Thomas & Betts 10K 2008 Annual report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K


(Mark One)
þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the fiscal year ended December 31, 2008
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 (Address of principal executive offices)		38125 (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 þ 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 Act.

Yes o No þ


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 þ No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 ofRegulation 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 thisForm 10-K or any amendment to thisForm 10-K.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” inRule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer þ		Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined inRule 12b-2 of the Exchange Act).

Yes o No þ

As of June 30, 2008, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was $2,189,946,117 based on the closing price as reported on the New York Stock Exchange.

As of February 13, 2009, 53,306,467 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		13
		Executive Officers of the Registrant		14

PART II
	Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities		16
		Performance Graph		17
	Item 6.	Selected Financial Data		19
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		20
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		38
	Item 8.	Financial Statements and Supplementary Data		40
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		92
	Item 9A.	Controls and Procedures		92
	Item 9B.	Other Information		92

PART III
	Item 10.	Directors, Executive Officers and Corporate Governance		93
	Item 11.	Executive Compensation		94
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters		94
	Item 13.	Certain Relationships and Related Transactions, and Director Independence		95
	Item 14.	Principal Accountant Fees and Services		95

PART IV
	Item 15.	Exhibits and Financial Statement Schedules		96
Signatures				97

EXHIBIT INDEX				E-1
Amended and Restated Supplemental Executive Investment Plan
Form of Restricted Stock Agreement Pursuant to 2008 Stock Incentive Plan
Form of Nonqualified Stock Option Agreement Pursuant to 2008 Stock Incentive Plan
Form of Restricted Stock Agreement for Nonemployee Directors Pursuant to 2008 Stock Incentive Plan
Form of Nonqualified Stock Option Agreement for Nonemployee Directors Pursuant to 2008 Stock Incentive Plan
Executive Retirement Plan, as Amended and Restated
Amended and Restated Termination Protection Agreement - Dominic J. Pileggi
Amended and Restated Termination Protection Agreement - Kenneth W. Fluke
Amended and Restated Termination Protection Agreement - Imad Hajj
Amended and Restated Termination Protection Agreement - J.N. Raines
Amended and Restated Termination Protection Agreement - William E. Weaver, Jr.
First Amendment to the Amended and Restated Termination Protection Agreement - Stanley P. Locke
First Amendment to the Supplemental Executive Incentive Plan
Statement Re Computation of Ratio of Earnings to Fixed Charges
Subsidiaries of the Registrant
Consent of KPMG LLP
Certification of Principal Executive Officer under Rules 13a-14(a) or 15d-14(a)
Certification of Principal Financial Officer under Rules 13a-14(a) or 15d-14(a)
Certification of Principal Executive Officer Pursuant to Rule 13a-14(b) or Rule 15d-14(b)
Certification of Principal Financial Officer Pursuant to Rule 13a-14(b) or Rule 15d-14(b)

Page 2 of 97

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This Report includes “forward-looking comments and statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts regarding Thomas & Betts Corporation and are subject to risks and uncertainties in our operations, business, economic and political environment.(a) Forward-looking statements contain words such as:


	•	“achieve”

	•	“should”

	•	“could”

	•	“may”

	•	“anticipates”

	•	“expects”

	•	“might”

	•	“believes”

	•	“intends”

	•	“predict”

	•	“will”

	•	other similar expressions

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.


^(a)		These risks and uncertainties, which are further explained in Item 1A. Risk Factors, include:


		• negative economic conditions could have a material adverse effect on our operating results and financial condition;

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

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

A reference in this Report to “we”, “our”, “us”, “Thomas & Betts” or the “Corporation” refers to Thomas & Betts Corporation and its consolidated subsidiaries.

Page 3 of 97

PART I


Item 1.	BUSINESS

Thomas & Betts Corporation is a leading designer and manufacturer of electrical components used in industrial, construction, retail, utility and communications markets. We are also a leading producer of highly engineered steel structures, used primarily for utility transmission, and commercial heating units. 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 the following channels:


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

	•	mass merchandisers, catalog merchandisers and home improvement centers; and

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

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 is www.tnb.com where interested parties can find our Annual Report onForm 10-K, Quarterly Reports onForm 10-Q, Current Reports onForm 8-K and amendments to those reports. These materials are free of charge and are made available 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 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 2008, 2007 or 2006.

Electrical Segment

Our Electrical segment’s markets include industrial MRO (maintenance, repair and operations) and OEM (original equipment manufacturers), construction, retail, utility and communications companies. This segment’s sales are concentrated primarily in North America and Europe. The Electrical segment experiences modest seasonal increases in sales during the second and third

Page 4 of 97

quarters reflecting the construction season. Net sales for the Electrical segment for the past three years were:


	2008			2007			2006

Segment Sales(in thousands)	$	2,103,121		$	1,766,598		$	1,511,557
Percent of Consolidated Net Sales		85.0	%		82.7	%		80.9	%

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;

	•	utility distribution connectors and switchgear;

	•	power quality equipment and services;

	•	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 Carlon^®,Color-Keyed^®, Cyberex^®, Elastimold^®, Emergi-Lite^®, Furse^®, Homac^tm, Iberville^®, Joslyn^®, Kindorf^®, Red-Dot^®, Sta-Kon^®, Steel City^®, Super Strut^®, 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, independent distributors and 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.

Investment activities in 2008 included two acquisitions totaling $91 million (The Homac Manufacturing Company and Boreal Braidings Inc.). Investment activities in 2007 included four acquisitions totaling $753 million (Lamson & Sessions Co., Joslyn Hi-Voltage, Power Solutions and Drilling Technical Supply SA). Investment activities in 2006 included acquisitions totaling $34 million, primarily for the acquisition of Hi-Tech Fuses, Inc.

