 2003.

Electrical Segment

Year 2005 Compared with 2004

      Electrical segment net sales in 2005 were up $123.3 million, or 9.8%, from 2004. Foreign currency exchange accounted for approximately $21 million of the increase. Higher sales volume from improving industrial, light commercial construction, and utilities markets, and price increases to offset higher material and energy costs contributed significantly to the sales increase.

      Electrical segment earnings in 2005 were up $41.5 million, or 34.5%, from 2004. Higher sales volume, operating efficiencies and our continued ability to offset higher material and energy costs through higher selling prices contributed to the improvement in segment earnings.

Year 2004 Compared with 2003

      Electrical segment net sales in 2004 were up $139.1 million, or 12.5%, from 2003. Foreign currency exchange accounted for approximately $34 million of the increase. Higher net sales were primarily a result of sales price increases related to higher raw material costs, higher sales volumes from increased demand for products used by utilities, and an increase in demand for industrial products.

      Electrical segment earnings in 2004 were up $54.9 million, or 83.9%, from 2003. This significant improvement reflects increased sales volumes, which provided better fixed cost absorption. Higher raw materials costs experienced in 2004 had a minimal impact on current

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year results, as they were offset through higher selling prices for Electrical segment products and through operational improvements.

Other Segments

Year 2005 Compared with 2004

      Net sales in 2005 in our Steel Structures segment were up $46.4 million, or 33.2%, from 2004. The sales increase reflects higher levels of capital investment by U.S. electrical utilities to expand or upgrade regional transmission grids. Steel Structures segment earnings in 2005 were up $13.3 million, or 84.7%, from 2004. This significant improvement reflects increased sales volumes associated with additional manufacturing capacity from a 2005 acquisition and improved operating efficiencies.

      Net sales in 2005 in our HVAC segment were up $9.4 million, or 7.6%, from 2004. Higher net sales reflect sales price increases related to higher raw material costs and higher sales volume. HVAC segment earnings in 2005 were up $4.3 million, or 41.4%, from 2004. This improvement reflects disciplined cost controls, improved operating efficiencies and higher sales.

Year 2004 Compared with 2003

      Net sales in 2004 in our Steel Structures segment were up $46.1 million, or 49.3%, from 2003. Higher net sales reflect strengthening demand by utilities to upgrade or expand regional electrical transmission grids and sales price increases related to higher raw material costs. Steel Structures segment earnings in 2004 were up $9.3 million, or 145.3%, from 2003. This significant improvement reflects increased sales volumes and improved operating efficiencies from operating at near capacity levels.

      Net sales in 2004 in our HVAC segment were up $8.8 million, or 7.7%, from 2003. Higher net sales reflect sales price increases related to higher raw material costs and positive impacts from foreign currency exchange. HVAC segment earnings in 2004 were up $2.1 million, or 25.6%, from 2003. This improvement reflects disciplined cost controls and improved operating efficiencies.

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Liquidity and Capital Resources

      We had cash and cash equivalents of $217 million and $151 million at December 31, 2005 and 2004, respectively. Additionally, the Corporation had marketable securities of $292 million and $187 million at December 31, 2005 and 2004, respectively.

      The following table reflects the primary category totals in our Consolidated Statements of Cash Flows.

	2005			2004			2003
(In thousands)
Net cash provided by (used in) operating activities	$	193,097		$	63,911		$	96,793
Net cash provided by (used in) investing activities		(157,925	)		(38,846	)		(101,002	)
Net cash provided by (used in) financing activities		27,359			(124,430	)		59,152
Effect of exchange-rate changes on cash		3,022			7,679			9,938
Net increase (decrease) in cash and cash equivalents	$	65,553		$	(91,686	)	$	64,881

Operating Activities

      Cash provided by operating activities in 2005 was primarily attributable to net earnings and a continued emphasis on tightly managing working capital, which was partially offset by $28.7 million of funding to certain qualified pension plans that brought those plans up to their accumulated benefit obligation. Cash provided by operating activities in 2004 was primarily attributable to net earnings, which was partially offset by an increase in inventory requirements and $78.2 million of funding to certain qualified pension plans that brought those plans up to their accumulated benefit obligation. The inventory increase during 2004 reflected higher raw material costs as well as planned inventory build to protect customer service levels given the uncertainty in raw material availability, particularly in our Steel Structures segment, and to support higher sales volumes. Cash provided by operating activities for 2003 was primarily attributable to net earnings and reductions in receivables and inventories.

Investing Activities

      In January 2005, we purchased the net operating assets of Southern Monopole and Utilities Company for $16.5 million. Southern Monopole manufactures steel poles used primarily for electrical transmission towers. We sold our minority interest in a European joint venture for $20.9 million in cash in 2004 and sold our minority interest in a Japanese joint venture for $2.3 million in cash in 2003.

      During 2005, we had capital expenditures totaling $36.5 million, compared to $25.4 million in 2004 and $28.7 million in 2003. We expect capital expenditures to be approximately $45 million in 2006, for maintenance spending and the support of our ongoing business plans.

      The Corporation’s marketable securities include primarily auction-rate securities. The interest rates on these securities reset typically monthly to prevailing market rates, but may have longer stated maturities. Periods prior to 2005 reflected auction-rate securities as cash and cash equivalents. Prior periods information was reclassified, including the impacts on cash flows, to conform to the current year presentation.

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Financing Activities

      Cash provided by financing activities in 2005 reflected debt repayments of $7.3 million and stock options exercised of $34.7 million. Cash used in 2004 financing activities reflected debt repayments of $139.1 million and stock options exercised of $14.7 million. Cash provided by 2003 financing activities reflected debt proceeds of $130.6 million and debt repayments of $67.8 million. In May 2003, we issued $125 million of 7.25% senior unsecured notes. Proceeds from the issuance of the notes were used to repay $125 million of 8.25% senior unsecured notes upon maturity in January 2004.

$200 million Credit Agreement

      In 2005, we amended our $175 million committed revolving credit facility with a bank group to increase the borrowing capacity to $200 million and to remove collateral requirements. The amendment also extended the June 2006 maturity date to June 2010.

      The credit agreement contains customary covenants which could restrict the payment of dividends, investments, liens, certain types of additional debt and dispositions of assets if the Corporation fails to maintain its financial covenants and certain minimum levels of total availability under the facility. We have the option, at the time of drawing funds under the facility, of selecting an interest rate based on the London Interbank Offered Rate (LIBOR), the federal funds rate, or the prime rate of the agent bank. The Corporation is in compliance with the following significant financial covenants contained in the $200 million credit facility:

     Fixed Charge Coverage Ratio. The Corporation must maintain a ratio, as defined in the agreement, of no less than 2.50 to 1.00 as of the end of any fiscal quarter through March 31, 2006; 2.75 to 1.00 as of the end of any fiscal quarter ending June 30, 2006 through December 31, 2006; and 3.00 to 1.00 as of the end of any fiscal quarter ending March 31, 2007 and thereafter.

     Leverage Ratio. The Corporation must maintain a ratio, as defined in the agreement, of no greater than 4.00 to 1.00 as of the end of any fiscal quarter through December 31, 2006; 3.75 to 1.00 as of the end of any fiscal quarter ending March 31, 2007 and thereafter.

      At December 31, 2005, outstanding letters of credit, or similar financial instruments that reduce the amount available under the $200 million credit facility totaled $33.1 million. Letters of credit relate primarily to third-party insurance claims processing, existing debt obligations and certain tax incentive programs.

Other Credit Facilities

      In June 2005, we terminated our previous CAD$45 million (approximately US $36 million) committed revolving credit facility with a Canadian bank.

      We have a EUR10 million (approximately US$12 million) committed revolving credit facility with a European bank that has an indefinite maturity. Availability under this facility is EUR10 million (approximately US $12 million) as of December 31, 2005. This credit facility contains standard covenants similar to those contained in the $200 million credit agreement and standard events of default such as covenant default and cross-default.

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Compliance and Availability

      We are in compliance with all covenants or other requirements set forth in our credit facilities. However, if we fail to be in compliance with the financial or other covenants of our credit agreements, then the credit agreements could be terminated, any outstanding borrowings under the agreements could be accelerated and immediately due and we could have difficulty renewing or obtaining credit facilities in the future.

      As of January 31, 2006, the aggregate availability of funds under our credit facilities was approximately $179.4 million, after deducting outstanding letters of credit. Availability is subject to the satisfaction of various covenants and conditions to borrowing. These are back up facilities that have not been utilized and we currently do not expect to utilize these facilities in the foreseeable future.

Credit Ratings

      As of December 31, 2005, we had investment grade credit ratings from Standard & Poor’s, Moody’s Investor Service and Fitch Ratings on our senior unsecured debt. Should these credit ratings drop, repayment under our credit facilities and securities will not be accelerated; however, our credit costs may increase. Similarly, if our credit ratings increase, we may have a decrease in our credit costs. The maturity of the senior unsecured debt securities do not accelerate in the event of a credit downgrade.

Debt Securities

      Thomas & Betts had the following senior unsecured debt securities outstanding as of December 31, 2005:

Issue Date	Amount	Interest Rate			Interest Payable		Maturity Date
January 1996	$150 million(a)		6.50%			January 15 and July 15		January 2006
May 1998	$115 million		6.63%			May 1 and November 1		May 2008
February 1999	$150 million		6.39%			March 1 and September 1		February 2009
May 2003	$125 million		7.25%	(b)		June 1 and December 1		June 2013

(a)  The Corporation paid off $150 million of senior unsecured debt in January 2006 using available cash resources.

(b) We have interest rate swaps associated with only a portion of this underlying debt instrument. See Item 7A. Quantitative and Qualitative Disclosures About Market Risk — Interest Rate Risk.

      The indentures underlying the debt securities contain standard covenants such as restrictions on mergers, liens on certain property, sale-leaseback of certain property and funded debt for certain subsidiaries. The indentures also include standard events of default such as covenant default and cross-acceleration. We are in compliance with all covenants and other requirements set forth in the indentures.

Other

      The Corporation does not currently pay cash dividends. Future decisions concerning the payment of cash dividends on the common stock will depend upon our results of operations,

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financial condition, capital expenditure plans and other factors that the Board of Directors may consider relevant.

      In the short-term we expect to fund expenditures for capital requirements as well as other liquidity needs from a combination of cash generated from operations and existing cash balances. These sources should be sufficient to meet our operating needs in the short-term.

      Over the long-term, we expect to meet our liquidity needs with a combination of cash generated from operations and existing cash balances plus either increased debt or equity issuances. From time to time, we may access the public capital markets if terms, rates and timing are acceptable. We have an effective shelf registration statement that will permit us to issue an aggregate of $325 million of senior unsecured debt securities, common stock and preferred stock.

Off-Balance Sheet Arrangements

      As of December 31, 2005, we did not have any off-balance sheet arrangements.

      Refer to Note 15 in the Notes to Consolidated Financial Statements for information regarding our guarantee and indemnification arrangements.

Contractual Obligations

      The following table reflects our total contractual cash obligations as of December 31, 2005.

						2007		2009
						through		through
	Total		2006(a)			2008		2010		Thereafter
(In millions)
Long-Term Debt Including Current Maturities	$	538.0	$	150.8	(b)	$	116.3	$	151.2	$	119.7
Operating Lease Obligations		59.5		12.8			16.9		12.0		17.8
Total Contractual Cash Obligations	$	597.5	$	163.6		$	133.2	$	163.2	$	137.5

(a)  In addition to the amounts above, we expect contributions to our qualified pension plans to be minimal in 2006.

(b)  The Corporation paid off $150 million of senior unsecured debt in January 2006 using available cash resources.

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Qualified Pension Plans

      We have domestic and foreign qualified pension plans with domestic plans accounting for a substantial portion of total plan liabilities and assets. The following information indicates the funded status for qualified pension plans:

Qualified pension plans with plan assets in excess of accumulated benefit obligations:

	December 31,		December 31,
	2005		2004
(In millions)
Projected benefit obligation	$	348	$	317
Accumulated benefit obligation	$	329	$	293
Fair value of plan assets	$	332	$	295

Qualified pension plans with plan assets less than accumulated benefit obligations:

	December 31,		December 31,
	2005		2004
(In millions)
Projected benefit obligation	$	7	$	8
Accumulated benefit obligation	$	7	$	7
Fair value of plan assets	$	4	$	5

All qualified pension plans:

	December 31,		December 31,
	2005		2004
(In millions)
Projected benefit obligation	$	355	$	325
Accumulated benefit obligation	$	336	$	300
Fair value of plan assets	$	336	$	300

      The following information indicates recognized and unrecognized assets and liabilities associated with our qualified pension plans:

	December 31,			December 31,
	2005			2004
(In millions)
Net projected benefit obligation in excess of plan assets	$	19		$	25
Unrecognized actuarial losses		(95	)		(84	)
Recognized net (asset) liability	$	(76	)	$	(59	)

      To the extent not recovered through actual market returns on plan assets, such unrecognized actuarial losses will unfavorably impact our future earnings from operations by increasing pension expense. Amortization of unrecognized actuarial losses during 2005 was $5 million.

      At December 31, 2005, the Corporation’s major active qualified pension plans were funded up to their accumulated benefit obligation. Our funding to all qualified pension plans was $29 million in 2005, $78 million in 2004 and $6 million in 2003. As a result of funding in 2005 and 2004, we expect required contributions to our qualified pension plans will be minimal in 2006.