Page 5 of 97

Steel Structures Segment

Our Steel Structures segment designs, manufactures and markets highly engineered tubular steel transmission and distribution poles. We also market lattice steel transmission towers for North American power and telecommunications companies, which we currently source from third parties. 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:


	2008			2007			2006

Segment Sales(in thousands)	$	231,554		$	227,356		$	221,671
Percent of Consolidated Net Sales		9.4	%		10.6	%		11.9	%

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 these regions are experiencing cold weather and, as a result, HVAC typically has higher sales in the first and fourth quarters. To reduce the impact of seasonality on operations, the segment offers an off-season sales promotional program with its distributors. Net sales for the HVAC segment for the past three years were:


	2008			2007			2006

Segment Sales(in thousands)	$	139,149		$	142,934		$	135,461
Percent of Consolidated Net Sales		5.6	%		6.7	%		7.2	%

Manufacturing and Distribution

We employ advanced processes for manufacturing quality products. Our manufacturing processes include high-speed stamping, precision molding, machining, plating, pressing, welding 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 ofcomputer-aided design and computer-aided manufacturing (CAD/CAM) software and equipment to link product engineering with our manufacturing facilities. Additionally, we utilize other advanced 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.

Page 6 of 97

Our products have historically enjoyed a reputation for quality in the markets in which they are sold. To ensure we maintain these high quality standards, all facilities embrace quality programs, and approximately 75% meet the ISO 9001 2000 standard as of December 31, 2008, with future certifications to be performed under ISO 9001 2008 standards as applicable. 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 sufficiently meet our needs. However, from time to time, we can 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 a long-standing reputation for innovation and value based upon our ability to develop products that meet the needs of the marketplace. Each of our business segments maintain research, development and engineering capabilities intended to directly respond to specific market needs.

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


	2008			2007			2006

R&D Expenditures(in thousands)	$	35,145		$	29,869		$	25,156
Percent of Net Sales		1.4	%		1.4	%		1.3	%

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 2,000 active patent registrations and applications worldwide. We have over 1,500 active trademarks and domain names worldwide, including:Thomas & Betts, T&B, T&B Access, Blackburn, Bowers, Canstrut, Carlon, Catamount, Color-Keyed, Commander, Cyberex, Deltec, Diamond, DuraGard, Elastimold, Emergi-Lite,E-Z-Code, Flex-Cuf, Furse, Hazlux, Homac, Iberville, JoslynHi-Voltage, 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, Super Strut, Ty-Duct, Ty-Rap and Union.

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, theCarlon, Color-Keyed, Elastimold, Iberville, Kindorf, Red-Dot,Sta-Kon, Steel City, Superstrut,andTy-Raptrademarks are important to the Electrical segment; theMeyertrademark is important to the Steel Structures segment; and theReznortrademark is important to the

Page 7 of 97

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.

Although we believe that we have specific technological and other advantages over some of our competitors, our competitors’ ability to develop new product offerings with competitive price and performance characteristics could lead to increased downward pressure on the selling prices for 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, 2008, we had approximately 10,000 full-time employees worldwide. Employees of our foreign subsidiaries comprise approximately 45% of all employees. Approximately 20% of our U.S. and approximately 30% our worldwide employees 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 will not be material to our financial position.

Financial Information About Foreign and U.S. Operations

Export sales originating in the U.S. were approximately $64 million in 2008, $62 million in 2007 and $37 million in 2006. For additional financial information about international and U.S. operations, please refer to Note 18 in the Notes to Consolidated Financial Statements.

Page 8 of 97


Item 1A.	RISK FACTORS

There are many factors that could pose a material risk to our business, its operating results, its 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.

The success of Thomas & Betts’ business is directly linked to positive economic conditions in the countries where we sell our products. We do business in geographically diverse markets. In 2008, approximately one-third of our net sales were generated outside of the United States. Turmoil in the financial markets during 2008 has adversely affected economic activity in the United States and other regions of the world in which we do business. The current economic environment has had an adverse affect on demand in our primary markets and a continued decline in economic activity could adversely affect demand for products in each of our business segments, thereby having a material adverse impact on our operating results and financial condition. Additionally, these conditions could also impair the ability of those with whom we do business to satisfy their obligations to us. Finally, a continued decline in economic activity could result in adverse changes to our current stock market-related fundamentals and current projected future operating results that are used to assess asset valuations (including goodwill and other intangible assets). Such revisions could lead to potentially significant financial impairment charges for these assets in future periods. Material adverse changes in economic (including the potential negative impact of higher interest rates and availability of credit 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 our operating results and financial condition.

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

In recent years, we have experienced rising and, at times, volatile costs for commodity raw materials (steel, aluminum, copper, zinc, resins and rubber compounds) and energy. Additionally, increased worldwide demand for steel has, at times, caused the availability of steel to be a concern and resin supply has been disrupted by natural disasters. Any significant accidents, labor disputes, fires, severe weather, floods or other difficulties encountered by our principal suppliers could result in production delays or the inability to fulfill orders on a timely basis. We may also not be able to fully offset in the future the effects of rising and at times volatile 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 we serve, we could experience increased downward pressure on the selling prices for certain of our products.

Additionally, enhanced product offerings by competitors, coupled with any unforeseeable significant changes in customer demand for products of Thomas & Betts, could impact overall

Page 9 of 97

product mix, pricing, margins, plant utilization levels and asset valuations, thereby having a material adverse impact on our operating results and financial condition.

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 our 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, our 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 we are not dependent on any one customer for more than 10% of our 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 and policies throughout the world. Unforeseen changes in these governmental regulations and policies 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 we 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.

Unfavorable litigation outcomes could have a material adverse effect on our profitability.

We are and may in the future be party to legal proceedings and claims, including those involving product liability, intellectual property and contractual disputes. Given the inherent uncertainty of litigation, we cannot offer any assurance that existing litigation or future adverse developments may not have a material adverse effect on our business, operating results and financial condition.

Page 10 of 97

Inability to access capital markets may adversely affect our business.

Our ability to invest in our businesses and make strategic acquisitions may require access to capital markets. If we are unable to access the capital markets as needed, we could experience a material adverse affect on our business.

Our facilities or facilities of our customers could be susceptible to natural disasters.

Thomas & Betts 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 Thomas & Betts, or damage a major facility of one or more of our significant customers or important suppliers, our business could be materially disrupted.

Possible inadequate insurance coverage.

In accordance with its risk management practices, Thomas & Betts continually reevaluates risks, their potential cost and the cost of minimizing them. To reduce the Corporation’s exposure to material risks, in certain circumstances, we purchase insurance. Certain risks are inherent in the manufacturing of our products and our insurance may not be adequate to cover potential claims against us involving our products. Thomas & Betts is also exposed to risks inherent in the packaging and distribution of products. Although we maintain liability insurance, we cannot assure that the coverage limits under these insurance programs will be adequate to protect Thomas & Betts against future claims, or that we 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.

Page 11 of 97


Item 2.	PROPERTIES

We have operations in approximately 20 countries and, as of December 31, 2008, occupy approximately 5.4 million sq. ft. of manufacturing space. Our manufacturing locations by segment as of December 31, 2008 were as follows:


		Approximate
		Area in Sq. Ft.
		(000s)
Segment	Location	Leased		Owned

Electrical	Arkansas		—		286
	California		113		—
	Florida		—		189
	Iowa		—		159
	Mississippi		—		237
	New Jersey		—		134
	New Mexico		—		100
	New York		—		268
	North Carolina		—		22
	Ohio		—		159
	Puerto Rico		68		28
	Tennessee		—		457
	Virginia		100		—
	Australia		28		29
	Canada		100		751
	France		—		52
	Germany		30		—
	Hungary		88		—
	Japan		12		—
	Mexico		531		—
	Netherlands		8		39
	United Kingdom		40		125

Steel Structures	Alabama		—		240
	South Carolina		—		105
	Texas		—		136
	Wisconsin		—		171

HVAC	Pennsylvania		—		227
	Belgium		140		—
	France		25		—
	Mexico		214		—

As of December 31, 2008, the Corporation has 2.4 million sq. ft of office, distribution, storage and other space. Included in this total are three owned primary 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, storage and other facilities in approximately

Page 12 of 97

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


Item 3.	LEGAL PROCEEDINGS

We are 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 certainty. 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 and do not reflect possible recovery from insurance companies or other parties. 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. We have 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 eight 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); Massachusetts (Attleboro, Boston, Canton); New Hampshire (New Milford); New Jersey (Butler, Elizabeth, Garwood); Pennsylvania (Perkasie); Ohio (Bucyrus, Kent) and Oklahoma (Stillwater). The sites further include active manufacturing locations in Florida (Ormond Beach); New Jersey (Hackettstown); New Mexico (Albuquerque); and South Carolina (Lancaster).

In conjunction with the acquisitions of Lamson & Sessions Co., Joslyn Hi-Voltage, Power Solutions, Drilling Technical Supply SA, The Homac Manufacturing Company and Boreal Braidings Inc., we assumed responsibility for environmental matters for those entities. Related to the acquisition of Lamson & Sessions Co., we assumed responsibility for environmental liabilities involving a site in Ohio.

We have provided for environmental 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. We believe that any additional liability with respect to the aforementioned environmental matters will not be material to our financial position.


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, 2008.

Page 13 of 97

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, 57

Chairman 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 Corporation, 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 from 1998 to 2000 and President – EMS Division of Viasystems in 2000.

Kenneth W. Fluke, 49

Senior Vice President and 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 since 2000. Previously, he held various finance and managerial positions with The Goodyear Tire and Rubber Company beginning in 1982.

J.N. Raines, 65

Vice President – General Counsel and Secretary

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

Imad Hajj, 48

Senior Vice President – Global Operations

Mr. Hajj was elected Senior Vice President– Global Operations in November 2008. Previously, he held several executive positions within the Corporation, including Vice President and Chief Development Officer 2006 to 2008. He also held the position of President – HVAC Division dating back to 2004. Between 1983 and 2004, Mr. Hajj held executive and managerial positions in manufacturing, supply chain, information technology and global electrical manufacturing operations.

Stanley P. Locke, 49

Vice President – Business Development and Strategic Planning

Mr. Locke was elected Vice President – Business Development and Strategic Planning in November 2008. Previously, he was Vice President – Controller from 2004 to 2008. Prior to that time, 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.

William E. Weaver, Jr., 45

Vice President – Controller

Mr. Weaver was elected Vice President – Controller in November 2008. Between 2006 and 2008, he was Vice President-Chief Financial Officer of First Horizon Home Loans/MetLife Home Loans. He was a partner with KPMG LLP between 2002 and 2006. Prior to joining KPMG LLP,

Page 14 of 97

Mr. Weaver held various positions including partner with Arthur Andersen LLP between 1984 and 2002.

NYSE Certifications

Our CEO certified to the New York Stock Exchange in 2008 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 thisForm 10-K for the fiscal year ended December 31, 2008.

Page 15 of 97

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 13, 2009, the closing price of our common stock on the NYSE was $25.99.


	2008		2007

First Quarter
Market price high	$	49.12	$	53.93
Market price low	$	33.26	$	44.99
Second Quarter
Market price high	$	43.69	$	59.16
Market price low	$	34.70	$	48.05
Third Quarter
Market price high	$	48.19	$	64.28
Market price low	$	32.16	$	50.23
Fourth Quarter
Market price high	$	38.92	$	62.20
Market price low	$	15.79	$	48.58

Holders

At February 13, 2009, we had 2,816 shareholders of record, not including shares held in security position listings, or “street name.”

Dividends

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

Page 16 of 97

PERFORMANCE GRAPH

This graph shows, from the end of 2003 to the end of 2008, changes in the value of $100 invested in each of Thomas and Betts’ common stock, Standard & Poor’s 500 Composite Index, and a peer group consisting of five companies whose businesses are representative of our business segments. The companies in the peer group are: Amphenol Corporation, Cooper Industries, Ltd., Eaton Corporation, Hubbell Incorporated and Rockwell Automation Corporation.