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      Our qualified pension plan assets at December 31, 2005 and 2004, were included in the following asset categories:

	Plan Assets
	At December 31,			At December 31,
	2005			2004
Asset Category
Short-term investments		15	%		9	%
Domestic equity securities		32	%		33	%
International equity securities		21	%		14	%
Debt securities		23	%		35	%
Other		9	%		9	%
Total		100	%		100	%

      Pension assets held in short-term investments at December 31, 2005 and 2004, reflect contributions made late in 2005 and 2004 that were not yet invested at year-end based on target allocations. Our plan assets allocation targets as of December 31, 2005 and 2004, are as follows:

	Allocation Targets
	December 31,			December 31,
	2005			2004
Asset Category
Domestic equity securities		34	%		34	%
International equity securities		22	%		22	%
Debt securities		26	%		26	%
Other		18	%		18	%
Total		100	%		100	%

      The financial objectives of our investment policy is to maximize returns in order to minimize contributions and long-term cost of funding pension liabilities, within reasonable and prudent levels of risk and to achieve annualized returns in excess of the policy benchmark. As of December 31, 2005 and 2004, no pension assets were directly invested in Thomas & Betts Corporation common stock.

      The long-term rates of return we use for our qualified pension plans take into account historical investment experience over a multi-year period, as well as, mix of plan asset investment types, market conditions, investment practices of our Retirement Plans Committee, and advice from investment professionals and actuarial advisors. The weighted-average long-term rates of return used to determine net periodic pension cost for all qualified pension plans are as follows:

	2005			2004			2003
Weighted-average long-term rates of return used to determine net periodic pension cost		8.15	%		8.61	%		8.66	%

      Reflected in the rates above are domestic weighted-average long-term rates of return of 8.25% for 2005 and 8.75% for 2004 and 2003.

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      The assumed discount rates we use for our qualified pension plans represent long-term high quality corporate bond rates. Discount rates used to determine net periodic pension cost for all qualified pension plans are as follows:

	2005			2004			2003
Discount rates used to determine net periodic pension cost		5.71	%		5.96	%		6.66	%

      Reflected in the rates above are domestic discount rates of 5.75% in 2005, 6.00% in 2004 and 6.75% in 2003.

      Discount rates used to determine pension benefit obligations as of December 31, 2005 and 2004 for all qualified pension plans were 5.65% and 5.71%, respectively, and reflect domestic discount rates of 5.75% for both years.

      The potential impact on the 2005 net periodic pension cost resulting from a hypothetical one-percentage-point change in the assumed weighted-average long-term rate of return while maintaining a constant discount rate would be approximately $3 million. The potential impact on the 2005 net periodic pension cost resulting from a hypothetical one-percentage-point change in the assumed discount rate while maintaining a constant weighted-average long-term rate of return would be approximately $4 million.

      For additional information regarding our qualified and non-qualified pension plans and post-retirement plans, refer to Note 10 in the Notes to Consolidated Financial Statements.

Credit Risk

      We continually evaluate the credit risk associated with our customers. Credit risk with respect to trade receivables is limited due to the large number of customers comprising our customer base and their dispersion across many different industries and geographic areas. No customer receivable exceeds 10% of total accounts receivable as of December 31, 2005.

Recently Issued Accounting Standards

      In December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which requires that compensation costs relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the fair value of the equity or liability instruments used. The Corporation intends to adopt SFAS No. 123(R) during its first quarter of 2006. The impact of adopting SFAS No. 123(R) is expected to reduce full year 2006 earnings per diluted share by approximately $0.06.

      In November 2004, the FASB issued SFAS No. 151, “Inventory Costs.” SFAS No. 151 indicates that “abnormal” amounts of idle facility expense, freight, handling costs, and wasted materials should be recognized as current-period charges (when actual production defect rates vary significantly from expected rates) and requires the allocation of fixed production overheads to inventory based on the “normal capacity”, as defined, of the production facilities. The Corporation intends to adopt SFAS No. 151 during its first quarter of 2006. The Corporation does not believe the impact of adopting SFAS No. 151 will be material.

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Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk and Financial Instruments

      Thomas & Betts is exposed to market risk from changes in interest rates, raw material prices and foreign exchange rates. At times, we may enter into various derivative instruments to manage certain of these risks. We do not enter into derivative instruments for speculative or trading purposes.

Interest Rate Risk

      We are exposed to the impact of interest rate changes and use a combination of fixed and floating rate debt to manage this exposure. We use interest rate swaps, at certain times, to manage the impact of benchmark interest rate changes on the market value of our borrowings and to lower our overall borrowing costs.

      As of December 31, 2005, the Corporation had outstanding interest rate swap agreements with a notional amount of $81.3 million relating to debt securities maturing June 2013. The interest rate swap agreements effectively convert fixed interest rates associated with its debt securities to floating interest rates based on the London Interbank Offered Rate (“LIBOR”) plus an applicable spread. Under these interest rate swap agreements, we received a fixed rate of 7.25% and paid a weighted average variable rate of 6.90% during 2005.

      As of December 31, 2005, our fixed-to-floating interest rate ratio was 85%/15%. The interest rate swaps qualify for the short-cut method of accounting for a fair value hedge under SFAS No. 133. The amount to be paid or received under the interest rate swap agreements is recorded as a component of net interest expense.

      As of December 31, 2005, the fair value of our long-term debt (including current maturities), estimated using quoted market prices or discounted future cash flows based on our current incremental borrowing rates for similar types of borrowing arrangements, was $557.2 million. At December 31, 2005, the carrying value of long-term debt, including current maturities, was $538.0 million. The potential change in fair value resulting from a hypothetical, one-percentage-point change in interest rates would be approximately $14.9 million as of December 31, 2005.

Commodity Risk

      We are exposed to risk from fluctuations in prices for raw materials (including steel, aluminum, copper, zinc, resins and rubber compounds) that are used to manufacture our products. At times, some of the risk associated with usage of aluminum, copper and zinc is mitigated through the use of futures contracts that fix the price we will pay for a commodity. Outstanding contracts as of December 31, 2005, had a notional amount of $4.6 million and a market value of $4.0 million. These contracts relate to gradually declining percentages of future anticipated raw material requirements for the first half of 2006 for aluminum, copper and zinc. As of December 31, 2005, we had recorded an asset of $4.0 million in prepaid expenses which represented unrealized gains associated with open commodity contracts. A hypothetical 10 percent decrease in underlying commodity market prices would result in an unrealized potential reduction in the market value of the open commodity contracts of $0.9 million.

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Foreign Exchange Risk

      From time to time, we utilize forward foreign exchange contracts for the sale or purchase of foreign currencies (principally European currencies). As of December 31, 2005, we had no outstanding forward sale or purchase contracts related to foreign currencies and during the year experienced no impact frommark-to-market adjustments for forward foreign exchange contracts.

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Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX

Consolidated Financial Statements
	Management’s Responsibility for Financial Statements	38
	Management’s Report on Internal Control Over Financial Reporting	38
	Reports of Independent Registered Public Accounting Firm	39
	Consolidated Statements of Operations for 2005, 2004 and 2003	42
	Consolidated Balance Sheets as of December 31, 2005 and 2004	43
	Consolidated Statements of Cash Flows for 2005, 2004 and 2003	44
	Consolidated Statements of Shareholders’ Equity and Comprehensive Income for 2005, 2004 and 2003	45
	Notes to Consolidated Financial Statements	46
Supplementary Financial Data (Unaudited)		76

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MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL STATEMENTS

      Management is responsible for the preparation of the Corporation’s consolidated financial statements and related information appearing in this report. Management believes that the consolidated financial statements fairly reflect the form and substance of transactions and that the financial statements reasonably present the Corporation’s financial position and results of operations in conformity with generally accepted accounting principles in the United States of America. Management also has included in the Corporation’s financial statements amounts that are based on estimates and judgments which it believes are reasonable under the circumstances.

      The independent registered public accounting firm, KPMG LLP, audits the Corporation’s consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States).

      The Board of Directors of the Corporation has an Audit Committee composed of four non-management Directors. The committee meets periodically with financial management, the internal auditors and the independent registered public accounting firm to review accounting, control, auditing and financial reporting matters.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER

FINANCIAL REPORTING

      Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Under the supervision and with the participation of management, including our principal executive officer and principal financial officer, we conducted an assessment of the effectiveness of our internal control over financial reporting based on the framework inInternal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our assessment under the framework inInternal Control — Integrated Framework,management concluded that our internal control over financial reporting was effective as of December 31, 2005. Management’s assessment of the effectiveness of our internal control over financial reporting as of December 31, 2005 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

Thomas & Betts Corporation:

      We have audited the accompanying consolidated balance sheets of Thomas & Betts Corporation and subsidiaries as of December 31, 2005 and December 31, 2004, and the related consolidated statements of operations, cash flows, and shareholders’ equity and comprehensive income for each of the years in the three-year period ended December 31, 2005. These consolidated financial statements are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

      We conducted our audits in accordance with the 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes 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, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Thomas & Betts Corporation and subsidiaries as of December 31, 2005 and December 31, 2004, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2005, in conformity with U.S. generally accepted accounting principles.

      We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Thomas & Betts Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated February 24, 2006 expressed an unqualified opinion on management’s assessment of, and the effective operation of, internal control over financial reporting.

/s/ KPMG LLP

KPMG LLP

Memphis, Tennessee

February 24, 2006

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

Thomas & Betts Corporation:

      We have audited management’s assessment, included in the accompanying Management’s Report on Internal Control Over Financial Reporting, that Thomas & Betts Corporation and subsidiaries (the Corporation) maintained effective internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Corporation’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management’s assessment and an opinion on the effectiveness of the Company’s internal control over financial reporting based on our audit.

      We conducted our audit in accordance with the 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 effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

      A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

      Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

      In our opinion, management’s assessment that the Corporation maintained effective internal control over financial reporting as of December 31, 2005, is fairly stated, in all material respects, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Also, in our opinion, the Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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      We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Thomas & Betts Corporation and subsidiaries as of December 31, 2005 and 2004, and the related consolidated statements of operations, cash flows, and shareholders’ equity and comprehensive income for each of the years in the three-year period ended December 31, 2005, and our report dated February 24, 2006 expressed an unqualified opinion on those financial statements.

/s/ KPMG LLP

KPMG LLP

Memphis, Tennessee

February 24, 2006

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Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share data)

		2005			2004			2003
Net sales		$	1,695,383		$	1,516,292		$	1,322,297
Cost of sales			1,195,256			1,085,150			970,248
Gross profit			500,127			431,142			352,049
Other expenses:
	Selling, general and administrative		296,132			287,024			282,779
	Other operating expense (income), net		—			—			(12,325	)
Earnings from operations			203,995			144,118			81,595
Income from unconsolidated companies			1,377			2,167			3,214
Interest expense, net			(25,214	)		(30,608	)		(36,879	)
Other (expense) income, net			(4,298	)		(825	)		(1,772	)
Gain on sale of equity interest			—			12,978			1,587
Earnings before income taxes			175,860			127,830			47,745
Income tax provision			62,452			34,575			4,932
Net earnings		$	113,408		$	93,255		$	42,813
Earnings per share:
	Basic	$	1.89		$	1.59		$	0.73
	Diluted	$	1.86		$	1.57		$	0.73
Average shares outstanding:
	Basic		60,054			58,610			58,438
	Diluted		61,065			59,357			58,447

The accompanying Notes are an integral part of these Consolidated Financial Statements.

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Thomas & Betts Corporation and Subsidiaries

Consolidated Balance Sheets

(In thousands)

			December 31, 2005			December 31, 2004
ASSETS
Current Assets
	Cash and cash equivalents		$	216,742		$	151,189
	Marketable securities			292,154			186,528
	Receivables, net of allowances of $76,674 and $68,647			185,391			172,745
	Inventories:
		Finished goods		91,597			106,402
		Work-in-process		29,285			28,947
		Raw materials		77,225			71,809
	Total inventories			198,107			207,158
	Deferred income taxes			40,293			46,874
	Prepaid expenses			17,455			14,401
Total Current Assets				950,142			778,895
Property, plant and equipment:
	Land			15,571			15,261
	Buildings			176,054			171,683
	Machinery and equipment			607,847			608,482
	Construction-in-progress			14,408			10,219
Gross property, plant and equipment				813,880			805,645
	Less accumulated depreciation			(546,854	)		(529,501	)
Net property, plant and equipment				267,026			276,144
Goodwill				462,810			463,264
Investments in unconsolidated companies				115,665			114,922
Deferred income taxes				20,061			33,481
Prepaid pension plan costs				76,187			59,261
Other assets				28,505			29,785
Total Assets			$	1,920,396		$	1,755,752
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
	Current maturities of long-term debt		$	150,804		$	2,830
	Accounts payable			138,060			120,336
	Accrued liabilities			101,672			100,692
	Income taxes payable			13,875			14,551
Total Current Liabilities				404,411			238,409
Long-Term Liabilities
	Long-term debt			387,155			543,085
	Accrued pension plan liability			23,079			20,571
	Other long-term liabilities			53,161			51,968
Contingencies (Note 15)
Shareholders’ Equity
	Common stock			6,109			5,935
	Additional paid-in capital			411,985			366,811
	Retained earnings			643,651			530,243
	Unearned compensation, restricted stock			(2,098	)		(1,811	)
	Accumulated other comprehensive income			(7,057	)		541
Total Shareholders’ Equity				1,052,590			901,719
Total Liabilities and Shareholders’ Equity			$	1,920,396		$	1,755,752

The accompanying Notes are an integral part of these Consolidated Financial Statements.