	Dec-03		Dec-04		Dec-05		Dec-06		Dec-07		Dec-08
Thomas & Betts Corp.	$	100	$	134	$	183	$	207	$	214	$	105
S&P 500^®	$	100	$	111	$	116	$	135	$	142	$	90
Custom Peer Group (5 Stocks)	$	100	$	131	$	140	$	163	$	205	$	109

The Peer Group has been weighted in accordance with each company’s market capitalization as of the beginning of each of the five years covered by the performance graph. The weighted return was calculated by summing the products obtained by multiplying (i) the percentage that each company’s market capitalization represents of the total market capitalization for all companies in the indexes by (ii) the total shareholder return for that company.

Page 17 of 97

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In 2007, our Board of Directors approved a share repurchase plan that authorized us to buy an additional 3,000,000 of our common shares. In 2007, we repurchased, with available cash resources, 200,700 common shares through open-market transactions. During 2008, we repurchased, with available cash resources, the remaining 2,799,300 common shares authorized by this plan through open-market transactions.

In 2008, our Board of Directors approved a share repurchase plan that authorized us to buy an additional 5,000,000 of our common shares. In 2008, we repurchased, with available cash resources, 2,425,000 common shares through open-market transactions. The timing of future repurchases, if any, will depend upon a variety of factors, including market conditions. This authorization expires in October 2010.

Issuer Purchases of Equity Securities


					Total		Maximum
					Number		Number
					of Common		of Common
					Shares		Shares
	Total				Purchased		that May
	Number of		Average		as Part of		Yet Be
	Common		Price Paid		Publicly		Purchased
	Shares		per Common		Announced		Under
	Purchased		Share		Plans		the Plans

March 2007 Plan (3,000,000 common shares authorized)
1st Quarter, 2008		—		—		—		2,799,300
2nd Quarter 2008		—		—		—		2,799,300
3rd Quarter 2008		2,299,300	$	43.71		2,299,300		500,000
4th Quarter 2008:
October 28, 2008 to November 5, 2008		500,000	$	23.00		500,000		—

Plan total for Year End December 31, 2008		2,799,300	$	40.01		2,799,300		—

October 2008 Plan (5,000,000 common shares authorized)
4th Quarter 2008:
November 6, 2008 to November 21, 2008		1,000,000	$	20.45		1,000,000		4,000,000
December 1, 2008 to December 15, 2008		1,425,000	$	20.26		1,425,000		2,575,000

Plan total for Year End December 31, 2008		2,425,000	$	20.34		2,425,000		2,575,000

Page 18 of 97


Item 6.	SELECTED FINANCIAL DATA

Thomas & Betts Corporation and Subsidiaries


(In thousands, except per share data)	2008		2007		2006		2005		2004

Net sales	$	2,473,824	$	2,136,888	$	1,868,689	$	1,695,383	$	1,516,292
Net earnings from continuing operations	$	273,686	$	183,676	$	175,130	$	113,408	$	93,255
Total assets	$	2,410,602	$	2,567,786	$	1,830,223	$	1,920,396	$	1,755,752
Long-term debt including current maturities	$	660,944	$	811,205	$	387,631	$	537,959	$	545,915
Per share earnings from continuing operations:
Basic	$	4.84	$	3.17	$	2.90	$	1.89	$	1.59
Diluted	$	4.79	$	3.13	$	2.85	$	1.86	$	1.57

Note: Selected financial data in 2008 and 2007 reflect acquisitions by the Corporation for consideration of approximately $90 million and $750 million, respectively. The Corporation funded certain of the 2008 and 2007 acquisitions using its revolving credit facility. Net earnings from continuing operations in 2008 reflects a gain of approximately $170 million from the Corporation’s sale of its minority interest in Leviton Manufacturing Company.

Page 19 of 97


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

Executive Overview

Introduction

Thomas & Betts had another successful year in 2008, despite the economic turmoil that began in the second half of the year. During 2008, we faced fluctuating commodity costs, competitive pricing pressures and softening demand, especially in our domestic markets. The current economic environment has adversely affected demand in our primary markets and we responded swiftly and decisively in 2008 to minimize the impact of the economic downturn as it began to spread beyond the residential-related markets. Since mid-2008, we have reduced our employee headcount by approximately 12%. Each of our segments performed well notwithstanding the challenging current year environment. We completed two acquisitions in early 2008 and have essentially completed the integration of the 2007 and 2008 acquisitions. These acquisitions played a major role in the significant 2008 and 2007 increases in net sales and gross profit over the respective prior year. Net earnings from continuing operations in 2008 benefited by the gain on sale of our minority interest in Leviton Manufacturing Company. Finally, during 2008, we completed planned divestures of non-core pipe businesses acquired as part of the 2007 acquisition of Lamson & Sessions Co. The challenges encountered in the second half of 2008 are expected to have a deepening impact on 2009. Refer to our “2009 Outlook” for a further discussion.

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 products are shipped and the customer takes ownership and assumes risk of loss, collection of the relevant receivable is probable, persuasive evidence of an arrangement exists and the sales price is fixed or determinable. We recognize revenue for service agreements over the applicable service periods. Sales discounts, quantity and price rebates, and allowances are estimated based on contractual commitments and experience and recorded as a reduction of 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 oryear-over-year sales volume growth targets for specific customers. Certain distributors can take advantage of price rebates by subsequently reselling our 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. We provide allowances for doubtful accounts when credit losses are both probable and estimable. A number of distributors, primarily in our Electrical segment, have the right to return goods under certain circumstances and those returns, which are reasonably estimable, are accrued as

Page 20 of 97


		a reduction of revenue at the time of shipment. We analyze 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, we periodically evaluate the carrying value of our inventories. We also periodically perform 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 Statement of Financial Accounting Standard (SFAS) No. 141, “Business Combinations.” SFAS No. 141 requires that all business combinations be accounted for under the purchase method of accounting. Under SFAS No. 141, all assets and liabilities acquired in a business combination, including goodwill, indefinite-lived intangibles and other intangibles, are recorded at fair value. The initial recording of goodwill and other intangibles requires subjective judgments concerning estimates of the fair value of the acquired assets and liabilities. Goodwill consists principally of the excess of cost over the fair value of net assets acquired in business combinations and is not amortized. For each amortizable intangible asset, we use a method of amortization that reflects the pattern in which the economic benefits of the intangible asset are consumed. If that pattern cannot be reliably determined, the straight-line amortization method is used. We also follow 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. We perform our annual impairment assessment as of the beginning of the fourth quarter of each year, unless circumstances dictate more frequent interim assessments. In evaluating when an interim assessment is necessary, we consider, among other things, the trading level of our common stock, changes in expected future cash flows and mergers and acquisitions involving companies in our industry.

Under the provisions of SFAS No. 142, each test of goodwill requires us to determine the fair value of each reporting unit and compare the fair value to the reporting unit’s carrying amount. SFAS No. 142 defines a reporting unit as an operating segment or one level below an operating segment. We determine the fair value of our reporting units using a combination of three valuation methods: market multiple approach; discounted cash flow approach; and comparable transactions approach. The market multiple approach provides indications of value based on market multiples for public companies involved in similar lines of business. The discounted cash flow approach calculates the present value of projected future cash flows using appropriate discount rates. The comparable transactions approach provides indications of value based on an examination of recent transactions in which companies in similar lines of business were acquired. The fair values derived from these three valuation methods are then blended to arrive at a single value for each reporting unit. Our determination of fair values as of the beginning of the fourth quarter of 2008 involved a weighting of 25% to the market multiple approach, 50% to the discounted cash flow approach and 25% to the comparable transactions approach. We then reconcile the total values for all reporting units to our market capitalization and evaluate the reasonableness of the implied control premium.

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 we must perform a second more detailed impairment assessment. The second impairment assessment involves allocating the

Page 21 of 97

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.

Methods used to determine fair values for indefinite-lived intangible assets involve customary valuation techniques that are applicable to the particular class of intangible asset and apply inputs and assumptions that we believe a market participant would use.

Our annual assessment as of the beginning of the fourth quarter of 2008 of intangible assets with indefinite lives concluded that the fair value of such assets in the Electrical segment were impaired by $32.7 million. Additionally, our annual assessment as of the beginning of the fourth quarter of 2008 concluded that there was no impairment of goodwill. Circumstances subsequent to the 2008 annual assessment did not warrant us performing an interim review of goodwill or indefinite-lived intangible assets. See Note 8 of the Notes to Consolidated Financial Statements.


	•	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, we evaluate assets at the lowest level of identifiable cash flows for associated product groups. We review long-lived assets to beheld-and-used for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Indications of impairment require significant judgment by management. 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, we estimate fair values 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 dispose.

	•	Pension and Other Postretirement Benefit Plan Actuarial Assumptions: We follow the provisions of SFAS No. 87, “Employers’ Accounting for Pensions,” SFAS No. 88, “Employers’ Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits,” SFAS No. 106, “Employers’ Accounting for Postretirement Benefits Other than Pensions,” SFAS No. 132 (Revised), “Employers’ Disclosures about Pensions and Other Postretirement Benefits” and SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans.” For purposes of calculating pension and postretirement medical benefit obligations and related costs, we use certain actuarial assumptions. Two critical assumptions, the discount rate and the expected return on plan assets, are important elements of expenseand/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

Page 22 of 97


		book and tax bases of assets and liabilities and requires an evaluation of asset realizability based on a more-likely-than-not criteria. We have valuation allowances for deferred tax assets primarily associated with foreign net operating loss carryforwards and foreign income tax credit carryforwards. Realization of the deferred tax assets is dependent upon our ability to generate sufficient future taxable income. We believe that it is more-likely-than-not that future taxable income, based on enacted tax laws in effect as of December 31, 2008, will be sufficient to realize the recorded deferred tax assets net of existing valuation allowances.


	•	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. The operation of manufacturing plants involves a high level of susceptibility in these areas, and there is no assurance that we 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.

2009 Outlook

We expect the current economic environment will negatively impact our primary markets during a significant portion of 2009, with the impact being most prominent on the first half of 2009. We expect 2009 total company net sales to decline by 7% to 12% year-over-year. Electrical segment net sales are expected to decline year-over-year by 10% to 15%, with foreign currency negatively impacting net sales by approximately 5% and net volume contributing to the remaining 5% to 10% of the deterioration. Additionally, we expect to experience lower volumes in nearly all geographical and product markets, with the U.S. market deteriorating much more significantly than other geographic regions we cover. In the Steel Structures segment, we expect low double-digit sales growth, driven by volume and higher comparable steel prices. We expect a mid-single digit sales decline in the HVAC segment that is primarily volume related. We expect diluted per share earnings in the range of $3.00 to $3.50 for the full-year 2009.

Full-year 2009 earnings guidance assumptions include depreciation and capital spending of $55 million each, corporate expenses of $60 million ($15 million per quarter), share based compensation of $15 million, acquisition-related amortization of $25 million, interest expense of $35 million, an effective tax rate of approximately 30% and 53 million fully diluted average shares outstanding. Additionally, our guidance reflects approximately $20 million in benefits from the acquisition integration efforts undertaken in 2008, although this will be entirely offset by higher pension costs.

The key risk factors we may face in 2009 include the impact on our primary markets from a prolonged disruption in credit markets and the negative impact on credit availability, excessive fluctuation in foreign currencies versus the U.S. dollar, volatility in commodity costs and availability and additional or heightened slowdowns in key market segments and geographic regions.