Page 43 of 83

Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)

			2005			2004			2003
Cash Flows from Operating Activities:
Net earnings			$	113,408		$	93,255		$	42,813
Adjustments:
	Depreciation and amortization			48,404			51,805			50,327
	Amortization of restricted stock			1,923			2,331			3,761
	Undistributed earnings from unconsolidated companies			(1,377	)		(2,167	)		(3,214	)
	Mark-to-market adjustment for derivative instruments			(2,184	)		(691	)		(1,116	)
	(Gain) loss on sale of property, plant and equipment			2,050			(721	)		1,465
	Gain on sale of equity interest			—			(12,978	)		(1,587	)
	Deferred income taxes			28,159			12,523			(10,840	)
	Changes in operating assets and liabilities, net:
		Receivables		(15,440	)		1,282			4,527
		Inventories		11,756			(12,682	)		14,493
		Accounts payable		17,837			3,250			(2,176	)
		Accrued liabilities		3,388			(10,885	)		(4,075	)
		Income taxes payable		(684	)		7,395			(3,680	)
		Funding to qualified pension plans		(28,693	)		(78,187	)		(5,525	)
		Other		14,550			10,381			11,620
Net cash provided by (used in) operating activities				193,097			63,911			96,793
Cash Flows from Investing Activities:
	Purchases of property, plant and equipment			(36,455	)		(25,419	)		(28,681	)
	Purchases of and investment in businesses			(16,526	)		—			—
	Proceeds from sale of property, plant and equipment			720			5,948			1,347
	Proceeds from sale of equity interest			—			20,929			2,338
	Marketable securities acquired			(586,050	)		(550,684	)		(194,241	)
	Proceeds from marketable securities			480,386			510,380			118,235
Net cash provided by (used in) investing activities				(157,925	)		(38,846	)		(101,002	)
Cash Flows from Financing Activities:
	Proceeds from long-term debt and other borrowings			—			—			130,628
	Repayment of long-term debt and other borrowings			(7,291	)		(139,096	)		(67,790	)
	Debt issuance costs on recapitalization			—			—			(3,861	)
	Stock options exercised			34,650			14,666			175
Net cash provided by (used in) financing activities				27,359			(124,430	)		59,152
Effect of exchange-rate changes on cash				3,022			7,679			9,938
	Net increase (decrease) in cash and cash equivalents			65,553			(91,686	)		64,881
	Cash and cash equivalents, beginning of year			151,189			242,875			177,994
	Cash and cash equivalents, end of year		$	216,742		$	151,189		$	242,875
Cash payments for interest			$	37,896		$	44,203		$	48,008
Cash payments for income taxes			$	36,470		$	12,219		$	14,816

The accompanying Notes are an integral part of these Consolidated Financial Statements.

Page 44 of 83

Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Shareholders’ Equity and Comprehensive Income

(In thousands)

															Accumulated
															Other
			Common Stock				Additional								Comprehensive			Comprehensive
							Paid-In			Retained		Restricted			Income			Income
			Shares		Amount		Capital			Earnings		Stock			(Loss)			(Loss)			Total
Balance at December 29, 2002				58,296	$	5,830	$	342,911		$	394,175	$	(2,914	)	$	(115,866	)	$	—		$	624,136
Net income				—		—		—			42,813		—			—			42,813			42,813
	Other comprehensive income (loss):
		Unrealized gain (loss) adjustment on securities net of taxes of $(112)		—		—		—			—		—			—			(208	)		(208	)
		Minimum pension liability net of taxes of $7,695		—		—		—			—		—			—			12,556			12,556
		Cumulative translation adjustment		—		—		—			—		—			—			48,477			48,477
	Other comprehensive income (loss)			—		—		—			—		—			60,825			60,825			—
Comprehensive income				—		—		—			—		—			—			103,638			—
Stock options and incentive awards				179		18		3,027			—		(2,861	)		—			—			184
Redemption of Shareholder Rights Plan				—		—		(292	)		—		—			—			—			(292	)
Amortization of restricted stock				—		—		—			—		3,761			—			—			3,761
Balance at December 31, 2003				58,475	$	5,848	$	345,646		$	436,988	$	(2,014	)	$	(55,041	)	$	—		$	731,427
Net income				—		—		—			93,255		—			—			93,255			93,255
	Other comprehensive income (loss):
		Unrealized gain (loss) adjustment on securities net of taxes of $(23)		—		—		—			—		—			—			(42	)		(42	)
		Minimum pension liability net of taxes of $15,216		—		—		—			—		—			—			27,302			27,302
		Cumulative translation adjustment		—		—		—			—		—			—			28,322			28,322
	Other comprehensive income (loss)			—		—		—			—		—			55,582			55,582			—
Comprehensive income				—		—		—			—		—			—			148,837			—
Stock options and incentive awards				878		87		21,165			—		(2,128	)		—			—			19,124
Amortization of restricted stock				—		—		—			—		2,331			—			—			2,331
Balance at December 31, 2004				59,353	$	5,935	$	366,811		$	530,243	$	(1,811	)	$	541		$	—		$	901,719
Net income				—		—		—			113,408		—			—			113,408			113,408
	Other comprehensive income (loss):
		Unrealized gain (loss) adjustment on securities net of taxes of $(14)		—		—		—			—		—			—			(26	)		(26	)
		Minimum pension liability net of taxes of $256		—		—		—			—		—			—			453			453
		Cumulative translation adjustment		—		—		—			—		—			—			(8,025	)		(8,025	)
	Other comprehensive income (loss)			—		—		—			—		—			(7,598	)		(7,598	)		—
Comprehensive income				—		—		—			—		—			—			105,810			—
Stock options and incentive awards				1,736		174		45,174			—		(2,210	)		—			—			43,138
Amortization of restricted stock				—		—		—			—		1,923			—			—			1,923
Balance at December 31, 2005				61,089	$	6,109	$	411,985		$	643,651	$	(2,098	)	$	(7,057	)	$	—		$	1,052,590

Preferred Stock: Authorized 1,000,000 shares, par value $0.10 per share. None issued.

Common Stock: Authorized 250,000,000 shares, par value $0.10 per share.

The accompanying Notes are an integral part of these Consolidated Financial Statements.

Page 45 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

1. Nature of Operations

      Thomas & Betts Corporation is a leading designer and manufacturer of connectors and components for electrical markets. The Corporation is also a leading producer of highly engineered steel structures used primarily for utility power lines, and industrial heating units. The Corporation has operations in approximately 20 countries. Manufacturing, marketing and sales activities are concentrated primarily in North America and Europe.

      The Corporation sells its products 1) through electrical, telephone, cable, and heating, ventilation and air-conditioning distributors; 2) directly to original equipment manufacturers and certain end-users; and 3) through mass merchandisers, catalog merchandisers and home improvement centers. Thomas & Betts pursues growth through market penetration, new product development, and acquisitions.

2. Summary of Significant Accounting Policies

     Basis of Presentation: The consolidated financial statements include the accounts of the Corporation and its domestic and foreign subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. When appropriate, the Corporation uses the equity method of accounting for its investments in20-to-50-percent-owned companies. Under accounting principles generally accepted in the United States of America (GAAP), there is a presumption that the equity method should be used to account for those investments. If the Corporation were to determine that it no longer had the ability to exercise significant influence over the operating and financial policies of those companies, GAAP would require the Corporation to use the cost method rather than the equity method to account for those investments. The Corporation regularly monitors its relationships with these companies.

      Certain reclassifications have been made to prior periods to conform to the current year presentation.

     Use of Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the applicable reporting period. Actual results could differ from those estimates.

     Cash and Cash Equivalents: Cash equivalents consist of investments with maturities at date of purchase of less than 90 days that have a low risk of change in value due to interest rate fluctuations. Foreign currency cash flows have been converted to U.S. dollars at applicable weighted-average exchange rates or the exchange rates in effect at the time of the cash flows, where determinable.

     Marketable Securities: Investments in marketable securities are stated at fair value. Fair value is determined using quoted market prices and, when appropriate, exchange rates at the end of the applicable reporting period. Unrealized gains and losses on marketable securities classified as available-for-sale are recorded in accumulated other comprehensive income, net of tax. The Corporation’s marketable securities include primarily auction-rate securities. The interest rates on these securities reset typically monthly to prevailing market rates, but may have longer stated maturities. Periods prior to 2005 reflected auction-rate securities as cash and cash equivalents.

Page 46 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

2. Summary of Significant Accounting Policies (Continued)

Prior periods information was reclassified, including the impacts on cash flows, to conform to the current year presentation. See Note 6.

     Revenue Recognition: The Corporation recognizes revenue when finished goods are shipped to unaffiliated customers and both title and the risks of ownership are transferred. Sales discounts, quantity and price rebates, and allowances are estimated based on experience and recorded as a reduction to revenue in the period in which the sale is recognized. Quantity rebates are in the form of volume incentive discount plans which include specific sales volume targets or year-over-year sales volume growth targets for specific customers. Certain distributors can take advantage of price rebates by subsequently reselling the Corporation’s products into targeted construction projects or markets. Following a distributor’s sale of an eligible product, the distributor submits a claim for a price rebate. The Corporation provides additional allowances for bad debts when circumstances dictate. A number of distributors, primarily in the Electrical segment, have a right to return goods under certain circumstances and those returns, which are reasonably estimable, are accrued for at the time of shipment as a reduction to revenue.

     Foreign Currency Translation: Financial statements of international subsidiaries are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities and a weighted-average exchange rate for each period for revenues, expenses, gains and losses. Where the local currency is the functional currency, translation adjustments are recorded as Accumulated Other Comprehensive Income. Where the U.S. dollar is the functional currency, translation adjustments are recorded in income.

     Credit Risk: Credit risk with respect to trade receivables is limited due to the large number of customers comprising the Corporation’s customer base and their dispersion across many different industries and geographic areas.

     Inventories: Inventories are stated at the lower of cost or market. Cost is determined using thefirst-in, first-out (FIFO) method.

     Property, Plant and Equipment: Property, plant and equipment are stated at cost. Expenditures for maintenance and repair are charged to expense as incurred. Major renewals and betterments that significantly extend the lives of assets are capitalized. Depreciation is computed principally on the straight-line method over the estimated useful lives of the assets, which range principally from five to 45 years for buildings, three to 10 years for machinery and equipment, and the lesser of the underlying lease term or 10 years for land and leasehold improvements.

     Goodwill and Other Intangible Assets: Goodwill consists principally of the excess of cost over the fair value of net assets acquired in business combinations accounted for as purchases. Other intangible assets totaling $4.5 million, which are classified as other assets, consist primarily of estimated fair values for trade names and a distributor network, associated with an acquisition. These other intangible assets are considered to have indefinite lives and are not amortized.

      The Corporation follows the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 requires an annual impairment test of goodwill and indefinite lived intangible assets. The Corporation performs its annual impairment assessment in the fourth quarter of each year, unless circumstances dictate more frequent assessments. Under the

Page 47 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

2. Summary of Significant Accounting Policies (Continued)

provisions of SFAS No. 142, each test of goodwill requires the Corporation to determine the fair value of each reporting unit, and compare the fair value to the reporting unit’s carrying amount. To the extent a reporting unit’s carrying amount exceeds its fair value, an indication exists that the reporting unit’s goodwill may be impaired and the Corporation must perform a second more detailed impairment assessment. The second impairment assessment involves allocating the reporting unit’s fair value to all of its recognized and unrecognized assets and liabilities in order to determine the implied fair value of the reporting unit’s goodwill as of the assessment date. The implied fair value of the reporting unit’s goodwill is then compared to the carrying amount of goodwill to quantify an impairment charge as of the assessment date. SFAS No. 142 defines a reporting unit as an operating segment or one level below an operating segment.

      The following table reflects activity for goodwill during the three years ended December 31, 2005:

	Balance				Other —			Balance
	at				Primarily			at
	Beginning		Goodwill		Currency			End
	of Year		Additions		Translation			of Year
(In thousands)
2005
Electrical	$	402,058	$	—	$	(4,593	)	$	397,465
Steel Structures		60,533		4,226		—			64,759
HVAC		673		—		(87	)		586
	$	463,264	$	4,226	$	(4,680	)	$	462,810
2004
Electrical		394,168	$	—	$	7,890		$	402,058
Steel Structures		60,533		—		—			60,533
HVAC		412		197		64			673
	$	455,113	$	197	$	7,954		$	463,264
2003
Electrical	$	376,598	$	—	$	17,570		$	394,168
Steel Structures		60,533		—		—			60,533
HVAC		44		309		59			412
	$	437,175	$	309	$	17,629		$	455,113

     Long-Lived Assets: The Corporation follows the provisions of SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” SFAS No. 144 establishes accounting standards for the impairment of long-lived assets such as property, plant and equipment and intangible assets subject to amortization. For purposes of recognizing and measuring impairment of long-lived assets, the Corporation evaluates assets at the lowest level of identifiable cash flows for associated product groups. The Corporation reviews long-lived assets to be held-and-used for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the undiscounted expected future cash flows over the remaining useful life of the primary asset in the associated product groups is less than the carrying amount of the assets, the assets are considered to be impaired. Impairment losses

Page 48 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

2. Summary of Significant Accounting Policies (Continued)

are measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. When fair values are not available, the Corporation estimates fair value using the expected future cash flows discounted at a rate commensurate with the risks associated with the recovery of the assets. Assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

     Income Taxes: The Corporation uses the asset and liability method of accounting for income taxes. This method recognizes the expected future tax consequences of temporary differences between the book and tax bases of assets and liabilities and provides a valuation allowance based on more-likely-than-not criteria.

     Environmental Costs: Environmental expenditures that relate to current operations are expensed or capitalized, as appropriate. Remediation costs that relate to an existing condition caused by past operations are accrued when it is probable that those costs will be incurred and can be reasonably estimated based on evaluations of currently available facts related to each site.

     Pension and Postretirement Benefit Plans: The Corporation and its subsidiaries have several defined benefit pension plans covering substantially all employees. The Corporation follows the provisions of SFAS No. 87, “Employer’s Accounting for Pensions,” for the recognition of net periodic pension cost. Those plans generally provide pension benefits that are based on compensation levels and years of service. Minimum annual required contributions to the plans, if any, are based on laws and regulations of the applicable countries.

      The Corporation provides certain health-care and life insurance benefits to certain retired employees. The Corporation follows the provisions of SFAS No. 106, “Employer’s Accounting for Postretirement Benefits Other Than Pensions,” for the recognition of postretirement benefits. The Corporation is recognizing the estimated liability for those benefits over the estimated lives of the individuals covered, and is not pre-funding that liability. All of these plans are essentially closed to new entrants. Plan net gains and losses are amortized over a five-year period.