Page 23 of 97

Summary of Consolidated Results


	2008						2007						2006
	In			% of Net			In			% of Net			In			% of Net
	Thousands			Sales			Thousands			Sales			Thousands			Sales

Net sales	$	2,473,824			100.0		$	2,136,888			100.0		$	1,868,689			100.0
Cost of sales		1,697,844			68.6			1,475,347			69.0			1,298,347			69.5

Gross profit		775,980			31.4			661,541			31.0			570,342			30.5
Selling, general and administrative		430,717			17.4			371,853			17.4			323,577			17.3
Intangible asset impairment		32,700			1.3			—			0.0			—			0.0

Earnings from operations		312,563			12.7			289,688			13.6			246,765			13.2

Interest expense, net		(43,426	)		(1.8	)		(23,521	)		(1.2	)		(14,840	)		(0.8	)
Other (expense) income, net		(7,737	)		(0.3	)		(2,276	)		(0.1	)		1,517			0.1
Gain on sale of equity interest		169,684			6.9			—			0.0			—			0.0

Earnings from continuing operations before income taxes		431,084			17.5			263,891			12.3			233,442			12.5
Income tax provision		157,398			6.4			80,215			3.7			58,312			3.1

Net earnings from continuing operations		273,686			11.1			183,676			8.6			175,130			9.4
Loss from discontinued operations, net		(8,355	)		(0.3	)		(460	)		(0.0	)		—			—

Net earnings	$	265,331			10.8		$	183,216			8.6		$	175,130			9.4

Basic earnings (loss) per share:
Continuing operations	$	4.84					$	3.17					$	2.90
Discontinued operations		(0.15	)					(0.01	)					—

Net earnings	$	4.69					$	3.16					$	2.90

Diluted earnings (loss) per share:
Continuing operations	$	4.79					$	3.13					$	2.85
Discontinued operations		(0.15	)					(0.01	)					—

Net earnings	$	4.64					$	3.12					$	2.85

Year 2008 Compared with 2007

Overview

Thomas & Betts’ 2008 performance exceeded that of 2007, despite the economic turmoil that began to spread beyond the residential-related markets in the second half of the year. Net sales and gross profit in 2008 increased from 2007 by 16% and 17%, respectively. Electrical segment acquisitions completed in 2007 and early 2008 played a major role in the year-over-year increases in net sales and gross profit. Price increases in 2008 related to higher commodity and energy costs helped to offset lower underlying sales volumes in the current year. Gross profit in 2008 as a percent of net sales increased modestly over the prior year.

Earnings from operations in 2008 were negatively impacted by a $32.7 million non-cash charge in the fourth quarter for the impairment of intangible assets. Selling, general and administrative expenses in 2008 as a percent of net sales remained flat with the prior year.

Interest expense, net increased year-over-year primarily as a result of funding required for acquisitions.

During 2008, we sold our minority interest in Leviton Manufacturing Company and recognized a pre-tax gain of $170 million.

Page 24 of 97

Net earnings from continuing operations in 2008 were $273.7 million, or $4.79 per diluted share. Net earnings from continuing operations in 2007 were $183.7 million, or $3.13 per diluted share.

The 2008 $8.4 million loss from discontinued operations, net reflects a fourth quarter loss on sale in conjunction with the completion of planned divestures of non-core pipe businesses acquired as part of the prior year acquisition of Lamson & Sessions Co.

Net earnings including discontinued operations in 2008 were $265.3 million, or $4.64 per diluted share. Net earnings including discontinued operations in 2007 were $183.2 million, or $3.12 per diluted share.

Net Sales and Gross Profit

Net sales in 2008 were $2.5 billion, up $336.9 million, or 15.8%, from 2007. Acquisitions completed in 2007 and early 2008 accounted for $314 million of the year-over-year increase in net sales. Price increases in 2008 related to higher commodity and energy costs helped to offset lower underlying sales volumes in the current year. Favorable foreign currency exchange driven by strong Canadian and European currencies against a weaker U.S. dollar, primarily in the first half of the year, accounted for approximately $19 million of the sales increase.

Gross profit in 2008 was $776.0 million, or 31.4% of net sales, compared to $661.5 million, or 31.0% of net sales, in 2007. The year-over-year improvement in gross profit dollars and percent of net sales largely reflects the favorable impact of acquisitions.

Expenses

Selling, general and administrative (“SG&A”) expense in 2008 was $430.7 million, or 17.4% of net sales, compared to $371.9 million, or 17.4% of net sales, in the prior year. The $59 million increase in SG&A expense largely reflects the impact of the acquisitions. SG&A expense in 2008 included $26.6 million of intangible asset amortization and a favorable $12 million legal settlement. SG&A expense in 2007 included $8.3 million of intangible asset amortization ($7 million of which related to the 2007 acquisitions), a $7 million charge for a legal settlement and $7 million in expenses for revised estimates for certain environmental site remediation.

Interest Expense, Net

Interest expense, net was $43.4 million for 2008 up $19.9 million from the prior year primarily as a result of funding required for the acquisitions and lower interest income. Interest income included in interest expense, net was $4.6 million for 2008 compared to $10.6 million for 2007. Interest expense was $48.0 million for 2008 and $34.1 million for 2007.

Income Taxes

The effective tax rate in 2008 was 36.5 percent compared to 30.4 percent in 2007. The higher 2008 rate reflects the impact on domestic pre-tax earnings of the $170 million gain on sale of our minority interest in Leviton Manufacturing Company and the $32.7 million non-cash charge for the impairment of intangible assets. Additionally, the 2008 rate reflects an out-of-period, non-cash tax charge of $14 million. The effective rate for both years reflects benefits from our Puerto Rican manufacturing operations.

Page 25 of 97

Net Earnings

Net earnings from continuing operations in 2008 were $273.7 million, or $4.79 per diluted share. Net earnings from continuing operations in 2007 were $183.7 million, or $3.13 per diluted share. Higher 2008 net earnings from continuing operations reflect the previously noted gain on sale of our minority interest in Leviton Manufacturing Company, a favorable legal settlement, a non-cash tax charge related to an adjustment of prior period deferred income taxes and a non-cash charge for the impairment of intangible assets (collectively, $1.31 per diluted share).

Loss from discontinued operations, net in 2008 was $8.4 million, or $0.15 per diluted share, in 2008 compared to $0.5 million, or $0.01 per diluted share, in 2007. Loss from discontinued operations, net in 2008 reflects an $8.1 million loss on sale in conjunction with the completion of planned divestures of non-core pipe businesses acquired as part of the prior year acquisition of Lamson & Sessions Co.

Year 2007 Compared with 2006

Overview

The Corporation had an outstanding year in 2007, growing net sales by 14% and improving both gross profit and earnings from operations as a percent of sales. We completed four strategic acquisitions during the year, including Joslyn Hi-Voltage, Powers Solutions and Drilling Technical Supply SA in July 2007 and Lamson & Sessions Co. in November 2007. As a result of the Corporation’s decision to divest the PVC and HDPE pipe operations acquired as part of Lamson & Sessions Co., the operating results of the pipe operations are shown as discontinued operations on a net basis in the consolidated financial statements and are not included in segment earnings.

Our financial performance is volume sensitive. The 14% sales increase was driven primarily by our Electrical segment. Acquisitions and net volume increases from strong demand in industrial and construction markets drove the net sales increase, with price increases and favorable foreign currency exchange rates contributing to a lesser degree.

During 2007, gross profit increased 16%, reflecting higher sales volumes, favorable product mix and our continued success in offsetting increased material and energy cost inflation. Gross profit reflected $2 million of acquisition-related inventorystep-up amortization and approximately $2 million in net expenses related to a plant consolidation. Earnings from operations increased 17% and reflected a $7 million charge for a legal settlement, $7 million in expenses for revised estimates for certain environmental site remediation and $9 million of acquisition-related amortization of intangible assets. Acquisitions, net of the amortization charges, contributed approximately $5 million to theyear-over-year increase in earnings from operations and reduced gross profit and earnings from operations as a percent of sales.

Interest expense, net increased $9 million in 2007 primarily as a result of funding required for the current year acquisitions.

Net earnings from continuing operations in 2007 were $3.13 per diluted share compared to $2.85 per diluted share in the prior year. Net earnings in 2006 included a fourth quarter income tax benefit of $36.5 million relating to the release of state tax valuation allowances. The Corporation also recorded a fourth quarter 2006 income tax provision of $31.9 million related to the distribution

Page 26 of 97

of approximately $100 million from a foreign subsidiary. Net earnings in 2007 including discontinued operations were $3.12 per diluted share.

Net Sales and Gross Profit

Net sales in 2007 were $2.1 billion, up $268.2 million, or 14.4%, from 2006. Acquisitions accounted for approximately 6% of the sales increase, with net volume increases from existing businesses and price increases to offset higher material and energy costs also contributing 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 $45 million of the sales increase.

Gross profit in 2007 was $661.5 million, or 31.0% of net sales, compared to $570.3 million, or 30.5% of net sales, in 2006. This improvement reflects higher sales volumes, favorable product mix and our continued success in offsetting increased material and energy cost inflation. Gross profit in 2007 reflected $2 million of acquisition-related inventorystep-up amortization and approximately $2 million in net expenses related to a plant consolidation.

Expenses

Selling, general and administrative expense in 2007 was $371.9 million, or 17.4% of net sales, compared to $323.6 million, or 17.3% of net sales, in the prior year. Theyear-over-year increase in SG&A expense reflects the unfavorable impact of a $7 million charge for a legal settlement, $7 million in expenses for revised estimates for certain environmental site remediation and $7 million of acquisition-related amortization of intangible assets. SG&A as a percent of net sales was in line with 2006 despite the additional charges noted above.

Interest Expense, Net

Interest expense, net was $23.5 million for 2007 up $8.7 million from the prior year primarily as a result of funding required for the current year acquisitions. Interest income included in interest expense, net was $10.6 million for 2007 compared to $15.1 million for 2006. Interest expense was $34.1 million for 2007 and $29.9 million for 2006.

Income Taxes

The effective tax rate in 2007 was 30.4 percent compared to 25.0 percent in 2006. The Corporation recorded an income tax net benefit of $36.5 million in the fourth quarter of 2006 relating to the release of state tax valuation allowances. In addition, the Corporation recorded an income tax provision of $31.9 million in the fourth quarter of 2006 as a result of the distribution of $100 million from a foreign subsidiary. The effective rate for both years reflects benefits from our Puerto Rican manufacturing operations.

Net Earnings

Net earnings from continuing operations in 2007 were $183.7 million, or $3.13 per diluted share, compared to net earnings from continuing operations of $175.1 million, or $2.85 per diluted share, in the prior year. Higher 2007 earnings reflect increased earnings from operations offset in part by higher interest expense and income taxes. Loss from discontinued operations, net in 2007 was $0.5 million, or $0.01 per diluted share. Net earnings in 2007 including discontinued operations were $183.2 million, or $3.12 per diluted share.

Page 27 of 97

Summary of Segment Results


	2008				2007				2006
	In		% of Net		In		% of Net		In		% of Net
Net Sales	Thousands		Sales		Thousands		Sales		Thousands		Sales

Electrical	$	2,103,121		85.0	$	1,766,598		82.7	$	1,511,557		80.9
Steel Structures		231,554		9.4		227,356		10.6		221,671		11.9
HVAC		139,149		5.6		142,934		6.7		135,461		7.2

	$	2,473,824		100.0	$	2,136,888		100.0	$	1,868,689		100.0


	2008					2007					2006
	In			% of Net		In			% of Net		In			% of Net
Segment Earnings	Thousands			Sales		Thousands			Sales		Thousands			Sales

Electrical	$	416,732			19.8	$	352,901			20.0	$	291,280			19.3
Steel Structures		44,336			19.1		42,623			18.7		38,705			17.5
HVAC		25,693			18.5		27,175			19.0		23,859			17.6

Segment earnings		486,761			19.7		422,699			19.8		353,844			18.9
Corporate expense		(41,634	)				(62,768	)				(47,318	)
Depreciation, amortization and share-based compensation		(99,864	)				(70,243	)				(59,761	)
Intangible asset impairment		(32,700	)				—					—
Gain on sale of equity interest		169,684					—					—
Interest expense, net		(43,426	)				(23,521	)				(14,840	)
Other (expense) income, net		(7,737	)				(2,276	)				1,517

Earnings from continuing operations before income taxes	$	431,084				$	263,891				$	233,442

We have three reportable segments: Electrical, Steel Structures and HVAC. We evaluate our business segments primarily on the basis of segment earnings, with segment earnings defined as earnings before corporate expense, depreciation and amortization expense, share-based compensation expense, interest, income taxes and certain other items.