      The Corporation uses December 31 as the measurement date for its pension and post-retirement plans.

     Derivative Instruments: The Corporation is exposed to market risk from changes in raw material prices, foreign exchange rates and interest rates. At times, the Corporation may enter into various derivative instruments to manage certain of these risks. The Corporation does not enter into derivative instruments for speculative or trading purposes. The Corporation’s derivative instruments associated with foreign currencies and commodities have not previously been designated as hedging instruments and do not qualify for hedge accounting treatment and are therefore marked to market each period. Interest rate swaps qualify for the short-cut method of accounting for a fair value hedge under SFAS No. 133. See Note 7.

     Earnings Per Share: Basic earnings per share are computed by dividing net earnings (loss) by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings per share are computed by dividing net earnings by the sum of (1) the weighted-average number of shares of common stock outstanding during the period and (2) the dilutive

Page 49 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

2. Summary of Significant Accounting Policies (Continued)

effect of the assumed exercise of stock options and vesting of restricted stock, using the treasury stock method.

     Stock Options: At December 31, 2005, the Corporation had stock option plans that provide for the purchase of the Corporation’s common stock by its key employees and non-employee directors, which are described more fully in Note 9. The Corporation applies the intrinsic-value-based method of accounting prescribed by Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations including FASB Interpretation No. 44, “Accounting for Certain Transactions involving Stock Compensation,” an interpretation of APB Opinion No. 25, issued in March 2000, to account for its fixed-plan stock options. Under this method, compensation expense is recorded on the date of grant only if the current market price of the underlying stock exceeds the exercise price. SFAS No. 123, “Accounting for Stock-Based Compensation,” and SFAS No. 148, “Accounting for Stock-Based Compensation — Transition and Disclosure,” established accounting and disclosure requirements using a fair-value-base method of accounting for stock-based employee compensation plans. As allowed under SFAS No. 123, the Corporation applied the intrinsic-value-based method of accounting described above, and provided only the disclosures required by SFAS No. 123.

      The following table illustrates the effect on net earnings and earnings per share if the Corporation had applied the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation,” to stock-based employee compensation.

			2005			2004			2003
(In thousands, except per share data)
Net earnings, as reported			$	113,408		$	93,255		$	42,813
	Deduct total incremental stock-based compensation expense determined under fair-value-based method for all awards, net of related tax effects(a)			(3,647	)		(4,297	)		(4,991	)
	Proforma net earnings		$	109,761		$	88,958		$	37,822
	Earnings per share:
		Basic — as reported	$	1.89		$	1.59		$	0.73
		Basic — proforma	$	1.83		$	1.52		$	0.65
		Diluted — as reported	$	1.86		$	1.57		$	0.73
		Diluted — proforma	$	1.80		$	1.50		$	0.65

(a)  Does not include restricted stock expense that is already reported in net earnings. See Note 9.

      A valuation using the fair-value-based accounting method has been made for stock options issued in 2005, 2004, and 2003. That valuation was performed using the Black-Scholes option-pricing model.

Page 50 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

2. Summary of Significant Accounting Policies (Continued)

      The Corporation’s options were valued assuming:

	2005			2004			2003
Risk-free interest rate on issuance date		3.75	%		3.00	%		3.00	%
Dividend yield		—	%		—	%		—	%
Volatility		30	%		35	%		35	%
Average expected option life		4 years			4  years			5  years

      The valuation determined a per-share weighted-average fair value for options granted during 2005, 2004, and 2003 of $8.71, $6.49, and $5.96, respectively.

Recently Issued Accounting Standards:

      In December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which requires that compensation costs relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the fair value of the equity or liability instruments used. The Corporation intends to adopt SFAS No. 123(R) during its first quarter of 2006. The impact of adopting SFAS No. 123(R) is expected to reduce full year 2006 earnings per diluted share by approximately $0.06.

      In November 2004, the FASB issued SFAS No. 151, “Inventory Costs.” SFAS No. 151 indicates that “abnormal” amounts of idle facility expense, freight, handling costs, and wasted materials should be recognized as current-period charges (when actual production defect rates vary significantly from expected rates) and requires the allocation of fixed production overheads to inventory based on the “normal capacity”, as defined, of the production facilities. The Corporation intends to adopt SFAS No. 151 during its first quarter of 2006. The Corporation does not believe the impact of adopting SFAS No. 151 will be material.

3. Acquisitions and Divestitures

     2005: The Corporation purchased the net operating assets of Southern Monopole in January 2005 for $16.5 million in cash. Southern Monopole manufactures steel poles used primarily for electrical transmission towers. An allocation of the purchase price to the assets and liabilities acquired has been performed in accordance with SFAS No. 141. Goodwill derived from the purchase price allocation is $4.2 million and has been assigned to the Steel Structures segment.

     2004: The Corporation sold its 49.9% interest in Euromold NV in September 2004 for $20.9 million in cash and recognized a pre-tax gain of $13.0 million. Prior to the sale, the Corporation had recognized net earnings from this equity interest of $1.3 million during 2004.

     2003: The Corporation sold its 50% interest in Fujimold Ltd. in December 2003 for $2.3 million in cash and recognized a pre-tax gain of $1.6 million. Prior to the sale, the Corporation had recognized a negligible amount of net earnings from this equity interest during 2003.

Page 51 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

4. Basic and Diluted Earnings Per Share

      The following is a reconciliation of the basic and diluted earnings per share computations:

		2005		2004		2003
(In thousands, except per share data)
Net earnings		$	113,408	$	93,255	$	42,813
Basic shares:
	Average shares outstanding		60,054		58,610		58,438
	Basic earnings per share	$	1.89	$	1.59	$	0.73
Diluted shares:
	Average shares outstanding		60,054		58,610		58,438
	Additional shares from the assumed exercise of stock options and vesting of restricted stock		1,011		747		9
			61,065		59,357		58,447
	Diluted earnings per share	$	1.86	$	1.57	$	0.73

      The Corporation had stock options that wereout-of-the-money which were excluded because of their anti-dilutive effect. Suchout-of-the-money options were 1,002,000 shares in 2005, 1,769,000 shares in 2004 and 5,535,000 shares of common stock in 2003.

5. Income Taxes

Overview

      During 2005, the Corporation repatriated $200 million in foreign earnings from the excess cash of certain foreign subsidiaries pursuant to the American Jobs Creation Act of 2004. The Corporation recorded a U.S. federal income tax provision of $16.4 million as a result of the repatriation. In addition, the repatriation increased foreign tax credits by a net of $10.5 million, which has been fully offset by an increase in the valuation allowances. No net cash taxes resulted from the repatriation due to the use of net operating losses and foreign tax credits.

      Undistributed earnings of foreign subsidiaries amounted to $93 million at December 31, 2005. These earnings are considered to be indefinitely reinvested, and, accordingly, no provision for U.S. federal or state income taxes has been provided.

      The relationship of domestic and foreign components of earnings (loss) before income taxes is as follows:

	2005		2004		2003
(In thousands)
Domestic(a)(b)	$	74,042	$	72,370	$	(6,334	)
Foreign		101,818		55,460		54,079
	$	175,860	$	127,830	$	47,745

(a) Domestic earnings (loss) before income taxes in 2005, 2004 and 2003 included $36.2 million, $34.2 million and $39.3 million, respectively, of interest expense on indebtedness. The amount of interest expense related to foreign earnings (loss) is negligible.

Page 52 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

5. Income Taxes (Continued)

(b) Domestic earnings before income taxes in 2004 included a $13 million gain on the sale of a minority interest in a European joint venture.

      The components of income tax provision (benefit) on earnings (loss) are as follows:

		2005			2004			2003
(In thousands)
Current
	Federal	$	2,481		$	3,873		$	1,344
	Foreign		32,107			17,406			13,270
	State and local		473			30			(214	)
	Total current provision (benefit)		35,061			21,309			14,400
Deferred
	Domestic		30,405			15,415			(16,451	)
	Foreign		(3,014	)		(2,149	)		6,983
	Total deferred provision (benefit)		27,391			13,266			(9,468	)
		$	62,452		$	34,575		$	4,932

      The reconciliation between the federal statutory tax rate and the Corporation’s effective tax rate on earnings (loss) is as follows:

		2005			2004			2003
Federal statutory tax rate			35.0	%		35.0	%		35.0	%
Increase (reduction) resulting from:
	State tax — net of federal tax benefit		6.7	(a)		(1.1	)		(4.7	)
	Taxes on foreign earnings		(3.6	)		(2.4	)		3.8
	Non-taxable income from Puerto Rico operations		(5.3	)		(5.6	)		(13.3	)
	Expiration of foreign tax credits		—			—			15.4
	Increase in foreign tax credits		(6.0	)(a)		—			—
	Change in valuation allowance		(0.4	)		0.5			(9.7	)
	Tax audits and reassessment of tax exposures		(0.5	)		(1.2	)		(9.4	)
	Jobs ACT Repatriation		9.3			—			—
	Other		0.3			1.8			(6.8	)
Effective tax rate			35.5	%		27.0	%		10.3	%

(a) State tax of 6.7% and foreign tax credits of (6.0)% were fully offset by a change in the valuation allowance, and, as a result, had no net effect on the overall effective tax rate in 2005.

Page 53 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

5. Income Taxes (Continued)

      The components of the Corporation’s net deferred tax asset were:

		December 31,			December 31,
		2005			2004
(In thousands)
Deferred tax assets
	Tax credit and loss carryforwards	$	162,239		$	184,711
	Accrued employee benefits		9,880			10,433
	Accounts receivable		8,286			7,611
	Self insurance liability		5,351			4,647
	Inventory		4,932			5,164
	Environmental liabilities		3,772			4,373
	Other		6,000			5,029
	Total deferred tax assets		200,460			221,968
	Valuation allowance		(83,330	)		(83,935	)
	Net deferred tax assets		117,130			138,033
Deferred tax liabilities
	Property, plant and equipment		(9,310	)		(12,409	)
	Investments and foreign liabilities		(35,365	)		(36,367	)
	Pension benefits and SEIP		(12,101	)		(8,902	)
	Total deferred tax liabilities		(56,776	)		(57,678	)
	Net deferred tax assets	$	60,354		$	80,355

      A detail of net deferred tax assets associated with tax credits and loss carryforwards is as follows:

		December 31,		Expiration
		2005		Dates
(In thousands)
Tax credit and loss carryforwards
	U.S. federal net operating loss carryforwards	$	65,011		2024
	U.S. state net operating loss carryforwards		51,775		2024
	U.S. foreign tax credits		15,425		2015
	U.S. state income tax credits		9,960		2019
	Foreign net operating loss carryforwards with no expiration dates		5,872		—
	Foreign net operating loss carryforwards		3,307		2015
	U.S. other		10,889		2019
	Total tax credit and loss carryforwards	$	162,239

      There is no valuation allowance on the $65 million U.S. federal net operating loss deferred tax asset as of December 31, 2005. The majority of the $83 million valuation allowance as of December 31, 2005, related to U.S. state net operating loss carryforwards and state income tax credits.

Page 54 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

5. Income Taxes (Continued)

      The gross amount of net operating loss carryforwards are $1.1 billion. The loss carryforwards are composed of $864 million of U.S. state net operating loss carryforwards, $186 million of U.S. federal net operating loss carryforwards and $30 million of foreign net operating loss carryforwards.

Valuation Allowances

      Realization of the deferred tax assets is dependent upon the Corporation’s ability to generate sufficient future taxable income and, if necessary, execution of its tax planning strategies. Management believes that it is more-likely-than-not that future taxable income and tax planning strategies, based on tax laws in effect as of December 31, 2005, will be sufficient to realize the recorded deferred tax assets, net of the existing valuation allowance at December 31, 2005. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Management has identified certain tax planning strategies that it could utilize to avoid the loss carryforward expiring prior to their realization. These tax planning strategies include primarily sales of non-core assets. Projected future taxable income is based on management’s forecast of the operating results of the Corporation, and there can be no assurance that such results will be achieved. Management periodically reviews such forecasts in comparison with actual results and expected trends. In the event management determines that sufficient future taxable income, in light of tax planning strategies, may not be generated to fully realize the net deferred tax assets, the Corporation will increase the valuation allowance by a charge to income tax expense in the period of such determination. Additionally, if events change in subsequent periods which indicate that a previously recorded valuation allowance is no longer needed, the Corporation will decrease the valuation allowance by providing an income tax benefit in the period of such determination.

6. Fair Value of Financial Instruments

      The Corporation’s financial instruments include cash and cash equivalents, marketable securities, long-term debt and interest rate swap agreements. At certain times, the Corporation’s financial instruments include commodity contracts, foreign currency contracts and short-term borrowings. The carrying amounts of those financial instruments generally approximated their fair values at December 31, 2005 and 2004, except that, based on the borrowing rates available to the Corporation under current market conditions, the fair value of long-term debt (including current maturities) was approximately $557.2 million at December 31, 2005 and $580.9 million at December 31, 2004. See Note 8.

Page 55 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

6. Fair Value of Financial Instruments (Continued)

      The cost bases and fair market values of available-for-sale financial instruments at December 31, 2005 and 2004 were:

		Amortized		Gross		Gross		Fair
		Cost		Unrealized		Unrealized		Market
		Basis		Gains		Losses		Value
(In thousands)
As of December 31, 2005
	Auction-rate securities	$	291,550	$	—	$	—	$	291,550
	Mortgage-backed securities		583		21		—		604
		$	292,133	$	21	$	—	$	292,154
As of December 31, 2004
	Auction-rate securities	$	184,870	$	—	$	—	$	184,870
	Mortgage-backed securities		1,597		61		—		1,658
		$	186,467	$	61	$	—	$	186,528

      The mortgage-backed securities held at December 31, 2005, had contractual maturities ranging from one to approximately four years. The Corporation did not realize any significant gains or losses on its marketable securities during 2005, 2004 or 2003.

7. Derivative Instruments

      The Corporation is exposed to market risk from changes in raw material prices, foreign-exchange rates, and interest rates. At times, the Corporation may enter into various derivative instruments to manage certain of those risks. The Corporation does not enter into derivative instruments for speculative or trading purposes.

Commodities Futures Contracts

      The Corporation is exposed to risk from fluctuating prices for certain materials used to manufacture its products, such as: steel, aluminum, copper, zinc, resins and rubber compounds. At times, some of the risk associated with usage of aluminum, copper and zinc is mitigated through the use of futures contracts that fix the price the Corporation will pay for a commodity. Commodities futures contracts utilized by the Corporation have not previously been designated as hedging instruments and do not qualify for hedge accounting treatment under the provisions of SFAS No. 133 and SFAS No. 138.Mark-to-market gains and losses for commodities futures, if any, are recorded in cost of sales. As of December 31, 2005, the Corporation had outstanding commodities futures contracts with a notional amount of $4.6 million and a market value which is recorded in prepaid expenses of $4.0 million. As of December 31, 2004, the Corporation had outstanding commodities futures contracts with a notional amount of $16.6 million and a market value which is recorded in prepaid expenses of $1.8 million. Cost of sales reflects gains of $2.2 million for 2005, $0.7 million for 2004, and $1.1 million for 2003, related tomark-to-market adjustments for commodities futures contracts.

Page 56 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

7. Derivative Instruments (Continued)

Forward Foreign Exchange Contracts

      From time to time, the Corporation utilizes forward foreign exchange contracts for the sale or purchase of foreign currencies (principally European currencies). Forward foreign exchange contracts utilized by the Corporation have not previously been designated as hedging instruments and do not qualify for hedge accounting treatment under the provisions of SFAS No. 133 and SFAS No. 138.Mark-to-market gains and losses for forward foreign exchange contracts are recorded in other (expense) income, net. The Corporation had no outstanding forward sale or purchase contracts as of December 31, 2005 and December 2004. For 2005, 2004, and 2003 the Corporation had nomark-to-market adjustments for forward foreign exchange contracts.

Interest Rate Swap Agreements

      At times, the Corporation enters into interest rate swap agreements. As of December 31, 2005, the Corporation had outstanding interest rate swap agreements with a notional amount of $81.3 million relating to debt securities maturing June 2013. The interest rate swap agreements effectively convert fixed interest rates associated with its debt securities to floating interest rates based on the London Interbank Offered Rate (“LIBOR”) plus an applicable spread.

      The interest rate swaps qualify for the short-cut method of accounting for a fair value hedge under SFAS No. 133. The amount to be paid or received under the interest rate swap agreements is recorded as a component of net interest expense.

      At December 31, 2005, the netout-of-the-money fair value of the interest rate swaps was $5.0 million, which is comprised of $5.0 million classified in other long-term liabilities with an offsetting $5.0 million net decrease in the book value of the debt hedged. At December 31, 2004, the netout-of-the-money fair value of the interest rate swaps was $4.0 million, which is comprised of $4.0 million classified in other long-term liabilities with an off-setting $4.0 million net decrease in the book value of the debt hedged. Net interest expense reflects a benefit associated with these interest rate swap agreements of $0.4 million for 2005, $4.9 million for 2004, and $6.3 million for 2003.

Page 57 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

8. Debt

      The Corporation’s long-term debt at December 31, 2005 and 2004 was:

		December 31,		December 31,
		2005		2004
(In thousands)
Unsecured notes
	6.50% Notes due 2006(a)	$	150,035	$	150,980
	7.25% Notes due 2013(b)		119,988		121,303
Unsecured medium-term notes
	6.63% Notes due 2008		114,684		114,787
	6.39% Notes due 2009		149,835		149,919
Industrial revenue bonds			—		4,880
Other, including capital leases			3,417		4,046
Long-term debt (including current maturities)			537,959		545,915
Less current portion			150,804		2,830
Long-term debt		$	387,155	$	543,085

(a)	Paid in January 2006 from available cash resources.
(b)	See Note 7 regarding interest rate swap agreements.

      Principal payments due on long-term debt including capital leases in each of the five years subsequent to December 31, 2005 are $150.8 million, $0.6 million, $115.7 million, $150.7 million and $0.5 million, respectively.

      In June 2005, the Corporation amended its $175 million committed revolving credit facility with a bank group to increase the borrowing capacity to $200 million and to remove collateral requirements and eliminate restrictions on certain types of transactions. The amendment also extended the previous June 2006 maturity date to June 2010. The Corporation pays an annual commitment fee of 20.0 basis points to maintain this facility. The credit agreement contains customary covenants which could restrict the payment of dividends, investments, liens, certain types of additional debt and dispositions of assets if the Corporation fails to maintain its financial covenants and certain minimum levels of total availability under the facility. No borrowings were outstanding under this facility as of December 31, 2005. Any borrowings outstanding as of June 2010 would mature on that date.

      Outstanding letters of credit which reduced availability under the credit facility, amounted to $33.1 million at December 31, 2005. The letters of credit relate primarily to third-party insurance claims processing, existing debt obligations and certain tax incentive programs.

      Also in June 2005, the Corporation terminated its previous CAD$45 million (approximately US $36 million) committed revolving credit facility with a Canadian bank.

      The Corporation has a EUR10 million (approximately US$12 million) committed revolving credit facility with a European bank. The Corporation pays an annual unused commitment fee of

Page 58 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

8. Debt (Continued)

25.0 basis points on the undrawn balance to maintain this facility. This facility has an indefinite maturity and no borrowings were outstanding as of December 31, 2005.

      As of December 31, 2005, the Corporation’s aggregate availability of funds under its credit facilities is approximately $178.8 million, after deducting outstanding letters of credit. The Corporation has the option, at the time of drawing funds under any of the credit facilities, of selecting an interest rate based on a number of benchmarks including LIBOR, the federal funds rate, or the prime rate of the agent bank.

      Interest expense-net in the accompanying statements of operations includes interest income of $12.0 million in 2005, $4.7 million in 2004 and $4.2 million in 2003.

9. Stock Option and Incentive Plans

      As of December 31, 2005, shares totaling 8,478,056 of the Corporation’s common stock were reserved for issuance associated with prior and future grants or awards under its equity compensation plans. As of December 31, 2005, the Corporation has an equity compensation plan for key employees and an equity compensation plan for non-employee directors.

      A summary of the options outstanding at December 31, 2005 follows:

	Options Outstanding
							Options Exercisable
			Weighted-
			Average		Weighted-				Weighted-
			Remaining		Average				Average
	Number		Contractual		Exercise		Number		Exercise
Range of Exercise Prices	Outstanding		Life		Price		Exercisable		Price
$14.88 - $20.00		865,798		6.14 Years	$	17.90		676,453	$	18.20
20.01 -  25.00		1,309,990		6.60 Years		20.94		368,373		21.06
25.01 -  40.00		967,902		6.15 Years		30.64		441,322		31.87
40.01 -  59.56		803,550		1.90 Years		46.40		803,550		46.40
14.88 -  59.56		3,947,240		5.43 Years	$	27.84		2,289,698	$	31.19

Page 59 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

9. Stock Option and Incentive Plans (Continued)

      The following is a summary of the option transactions for the years 2005, 2004 and 2003:

				Average
				Per Share
	Shares			Option Price
Balance at December 29, 2002		5,210,902		$	27.83
Granted		811,816			16.74
Exercised		(9,153	)		19.14
Terminated		(499,351	)		29.69
Balance at December 31, 2003		5,514,214		$	26.03
Granted		965,437			20.55
Exercised		(745,725	)		19.67
Terminated		(480,346	)		29.98
Balance at December 31, 2004		5,253,580		$	25.56
Granted		555,801			29.62
Exercised		(1,652,763	)		20.96
Terminated		(209,378	)		30.15
Balance at December 31, 2005		3,947,240		$	27.84
Exercisable at December 31, 2003		3,127,566		$	30.93
Exercisable at December 31, 2004		3,364,401		$	28.81
Exercisable at December 31, 2005		2,289,698		$	31.19

May 2004 Equity Compensation Plans

      In May 2004, the Corporation’s shareholders approved its Equity Compensation Plan. Under the Equity Compensation Plan, which expires in 2014, unless earlier terminated, the Corporation may grant to key employees options for up to 3,000,000 shares of common stock and restricted stock awards for up to 500,000 shares of common stock. Option grants to purchase common stock for cash have a term not to exceed 10 years and are at a price not less than the fair market value on the grant date. The value of restricted stock awards is recorded as compensation expense over the vesting period. During 2005, the Corporation granted options for 540,529 shares of common stock and restricted stock awards for 74,725 shares of common stock. During 2004, the Corporation granted options for 8,271 shares of common stock and restricted stock awards for 3,504 shares of common stock. For grants under the plan, restricted stock awards vest in three years after the grant date and options to purchase common stock vest in one-third increments beginning on the anniversary of the date of grant.

      In May 2004, the Corporation’s shareholders approved its Non-Employee Directors Equity Plan. Under the Non-Employee Directors Equity Plan, which expires in 2014, unless earlier terminated, the Corporation may grant to non-employee directors options for up to 750,000 shares of common stock, restricted stock awards for up to 100,000 shares of common stock, unrestricted stock awards for up to 100,000 shares of common stock, and stock credits for up to 750,000 shares of common stock. Option grants to purchase common stock for cash have a term not to exceed 10 years and are at a price not less than the fair market value on the grant

Page 60 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

9. Stock Option and Incentive Plans (Continued)

date. During 2005, the Corporation granted options for 15,272 shares of common stock and restricted stock awards for 7,832 shares of common stock. During 2004, the Corporation granted options for 35,040 shares of common stock and restricted stock awards for 9,450 shares of common stock. For grants under the plan, restricted stock awards and options to purchase common stock vest in one year after the grant date. The value of restricted stock awards is expensed at the time of grant. Stock credits are granted for elective or non-elective fee deferrals, as defined, and do not constitute shares of common stock. Stock credits may be distributed in cash or stock, as determined by the Corporation after a director’s retirement date.

Prior Equity Compensation Plans

      Under a previous stock incentive plan, the Corporation granted options for 922,126 shares of common stock and restricted stock awards for 110,599 shares of common stock to key employees during 2004. Restricted stock awards vest in three years after the grant date and options to purchase common stock vest in one-third increments beginning on the anniversary of the date of grant. The value of restricted stock awards is recorded as compensation expense over the vesting period. Option grants to purchase common stock for cash have a term not to exceed 10 years and are at a price not less than the fair market value on the grant date.

      Under a previous stock incentive plan, the Corporation made restricted stock awards for 150 shares of common stock to non-employee directors during 2004. Restricted shares remain restricted during the directors’ terms and the value of the restricted stock awards is expensed at the time of grant.

      Under a previous stock incentive plan, the Corporation’s former CEO was awarded 40,061 shares of unrestricted common stock during 2004. The value of the stock award was expensed as of the award date.

      Upon a change of control, as defined in the Corporation’s plans, the restrictions applicable to restricted shares immediately lapse and all outstanding stock options will become fully vested and immediately exercisable.

Recognized Tax Benefits

      During 2005 and 2004, the Corporation recognized tax benefits of $7.6 million and $3.4 million related to the exercise of stock options and the vesting of restricted stock. Related income tax benefits in 2003 were immaterial. This benefit was credited directly to Additional Paid-In Capital.

Page 61 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

10. Pension and Postretirement Benefits

      The following is information regarding the Corporation’s 2005 and 2004 pension benefit and postretirement benefit obligations:

								Postretirement
		Pension Benefits						Benefits
		2005			2004			2005			2004
(In thousands)
Change in benefit obligation
Benefit obligation at beginning of year		$	347,863		$	315,430		$	17,241		$	16,698
Service cost			10,403			9,268			65			18
Interest cost			20,419			18,442			978			986
Plan participant’s contributions			117			118			—			—
Plan amendments			—			513			—			—
Actuarial loss (gain)			25,483			22,488			3,134			1,312
Foreign-exchange impact			(5,376	)		3,853			—			—
Acquisitions and other			—			3,211			—			—
Settlements			(262	)		—			—			—
Benefits paid			(17,793	)		(25,460	)		(2,007	)		(1,773	)
Benefit obligation — end of year			380,854			347,863			19,411			17,241
Change in plan assets
Fair value of plan assets at beginning of year			300,193			212,396			—			—
Actual return on plan assets			29,110			21,198			—			—
Employer contributions:
	Qualified pension plans		28,693			78,187			—			—
	Non-qualified pension plans		1,419			9,889			—			—
	Postretirement benefit plans		—			—			2,007			1,773
Plan participants’ contributions			117			118			—			—
Foreign-exchange impact			(5,213	)		3,181			—			—
Acquisitions and other			—			684			—			—
Settlements			(262	)		—			—			—
Benefits paid			(17,793	)		(25,460	)		(2,007	)		(1,773	)
Fair value of plan assets — end of year			336,264			300,193			—			—
Funded status:
Benefit obligation in excess of plan assets			44,590			47,670			19,411			17,241
Unrecognized:
	Net transition asset (obligation)		121			121			(5,365	)		(6,131	)
	Prior service gain (cost)		(8,371	)		(10,175	)		1,050			1,454
	Plan net gain (loss)		(98,748	)		(87,873	)		(3,269	)		(533	)
Net amount recognized		$	(62,408	)	$	(50,257	)	$	11,827		$	12,031

Page 62 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

10. Pension and Postretirement Benefits (Continued)

      The Corporation’s recognized pension and postretirement benefits for 2005 and 2004 included the following components:

							Postretirement
	Pension Benefits						Benefits
	2005			2004			2005		2004
(In thousands)
Prepaid benefit cost	$	(76,187	)	$	(59,261	)	$	—	$	—
Accrued benefit liability		23,079			20,571			11,827		12,031
Accumulated other comprehensive income		(5,015	)		(5,725	)		—		—
Intangible asset		(4,285	)		(5,842	)		—		—
Net amount recognized	$	(62,408	)	$	(50,257	)	$	11,827	$	12,031

      The accumulated benefit obligation for all pension plans was $354.3 million at December 31, 2005 and $316.8 million at December 31, 2004.

      Assumed weighted-average rates used in determining the benefit obligations were:

	Pension Benefits					Postretirement Benefits
	December 31,			December 31,		December 31,			December 31,
	2005			2004		2005			2004
Discount rate		5.65	%		5.71%		5.50	%		5.75%
Rate of increase in compensation level		4.40	%		4.39%		—	%		—%

      Reflected in the weighted-average rates above used in determining the benefit obligations are the U.S. discount rates of 5.75% for 2005 and 2004.

      The following information is for pension plans with plan assets in excess of accumulated benefit obligation:

	December 31,		December 31,
	2005		2004
(In thousands)
Projected benefit obligation	$	347,753	$	316,841
Accumulated benefit obligation		328,731		292,447
Fair value of plan assets		331,766		295,497

      The following information is for pension plans with plan assets less than accumulated benefit obligation:

	December 31,		December 31,
	2005		2004
(In thousands)
Projected benefit obligation	$	33,101	$	31,022
Accumulated benefit obligation		25,549		24,347
Fair value of plan assets		4,498		4,696

      The Corporation maintains non-qualified supplemental pension plans covering certain key executives, which provide for benefit payments that exceed the limit for deductibility imposed by

Page 63 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

10.                        Pension and Postretirement Benefits (Continued)

income tax regulations. The benefit obligation related to these unfunded plans was $25.4 million at December 31, 2005 and $23.0 million at December 31, 2004.

      Net periodic cost for the Corporation’s pension and postretirement benefits for 2005, 2004 and 2003 included the following components:

		Pension Benefits									Postretirement Benefits
		2005			2004			2003			2005			2004			2003
(In thousands)
Service cost — benefits earned during the period		$	10,403		$	9,268		$	7,916		$	65		$	18		$	17
Interest cost on projected benefit obligation			20,419			18,442			17,847			978			986			1,025
Expected return on plan assets			(23,683	)		(17,933	)		(16,332	)		—			—			—
Net amortization of unrecognized:
	Transition obligation (asset)		(12	)		(14	)		(32	)		767			767			766
	Prior service cost (gain)		992			1,036			1,087			(224	)		(233	)		(233	)
	Plan net loss (gain)		5,946			3,874			2,902			218			(27	)		(481	)
	Curtailment and settlement loss(a)		1,762			1,916			2,163			—			—			—
Net periodic pension cost		$	15,827		$	16,589		$	15,551		$	1,804		$	1,511		$	1,094

(a)  Curtailment and settlement losses are primarily associated with the retirement of former executive officers.

      The following table reflects the change in the Corporation’s shareholders’ equity and other comprehensive income for minimum pension liabilities:

										Postretirement
	Pension Benefits									Benefits
	2005			2004			2003			2005		2004		2003
(In thousands)
Decrease in minimum liability, net	$	(453	)	$	(27,302	)	$	(12,556	)	$	—	$	—	$	—

      At December 31, 2005, the Corporation’s major active qualified pension plans were funded up to their accumulated benefit obligation. Our funding to all qualified pension plans was $29 million in 2005, $78 million in 2004 and $6 million in 2003. As a result of funding in 2005 and 2004, we expect required contributions to our qualified pension plans will be minimal in 2006.

Page 64 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

10. Pension and Postretirement Benefits (Continued)

      The following pension and postretirement benefit payments, which reflect expected future service, as appropriate, are as follows:

			Post-
	Pension		retirement
	Benefits		Benefits
(In millions)
2006	$	19.1	$	1.9
2007		18.5		1.9
2008		19.5		1.9
2009		20.3		1.9
2010		21.2		1.8
2011 — 2015		132.0		7.9
Total expected benefit payments	$	230.6	$	17.3

      Assumed weighted-average rates used in determining the net periodic pension cost were:

										Postretirement
	Pension Benefits									Benefits
	2005			2004			2003			2005			2004			2003
Discount rate		5.71	%		5.96	%		6.66	%		5.75	%		6.00	%		6.75	%
Rate of increase in compensation level		4.39	%		4.40	%		4.40	%		—	%		—	%		—	%
Expected long-term rate of return on plan assets		8.15	%		8.61	%		8.66	%		—	%		—	%		—	%

      Reflected in the weighted-average rates above used in determining the net periodic benefit cost are the U.S. discount rate of 5.75% for 2005, 6.00% for 2004 and 6.75% for 2003, and the U.S. expected long-term rate of return on plan assets of 8.25% for 2005 and 8.75% for 2004 and 2003.

      Certain actuarial assumptions, such as the assumed discount rate, the long-term rate of return and the assumed health care cost trend rates have an effect on the amounts reported for net periodic pension and postretirement medical benefit expense as well as the respective benefit obligation amounts. The Corporation reviews external data and its own historical trends for health care costs to determine the health care cost trend rates for the postretirement medical benefit plans. The assumed discount rates represent long-term high quality corporate bond rates. The long-term rates of return used by the Corporation take into account historical investment experience over a multi-year period, as well as, mix of plan asset investment types, current market conditions, investment practices of our Retirement Plans Committee, and advice from our actuaries.

Page 65 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

10. Pension and Postretirement Benefits (Continued)

      The assumed health care cost trend rates at December 31, 2005 and 2004 are:

	2005			2004
Health care cost trend rate assumed for next year		11.0	%		10.0	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)		5.0	%		5.0	%
Year that the rate reaches the ultimate trend rate		2012			2010

      Assumed health care cost trend rates have an effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

	1-Percentage-Point		1-Percentage-Point
	Increase		Decrease
(In thousands)
Effect on total of service and interest cost	$	66	$	(57	)
Effect on postretirement benefit obligation		961		(838	)

      The Corporation’s pension plan weighted-average asset allocations at December 31, 2005 and 2004, by asset category are as follows:

	Plan Assets
	At December 31,			At December 31,
	2005			2004
Asset Category
Short-term investments		15	%		9	%
U.S. domestic equity securities		32	%		33	%
International equity securities		21	%		14	%
Debt securities		23	%		35	%
Other		9	%		9	%
Total		100	%		100	%

      The financial objectives of the Corporation’s investment policy are to maximize returns in order to minimize contributions and long-term cost of funding pension liabilities, within reasonable and prudent levels of risk, to match liability growth with the objective of fully funding benefits as they accrue and to achieve annualized returns in excess of the policy benchmark. The Corporation’s asset allocation targets are 34% U.S. domestic equity securities, 22% international equity securities, 26% fixed income and high yield debt securities and 18% other. As of December 31, 2005 and 2004, no pension plan assets were directly invested in Thomas & Betts Corporation common stock.

Other Benefits

      The Corporation sponsors defined contribution plans for its U.S. employees for which the Corporation’s contributions are based on a percentage of employee contributions. The cost of these plans was $3.5 million in 2005, $3.4 million in 2004, and $3.4 million in 2003.

Page 66 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

11. Leases

      The Corporation and its subsidiaries are parties to various leases relating to plants, distribution facilities, office facilities, vehicles and other equipment. Related real estate taxes, insurance and maintenance expenses are normally obligations of the Corporation. Capitalized leases are not significant.

      Future minimum payments under non-cancelable operating leases consisted of the following at December 31, 2005:

	Operating
	Leases
(In thousands)
2006	$	12,775
2007		9,334
2008		7,580
2009		6,213
2010		5,799
Thereafter		17,802
Total minimum operating lease payments	$	59,503

      Rent expense for operating leases was $22.9 million in 2005, $22.0 million in 2004, and $23.4 million in 2003.

12. Other Financial Data

Other Operating Expense (Income), Net

      During 2003, the Corporation recognized a benefit of $8.9 million from the favorable settlement of a commercial lawsuit. Payment for the settlement was received in 2003. The Corporation also recognized $3.5 million of income from insurance proceeds in 2003.

Other Financial Disclosures

      Research, development and engineering expenditures invested in new and improved products and processes were $22.9 million in 2005, $21.6 million in 2004 and $19.6 million in 2003. These expenditures are included in cost of sales.

      The Corporation expenses the cost of advertising as it is incurred. Total advertising expense was $17.5 million in 2005, $16.6 million in 2004 and $16.5 million in 2003.

      Accrued liabilities included salaries, fringe benefits and other compensation of $49.6 million in 2005 and $45.0 million in 2004.

Page 67 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

12.                        Other Financial Data (Continued)

      The following table reflects activity for accounts receivable allowances, sales discounts and allowances, quantity and price rebates, and bad debts during the three years ended December 31, 2005:

	Balance at							Balance at
	Beginning							End
	of Year		Provisions		Deductions			of Year
(In thousands)
2003	$	60,143	$	146,799	$	(151,343	)	$	55,599
2004	$	55,599	$	185,644	$	(172,596	)	$	68,647
2005	$	68,647	$	211,284	$	(203,257	)	$	76,674

Equity Method Investments

      The Corporation conducts portions of its business, in its Electrical segment, through investments in companies accounted for using the equity method. Those companies are primarily engaged in the design, manufacture and selling of components used in assembling, maintaining or repairing electrical systems. Summarized financial information for the Corporation’s equity investees on a combined basis follows:

	2005		2004(a)		2003(b)
(In millions)
Net sales	$	8	$	47	$	60
Gross profit		4		14		19
Net earnings		3		4		6
Current assets		8		7		30
Non-current assets		3		3		15
Current liabilities		1		1		15
Non-current liabilities		—		—		4

(a)	The Corporation sold its 49.9% interest in Euromold NV in September 2004. The information reflected above includes results for the nine months ended September 30, 2004.
(b)	The Corporation sold its 50% interest in Fujimold Ltd. in December 2003. The information reflected above includes a full year of results for 2003.

Cost Method Investment

      In 1994, the Corporation purchased a minority interest (29.1% of the outstanding common stock representing 23.55% of the voting common stock) in Leviton Manufacturing Co., Inc., a leading U.S. manufacturer of wiring devices, for approximately $51 million consisting of cash and common stock. Through 2001, the Corporation accounted for the investment under the equity method. In 2002, the Corporation determined that it no longer had the ability to influence the operating and financial policies of Leviton and, therefore, adopted the cost method of accounting. The carrying value of the investment was approximately $110 million at December 31, 2005 and 2004.

Page 68 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

12. Other Financial Data (Continued)

Comprehensive Income

      The following table summarizes the components of accumulated other comprehensive income, net of taxes.

	December 31,			December 31,
	2005			2004
(In thousands)
Cumulative translation adjustment	$	7,002		$	15,027
Minimum pension liability		(14,072	)		(14,525	)
Valuation allowance — marketable securities		13			39
Accumulated other comprehensive income	$	(7,057	)	$	541

Stock Purchase Rights

      In 2003, the Corporation’s Board of Directors terminated the Shareholders Rights Plan. The rights were redeemed for $0.3 million cash ($0.005 per right) from shareholders of record on October 30, 2003. The payment was recorded as a reduction of paid-in capital.

13. Segment and Other Related Disclosures

      The Corporation has three reportable segments: Electrical, Steel Structures and HVAC. The Electrical segment designs, manufactures and markets thousands of different electrical connectors, components and other products for electrical, utility and communications applications. The Steel Structures segment designs, manufactures and markets tubular steel transmission and distribution poles and lattice steel transmission towers for North American power companies. The HVAC segment designs, manufactures and markets heating and ventilation products for commercial and industrial buildings.

      The Corporation’s reportable segments are based primarily on product lines and represent the primary mode used to assess allocation of resources and performance. The Corporation evaluates its business segments primarily on the basis of segment earnings, with segment earnings defined as earnings from continuing operations before interest, taxes and certain other charges. The Corporation has no material inter-segment sales. General corporate assets not allocated to segments are principally cash, marketable securities and income tax related assets.

Page 69 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

13. Segment and Other Related Disclosures (Continued)

Segment Information

	2005		2004		2003
(In thousands)
Net Sales
Electrical	$	1,377,338	$	1,253,990	$	1,114,852
Steel Structures		185,995		139,633		93,534
HVAC		132,050		122,669		113,911
Total	$	1,695,383	$	1,516,292	$	1,322,297
Segment Earnings
Electrical	$	161,823	$	120,289	$	65,433
Steel Structures		28,998		15,704		6,354
HVAC		14,551		10,292		8,226
Total	$	205,372	$	146,285	$	80,013
Capital Expenditures
Electrical	$	32,042	$	22,263	$	25,929
Steel Structures		3,414		858		1,009
HVAC		999		2,298		1,743
Total	$	36,455	$	25,419	$	28,681
Depreciation and Amortization
Electrical	$	41,262	$	45,183	$	44,149
Steel Structures		3,462		2,951		2,458
HVAC		3,680		3,671		3,720
Total	$	48,404	$	51,805	$	50,327
Total Assets
Electrical	$	1,105,728	$	1,121,585	$	1,090,563
Steel Structures		130,508		116,047		102,263
HVAC		59,547		61,900		61,124
Total	$	1,295,783	$	1,299,532	$	1,253,950

Page 70 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

13. Segment and Other Related Disclosures (Continued)

      The following are reconciliations of the total of reportable segments to the consolidated company:

	2005			2004			2003
(In thousands)
Earnings Before Income Taxes
Total reportable segment earnings	$	205,372		$	146,285		$	80,013
Interest expense, net		(25,214	)		(30,608	)		(36,879	)
Other operating (expense) income, net		—			—			12,325
Other (expense) income, net		(4,298	)		(825	)		(1,772	)
Gain on sale of equity interest		—			12,978			1,587
Certain other adjustments(a)		—			—			(7,529	)
Earnings before income taxes	$	175,860		$	127,830		$	47,745
Total Assets
Total from reportable segments	$	1,295,783		$	1,299,532		$	1,253,950
General corporate		624,613			456,220			528,675
Total	$	1,920,396		$	1,755,752		$	1,782,625

(a) 2003 includes $3.7 million of expenses associated with the closing of a U.S. satellite distribution center and $3.9 million of expenses related to the retirement of the Corporation’s former CEO.

Page 71 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

14. Financial Information Relating to Operations in Different Geographic Areas

      The Corporation conducts business in three principal areas: U.S., Canada and Europe. Net sales are attributed to geographic areas based on location of customer.

	2005		2004		2003
(In thousands)
Net Sales
U.S.	$	1,129,124	$	1,024,232	$	904,450
Canada		321,405		263,090		216,073
Europe		197,766		186,111		165,587
Other foreign countries		47,088		42,859		36,187
Total	$	1,695,383	$	1,516,292	$	1,322,297
Long-lived Assets
U.S.	$	670,071	$	651,261	$	651,655
Canada		116,720		113,896		110,157
Europe		118,177		131,823		108,906
Other foreign countries		29,561		32,579		34,688
Total	$	934,529	$	929,559	$	905,406

15. Contingencies

Legal Proceedings

Kaiser Litigation

      By July 2000, Kaiser Aluminum, its property insurers, 28 Kaiser injured workers, nearby businesses and a class of 18,000 residents near the Kaiser facility in Louisiana, filed product liability and business interruption cases against the Corporation and six other defendants in Louisiana state court seeking damages in excess of $550 million. These cases alleged that a Thomas & Betts cable tie mounting base failed thereby allowing bundled cables to come in contact with a 13.8 kv energized bus bar. This alleged electrical fault supposedly initiated a series of events culminating in an explosion, which leveled 600 acres of the Kaiser facility. Additionally, the nearby businesses have made demands for unspecified damages, but to date, no discovery has taken place.

      A seven-week trial in the fall 2001 resulted in a jury verdict in favor of the Corporation. However, 13 months later, the trial court overturned that verdict in granting plaintiffs’ judgment notwithstanding the verdict motions. In December 2002, the trial court judge found the Thomas & Betts’ product, an adhesive backed mounting base, to be unreasonably dangerous and therefore assigned 25% fault to T&B. The judge set the damages for an injured worker at $20 million and the damages for Kaiser at $335 million. The judgment did not address damages for nearby businesses or 18,000 residents near the Kaiser facility. The Corporation’s 25% allocation is $88.8 million, plus legal interest. The Corporation has appealed this ruling.

Page 72 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

15. Contingencies (Continued)

Management believes there are meritorious defenses to the claim and intends to contest the litigation vigorously.

      The appeal required a bond in the amount of $104 million (the judgment plus legal interest). Plaintiffs successfully moved the trial court to increase the bond to $156 million. The Corporation’s liability insurers have secured the $156 million bond. The case has been briefed and in January 2006 argued before the Louisiana intermediate appellate court. The Corporation is currently awaiting a decision.

      The Corporation has not reflected a liability in its financial statements for the Kaiser litigation because management believes meritorious defenses exist for this claim and thus management does not believe a loss is probable. Further, until there are new developments in the case that would provide more definitive amounts, management cannot provide any better range of possible losses than zero to the amount of the judgment. When evaluating the impact of the judgment on the Corporation’s liquidity, investors should note that the Corporation has insurance coverage in excess of the judgment.

      In 2004, the Corporation and the class of 18,000 residents reached settlement for claims by the class members. The settlement extinguishes the claims of all class members and includes indemnity of the Corporation against future potential claims asserted by class members or those class members who opted out of the settlement process. Also in 2004, the court approved the class settlement at a fairness hearing. The $3.75 million class settlement amount has been paid directly by an insurer of the Corporation into a trust for the benefit of class members.

Asbestos Cases

      The Corporation and one subsidiary, Amerace Corporation, acquired in 1995, are subject to asbestos lawsuits in five states, related to either undefined and unidentified or historic products. In all cases, the Corporation is investigating these allegations. Amerace is one of hundreds of defendants and the Corporation is one of dozens of defendants in each case. No asbestos containing product of Amerace or Thomas & Betts has been identified in these cases to date. In the Amerace cases, more than fifty lawsuits have already been dismissed. Potential exposure at this time, if any, cannot be estimated. Management believes, however, that there is no merit to these claims, that damages, if any, are remote and believes that a loss is not probable in any of these cases. Insurance coverage is available in connection with these claims. All asbestos lawsuits involving the Corporation’s subsidiary, L.E. Mason (Red Dot), were dismissed in 2005.

Other Legal Matters

      The Corporation is also involved in legal proceedings and litigation arising in the ordinary course of business. In those cases where we are the defendant, plaintiffs may seek to recover large and sometimes unspecified amounts or other types of relief and some matters may remain unresolved for several years. Such matters may be subject to many uncertainties and outcomes which are not predictable with assurance. We consider the gross probable liability when determining whether to accrue for a loss contingency for a legal matter. We have provided for losses to the extent probable and estimable. The legal matters that have been recorded in our

Page 73 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

15. Contingencies (Continued)

consolidated financial statements are based on gross assessments of expected settlement or expected outcome. Additional losses, even though not anticipated, could have a material adverse effect on our financial position, results of operations or liquidity in any given period.

Environmental Matters

      Under the requirements of the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, (the “Superfund Act”) and certain other laws, the Corporation is potentially liable for the cost ofclean-up at various contaminated sites identified by the United States Environmental Protection Agency and other agencies. The Corporation has been notified that it is named a potentially responsible party (PRP) at various sites for study andclean-up costs. In some cases there are several named PRPs and in others there are hundreds. The Corporation generally participates in the investigation orclean-up of potentially contaminated sites through cost-sharing agreements with terms which vary from site to site. Costs are typically allocated based upon the volume and nature of the materials sent to the site. However, under the Superfund Act and certain other laws, as a PRP, the Corporation can be held jointly and severally liable for all environmental costs associated with the site.

      When the Corporation becomes aware of a potential liability at a particular site, it conducts studies to estimate the amount of the liability. If determinable, the Corporation accrues what it considers to be the most accurate estimate of its liability at that site, taking into account the other participants involved in the site and their ability to pay. The Corporation has acquired facilities subject to environmental liability where, in one case, the seller has committed to indemnify the Corporation for those liabilities, and, in another, subject to an asset purchase agreement, the seller assumed responsibility for paying its proportionate share of the environmentalclean-up costs.

      The Corporation’s accrual for probable environmental costs was approximately $11 million at December 31, 2005 and $13 million at December 31, 2004. The Corporation is not able to predict the extent of its ultimate liability with respect to all of its pending or future environmental matters. However, the Corporation does not believe that any additional liability with respect to these environmental matters will be material to its financial position, results of operations or liquidity.

Guarantee and Indemnification Arrangements

      The Corporation follows the provisions of FASB Interpretation No. 45,Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others. The Interpretation requires the Corporation to recognize the fair value of guarantee and indemnification arrangements issued or modified by the Corporation, if these arrangements are within the scope of that Interpretation. In addition, under previously existing generally accepted accounting principles, the Corporation continues to monitor the conditions that are subject to the guarantees and indemnifications to identify whether it is probable that a loss has occurred, and would recognize any such losses under the guarantees and indemnifications when those losses are estimable.

Page 74 of 83

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements

15. Contingencies (Continued)

      The Corporation generally warrants its products against certain manufacturing and other defects. These product warranties are provided for specific periods of time and usage of the product depending on the nature of the product, the geographic location of its sale and other factors. The accrued product warranty costs are based primarily on historical experience of actual warranty claims as well as current information on repair costs.

      The following table provides the changes in the Corporation’s accruals for estimated product warranties:

	2005			2004
(In thousands)
Balance at beginning of year	$	1,588		$	1,543
Liabilities accrued for warranties issued during the year		872			842
Deductions for warranty claims paid during the period		(1,313	)		(1,424	)
Changes in liability for pre-existing warranties during the year, including expirations		331			627
Balance at end of year	$	1,478		$	1,588

      In conjunction with the divestiture of the Corporation’s Electronics OEM business to Tyco Group S.A.R.L. in July 2000, the Corporation provided an indemnity to Tyco associated with environmental liabilities that were not known as of the sale date. Under this indemnity, the Corporation is liable for subsequently identified environmental claims up to $2 million. Additionally, the Corporation as of December 31, 2005, is liable for 50% of subsequently identified environmental claims that exceed $2 million and such liability declines to zero in July 2007. To date environmental claims by Tyco have been negligible.

Page 75 of 83

Thomas & Betts Corporation and Subsidiaries

SUPPLEMENTARY FINANCIAL DATA

		2005			2004
(In thousands, except per share data)
		(Unaudited)
First Quarter
Net sales		$	392,186		$	352,988
Gross profit			111,046			99,699
Net earnings			24,408			15,612
Per share net earnings(a)
	Basic		0.41			0.27
	Diluted		0.40			0.27
Second Quarter
Net sales		$	418,090		$	368,973
Gross profit			120,018			107,254
Net earnings			28,393			19,969
Per share net earnings(a)
	Basic		0.47			0.34
	Diluted		0.47			0.34
Third Quarter
Net sales		$	442,071		$	394,211
Gross profit			134,513			109,974
Net earnings			34,838			33,428	(c)
Per share net earnings(a)
	Basic		0.58			0.57	(c)
	Diluted		0.57			0.56	(c)
Fourth Quarter
Net sales		$	443,036		$	400,120
Gross profit			134,550			114,215
Net earnings			25,769	(b)		24,246
Per share net earnings(a)
	Basic		0.42	(b)		0.41
	Diluted		0.42	(b)		0.40

(a)	Basic per share amounts are based on average shares outstanding in each quarter. Diluted per share amounts reflect potential dilution from stock options and vesting of restricted stock, when applicable.
(b)	The fourth quarter 2005 includes an income tax charge of $16.4 million ($0.27 per share) related to the repatriation of $200 million in foreign earnings.
(c)	The third quarter 2004 includes a $13.0 million pre-tax gain ($0.14 per share) from the sale of a minority interest in an European joint venture.

Page 76 of 83

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

      None.

Item 9A. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

      We have established disclosure controls and procedures to ensure that material information relating to the Company is made known to the Chief Executive Officer and Chief Financial Officer who certify the Company’s financial reports.

      Our Chief Executive Officer and Chief Financial Officer have evaluated the Company’s disclosure controls and procedures as of the end of the period covered by this report and they have concluded that these controls and procedures are effective to ensure that the information required to be disclosed under the Securities Exchange Act of 1934 is disclosed within the time periods specified by SEC rules.

(b) Management’s Annual Report on Internal Control over Financial Reporting

      Management’s report on internal controls over financial reporting is on page 38 of this Form 10-K and is incorporated by reference.

(c) Attestation Report of the Registered Public Accounting Firm

      Management’s assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2005 has been audited by KPMG LLP, an independent accounting firm, as stated in their report on page 40 of this Form 10-K and is incorporated by reference.

(d) Changes in Internal Control over Financial Reporting

      There have been no significant changes in internal control over financial reporting that occurred during the fourth quarter of 2005 that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

Item 9B. OTHER INFORMATION

      None.

Page 77 of 83

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

EXECUTIVE OFFICERS	DIRECTORS
Dominic J. Pileggi Chairman of the Board, President and Chief Executive Officer Kenneth W. Fluke Senior Vice President and Chief Financial Officer Christopher P. Hartmann President — Electrical Division J.N. Raines Vice President — General Counsel and Secretary Stanley P. Locke Vice President — Controller	Dominic J. Pileggi Chairman of the Board, President and Chief Executive Officer Director since 2004 Ernest H. Drew Former Chief Executive Officer Industries and Technology Group Westinghouse Electric Corporation Director since 1989(1)(2)(*) Jeananne K. Hauswald Managing Director Solo Management Group, LLC Director since 1993(3) Dean Jernigan President of Jernigan Property Group, LLC Director since 1999(3) Ronald B. Kalich, Sr. President and Chief Executive Officer FastenTech, Inc. Director since 1998(3)*	Kenneth R. Masterson Former Executive Vice President, General Counsel and Secretary FedEx Corporation Director since 1993(1)(2)(4) Jean-Paul Richard Chairman of the Board and Chief Executive Officer H-E Parts, International Director since 1996(1)(*) David D. Stevens Chief Executive Officer Accredo Health, Incorporated Director since 2004(1)(2) William H. Waltrip Chairman of Technology Solutions Company Director since 1983(3)

(1)	Audit Committee
(2)	Nominating and Governance Committee
(3)	Compensation Committee
(4)	Lead Director effective January 2006

⁽*⁾  Committee Chair

      Information regarding members of the Board of Directors is incorporated by reference from the sections “Security Ownership,” “Board and Committee Membership,” “Compensation” and “Proposal No. 1, Election of Directors” of the definitive Proxy Statement for our Annual Meeting of Shareholders.

      Information regarding executive officers of the Corporation is included in Part I of this Form 10-K under the caption “Executive Officers of the Registrant” pursuant to Instruction 3 to Item 401(b) of Regulation S-K and General Instruction G(3) of Form 10-K.

      Information required by Item 405 of Regulation S-K is presented in the section entitled “Section 16(a) Beneficial Ownership Reporting Compliance” in the definitive Proxy Statement for our Annual Meeting of Shareholders, and is incorporated herein by reference.

      We have adopted a code of conduct that applies to all of our employees, officers, and directors. A copy of our code of conduct can be found on our internet site atwww.tnb.com. Any amendment to or waiver from any provision in our code of conduct required to be disclosed as Item 10 on Form 8-K will be posted on our Internet site.

Page 78 of 83

Item 11. EXECUTIVE COMPENSATION

      Information related to executive compensation is incorporated by reference to the section “Executive Compensation” of the definitive Proxy Statement for our Annual Meeting of Shareholders.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

      Information required by Item 403 of Regulation S-K appears in the section entitled “Security Ownership” in the definitive Proxy Statement for our Annual Meeting of Shareholders, is incorporated by reference.

      As of December 31, 2005, we had the following compensation plans under which common stock may be issued.

						Number of securities
						remaining available
						for future issuance
		Number of securities				under equity
		to be issued upon		Weighted-average		compensation plans
		exercise of		exercise price of		(excluding securities
		outstanding options,		outstanding options,		reflected in
		warrants and rights		warrants and rights		column(a))
Plan Category		(a)		(b)		(c)
Equity compensation plans approved by security holders
Equity Compensation Plan			529,702	$	29.50		2,891,402
Non-employee Directors Equity Compensation Plan			43,304		26.36		1,639,414
1993 Management Stock Ownership Plan			2,394,702		30.84		—
Equity compensation plans not approved by security holders
Deferred Fee Plan for Non-employee Directors			43,551		—		—
Non-employee Directors Stock Option Plan			94,934		21.34		—
2001 Stock Incentive Plan			884,598		19.47		—
	Total		3,990,791	$	27.84		4,530,816

      The 1993 Management Stock Ownership Plan, the Restricted Stock Plan for Non-employee Directors, the Deferred Fee Plan for Non-employee Directors, the Non-employee Directors Stock Option Plan and the 2001 Stock Incentive Plan were terminated in May 2004, and no new awards may be made under these plans. However awards issued under these plans prior to the termination date will continue under the terms of the award.

Deferred Fee Plan for Non-employee Directors

      The Deferred Fee Plan for Nonemployee Directors permitted a non-employee director to defer all or a portion of compensation earned for services as a director, and permitted the granting of stock appreciation rights as compensation to our directors. Any amount deferred was valued, in accordance with the director’s election, in a hypothetical investment in our common

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stock as stock appreciation rights or in one or more of seven mutual funds from the Vanguard Group. The stock appreciation rights fluctuate in value as the value of the Common Stock fluctuates. Each participant was credited with a dividend equivalent in stock appreciation rights for any dividends paid on our common stock. Stock appreciation rights are distributed in shares of our common stock and mutual fund accounts are distributed in cash upon a director’s termination of service.

Non-employee Directors Stock Option Plan

      The Nonemployee Directors Stock Option Plan provided that each nonemployee director, upon election at either an annual meeting or by the Board to fill a vacancy or new position, received a nonqualified stock option grant for shares of Common Stock in an amount determined by the Board of Directors. The option exercise price was the fair market value of our common stock on the option grant date. Each option grant was fully vested and exercisable on the date it was granted and has a term of ten years, subject to earlier expiration upon a director’s termination of service prior to exercise.

2001 Stock Incentive Plan

      The 2001 Stock Incentive Plan provided that key employees could receive nonqualified stock option grants for shares of Common Stock in an amount determined by the Board of Directors. The option exercise price was the fair market value of a share of Common Stock on the date the option is granted. Each option grant usually vests in increments of one-third over a three year period, and had a ten year life, subject to earlier expiration upon an employee’s termination of service.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      The information required by this item appears in the section entitled “Certain Relationships and Related Transactions” in the definitive Proxy Statement for our Annual Meeting of Shareholders and is incorporated herein by reference in response to this item.

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

      The sections entitled “Independent Registered Public Accounting Firm’s Fees” and “Pre-Approval Policies and Procedures” in the definitive Proxy Statement for our Annual Meeting of Shareholders, are incorporated by reference.

PART IV

Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

      The following documents are filed as a part of this Report:

      1. Financial Statements

      The following financial statements, related notes and report of the independent auditor are filed with this Annual Report in Part II, Item 8:

Reports of Independent Registered Public Accounting Firm

Consolidated Statements of Operations for 2005, 2004 and 2003

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Consolidated Balance Sheets as of December 31, 2005 and 2004

Consolidated Statements of Cash Flows for 2005, 2004 and 2003

Consolidated Statements of Shareholders’ Equity and Comprehensive Income for 2005, 2004 and 2003

Notes to Consolidated Financial Statements

      2. Financial Statement Schedules

      All financial statement schedules have been omitted because they are not applicable, not material, or the required information is included in the financial statements listed above or the notes.

      3. Exhibits

      The Exhibit Index on pagesE-1 throughE-4 is incorporated by reference.

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SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Corporation has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Thomas & Betts Corporation

(Registrant)

Date: February 27, 2006

By:  /s/Dominic J. Pileggi

Dominic J. Pileggi

President and Chief Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Corporation and in the capacities and on the dates indicated.

Signature	Title	Date
/s/Dominic J. Pileggi Dominic J. Pileggi	Chairman of the Board, President and Chief Executive Officer(Principal Executive Officer)	February 27, 2006
/s/Ernest H. Drew Ernest H. Drew	Director	February 27, 2006
/s/Jeananne K. Hauswald Jeananne K. Hauswald	Director	February 27, 2006
/s/Dean Jernigan Dean Jernigan	Director	February 27, 2006
/s/Ronald B. Kalich, Sr. Ronald B. Kalich, Sr.	Director	February 27, 2006
/s/Kenneth R. Masterson Kenneth R. Masterson	Director	February 27, 2006
/s/Jean-Paul Richard Jean-Paul Richard	Director	February 27, 2006
/s/David D. Stevens David D. Stevens	Director	February 27, 2006
/s/William H. Waltrip William H. Waltrip	Director	February 27, 2006

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Signature	Title	Date
/s/Kenneth W. Fluke Kenneth W. Fluke	Senior Vice President and Chief Financial Officer(Principal Financial Officer)	February 27, 2006
/s/Stanley P. Locke Stanley P. Locke	Vice President — Controller	February 27, 2006

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PART IV

EXHIBIT INDEX

Exhibit No.		Description of Exhibit
	3.1	Amended and Restated Charter of Thomas & Betts Corporation (Filed as Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 1999 and incorporated herein by reference).
	3.2	Amended and Restated Bylaws of Thomas & Betts Corporation (Filed as Exhibit 3.2 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	4.2	Supplemental Indenture dated as of May 2, 1996, between Thomas & Betts Corporation and First Trust of New York, as Trustee (Filed as Exhibit 4.3 to the Registration Statement on Form 8-B filed May 2, 1996 and incorporated herein by reference).
	4.3	Second Supplemental Indenture dated as of February 10, 1998, between Thomas & Betts Corporation and The Chase Manhattan Bank, as Trustee (Filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated February 2, 1998 and incorporated herein by reference).
	4.4	Third Supplemental Indenture dated as of May 7, 1998 between Thomas & Betts Corporation and The Chase Manhattan Bank, as Trustee (Filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated May 4, 1998 and incorporated herein by reference).
	4.5	Trust Indenture dated as of August 1, 1998 between Thomas & Betts Corporation and The Bank of New York, as Trustee (Filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated February 3, 1999 and incorporated herein by reference).
	4.6	Supplemental Indenture No. 1 dated February 10, 1999, between Thomas and Betts Corporation and The Bank of New York, a Trustee (Filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated February 3, 1999 and incorporated herein by reference).
	4.7	Supplemental Indenture No. 2 dated May 27, 2003, between Thomas & Betts Corporation and The Bank of New York, as Trustee (Filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated May 27, 2003 and incorporated herein by reference).
	10.1†	Thomas & Betts Corporation 1993 Management Stock Ownership Plan, as amended through June 5, 2001, and Forms of Grant Agreement (Filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 1, 2001 and incorporated herein by reference).
	10.2†	Pension Restoration Plan, as amended and restated, effective December 31, 2000 (Filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2002 and incorporated herein by reference.).
	10.3†	Retirement Plan for Non-employee Directors, as amended December 3, 1997 (Filed as Exhibit 10.9 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 28, 1997 and incorporated herein by reference).

E-1

Exhibit No.		Description of Exhibit
	10.4†	Deferred Fee Plan for Non-employee Directors as amended and restated effective May 6, 1998 (Filed as Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 3, 1999 and incorporated herein by reference).
	10.5†	Supplemental Executive Investment Plan, as amended and restated effective January 1, 1997 (Filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004 and incorporated herein by reference).
	10.6†	Restricted Stock Plan for Non-employee Directors as amended March 7, 2003 (Filed as Exhibit 10.7 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.7†	Non-employee Directors Stock Option Plan and Form of Stock Option Agreement, as amended March 9, 2001 (Filed as Exhibit 10.18 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000 and incorporated herein by reference).
	10.8†	Thomas & Betts Corporation 2001 Stock Incentive Plan (Filed as Exhibit 10.1 to our Registration Statement on Form S-8 dated May 2, 2001 (File No. 333-60074), and incorporated herein by reference).
	10.9†	Form of Termination Protection Agreement (Filed as Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.10†	Form of Termination Protection Agreement (Filed as Exhibit 10.12 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.11†	Executive Retirement Plan, as amended February 4, 2004 (Filed as Exhibit 10.13 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.12†	Retirement Agreement of T. Kevin Dunnigan dated December 2, 2003 (Filed as Exhibit 10 to the Registrant’s Current Report on Form 8-K dated December 4, 2003 and incorporated herein by reference).
	10.13†	Letter Agreement dated October 19, 2004, amending the Retirement Agreement of T. Kevin Dunnigan (Filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2004 and incorporated herein by reference).
	10.14†	Nonemployee Directors Equity Compensation Plan (Filed as Exhibit 10.19 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.15†	Form of Non-Qualified Stock Option Agreement pursuant to the Thomas & Betts Corporation Nonemployee Directors Equity Compensation Plan (Filed as Exhibit 10 to the Registrant’s Current Report on Form 8-K dated August 31, 2004 and incorporated herein by reference).
	10.16†	Equity Compensation Plan (Filed as Exhibit 10.20 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).

E-2

Exhibit No.		Description of Exhibit
	10.17†	Form of Restricted Stock Agreement pursuant to the Thomas & Betts Corporation Equity Compensation Plan (Filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated February 2, 2005 and incorporated herein by reference).
	10.18†	Form of Incentive Stock Option Agreement pursuant to the Thomas & Betts Corporation Equity Compensation Plan (Filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated February 2, 2005 and incorporated herein by reference).
	10.19†	Form of Nonqualified Stock Option Agreement pursuant to the Thomas&Betts Corporation Equity Compensation Plan (Filed as Exhibit 10.4 to the Registrant’s Current Report on Form 8-K dated February 2, 2005 and incorporated herein by reference).
	10.20†	Management Incentive Plan (Filed as Exhibit 10.21 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10.21	Settlement Agreement and Release dated February 21, 2002, between Tyco Group S.A.R.L. and Thomas & Betts Corporation. (Filed as Exhibit 10.14 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 30, 2001 and incorporated herein by reference).
	10.22†	Form of Indemnification Agreement (Filed as Exhibit 10.2 to the Form 10-Q for the quarter ended June 30, 2004 and incorporated herein by reference).
	10.23†	Form of Indemnification Agreement (Filed as Exhibit 10.3 to the Quarterly Report on Form 10-Q for the quarter ended September 30, 2004 and incorporated herein by reference).
	10.24†	Health Benefits Continuation Agreement dated February 2, 2005 between Thomas & Betts Corporation and Dominic Pileggi (Filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 2, 2005 and incorporated herein by reference).
	10.25†	Appendix A to Executive Retirement Plan, as amended June 1, 2005. (Filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated June 1, 2005, and incorporated herein by reference.)
	10.26†	Termination Protection Agreement between Thomas & Betts Corporation and Stanley P. Locke dated June 1, 2005. (Filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated June 1, 2005, and incorporated herein by reference.)
	10.27†	Separation Benefit Agreement and General Release between the Thomas & Betts Corporation and Connie C. Muscarella dated June 14, 2005. (Filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated June 17, 2005, and incorporated herein by reference.)
	10.28†	Form of Restricted Stock Agreement Pursuant to Thomas & Betts Corporation Nonemployee Directors Equity Compensation Plan. (Filed as Exhibit 10.28 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference.)

E-3

Exhibit No.		Description of Exhibit
	10.29	Credit Agreement, dated June 25, 2003, among Thomas & Betts Corporation, as borrower, certain of its subsidiaries, as guarantors, the lenders listed therein, Wachovia Bank, National Association, as issuing bank, Wachovia Securities, Inc., as arranger, and Wachovia Bank, National Association, as administrative agent (Filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 29, 2003 and incorporated herein by reference).
	10.30	Security Agreement, dated June 25, 2003, among Thomas & Betts Corporation and certain of its subsidiaries, as grantors, and Wachovia Bank, National Association, as administrative agent. (Filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 29, 2003 and incorporated herein by reference).
	10.31	Amended and Restated Credit Agreement dated as of June 14, 2005 among Thomas & Betts Corporation, as Borrower, The Guarantors Party Thereto, The Financial Institutions Party Thereto, Bank of America, N.A., Suntrust Bank and Regions Bank, as Co-Syndication Agents, LaSalle Bank, N.A., as Documentation Agent and Wachovia Bank, National Association, as Administrative Agent, Swing Bank and Issuing Bank (Filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated June 14, 2005 and incorporated herein by reference).
	10.32	First Amendment to Amended and Restated Credit Agreement dated August 12, 2005, among Thomas & Betts Corporation, as Borrower, the Lenders named therein, and Wachovia Bank, National Association, as Administrative Agent (Filed as Exhibit 10.1 to the Registrant’s Current Report of Form 8-K dated August 17, 2005 and incorporated herein by reference).
	12	Statement re Computation of Ratio of Earnings to Fixed Charges.
	21	Subsidiaries of the Registrant.
	23	Consent of KPMG LLP.
	31.1	Certification of Principal Executive Officer under Securities Exchange Act Rules 13a-14(a) or 15d-14(a).
	31.2	Certification of Principal Financial Officer under Securities Exchange Act Rules 13a-14(a) or 15d-14(a).
	32	Section 1350 Certifications.

†  Management contract or compensatory plan or arrangement.

E-4