Our segment earnings are significantly influenced by the operating performance of our Electrical segment that accounted for more than 80% of our consolidated net sales and consolidated segment earnings during 2008, 2007, and 2006.

Page 28 of 97

Electrical Segment

Year 2008 Compared with 2007

Our Electrical segment performed well in 2008 despite a challenging environment that included fluctuating commodity costs, competitive pricing pressures and softening demand, especially in our domestic markets. Actions were taken in the last half of 2008 to minimize the impact of the economic downturn as it began to spread beyond the residential-related markets, including a significant reduction in our employee headcount. During 2008, our Electrical segment also integrated four distribution centers from the Lamson & Sessions Co. acquisition into our centralized logistics model.

Electrical segment net sales in 2008 were $2.1 billion, up $336.5 million, or 19.1%, from 2007. Acquisitions completed in 2007 and early 2008 accounted for $314 million of the year-over-year increase in net sales. Price increases in 2008 related to higher commodity and energy costs helped to offset lower underlying sales volumes in the current year. Favorable foreign currency exchange accounted for approximately $17 million of the sales increase.

Electrical segment earnings in 2008 were $416.7 million, up $63.8 million, or 18.1%, from 2007. The improvement in year-over-year segment earnings largely reflects the favorable impact of acquisitions. Price increases in 2008 related to higher commodity and energy costs helped to offset the earnings impact of lower underlying sales volumes.

Year 2007 Compared with 2006

Electrical segment net sales in 2007 were $1.8 billion, up $255.0 million, or 16.9%, from 2006. This increase reflects the impact of acquisitions ($113 million), net volume growth due to strong demand in industrial and construction markets and price increases to offset higher material and energy costs. Favorable foreign currency exchange driven primarily by strong Canadian and European currencies against a weaker U.S. dollar accounted for approximately $42 million of the sales increase.

Electrical segment earnings in 2007 were $352.9 million, up $61.6 million, or 21.1%, from 2006. The earnings improvement reflects higher sales volumes, favorable product mix and our continued success in offsetting increased material and energy cost inflation. Electrical segment earnings also reflect $5 million of earnings from acquisitions, inclusive of acquisition-related amortization totaling $9 million, and approximately $2 million in net expenses related to a plant consolidation.

Other Segments

Year 2008 Compared with 2007

Net sales in 2008 in our Steel Structures segment were $231.6 million, up $4.2 million, or 1.9%, from 2007. Segment earnings in 2008 were $44.3 million, up $1.7 million, or 4.0%, from 2007, primarily reflecting favorable project mix.

Net sales in 2008 in our HVAC segment were $139.1 million, down $3.8 million, or 2.7%, from 2007. HVAC segment earnings in 2008 were $25.7 million, down $1.5 million, or 5.5%, from 2007, primarily due to lower sales volumes.

Page 29 of 97

Year 2007 Compared with 2006

Net sales in 2007 in our Steel Structures segment were $227.4 million, up $5.7 million, or 2.6%, from 2006. Sales in 2007 reflect increased volume of internally manufactured, highly engineered tubular steel poles and decreased shipments of lattice towers purchased from third party suppliers for resale. Lattice tower sales were $4.0 million in 2007 and $23.1 million in 2006. Steel Structures segment earnings in 2007 were $42.6 million, up $3.9 million, or 10.1%, compared to the prior year, driven by increased volume of internally manufactured tubular steel poles and favorable project mix.

Net sales in 2007 in our HVAC segment were $142.9 million, up $7.5 million, or 5.5%, from 2006. HVAC segment earnings in 2007 were $27.2 million, up $3.3 million, or 13.9%, from 2006. Higher sales and improved operating efficiencies contributed to the earnings improvement.

Liquidity and Capital Resources

We had cash and cash equivalents of $292.5 million and $149.9 million at December 31, 2008 and 2007, respectively.

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


(In thousands)	2008			2007			2006

Net cash provided by (used in) operating activities	$	257,861		$	261,360		$	221,168
Net cash provided by (used in) investing activities		224,272			(809,778	)		214,056
Net cash provided by (used in) financing activities		(312,685	)		317,836			(283,253	)
Effect of exchange-rate changes on cash and cash equivalents		(26,880	)		9,540			2,255

Net increase (decrease) in cash and cash equivalents		142,568			(221,042	)		154,226
Cash and cash equivalents, beginning of year		149,926			370,968			216,742

Cash and cash equivalents, end of year	$	292,494		$	149,926		$	370,968

Operating Activities

Cash provided by operating activities was primarily attributable to net earnings of $265.3 million, $183.2 million and $175.1 million in 2008, 2007 and 2006, respectively. Adjustments to 2008 net earnings necessary to reflect underlying cash flows from operations included the $170 million gain on sale of our minority interest in Leviton Manufacturing Company and a $32.7 million non-cash charge for intangible asset impairment. Depreciation and amortization was $80.4 million, $57.8 million and $47.8 million in 2008, 2007 and 2006, respectively. Share-based compensation expense was $19.4 million, $12.5 million and $11.9 million in 2008, 2007 and 2006, respectively. Operating activities in 2008 also reflected the benefit to working capital of a lower level of year-end receivables but were unfavorably impacted by $13.6 million of change in control payments related to the Lamson & Sessions Co. acquisition. In addition to the items described above, cash provided by operating activities in 2008 was negatively impacted by approximately $70 million for income taxes related to divestitures during the year. Operating activities in 2007 reflected $8.8 million in merger-related transaction costs incurred by Lamson & Sessions Co. that were subsequently paid by the Corporation.

Page 30 of 97

Investing Activities

In January 2008, we acquired The Homac Manufacturing Company, a privately held manufacturer of components used in utility distribution and substation markets, as well as industrial and telecommunications markets, for approximately $75 million.

In January 2008, we acquired Boreal Braidings Inc., a privately held Canadian manufacturer of high-quality flexible connectors for approximately $16 million.

In November 2007, we completed our merger with Lamson & Sessions Co. (LMS) for approximately $450 million. LMS is a North American supplier of non-metallic electrical boxes, fittings, flexible conduit and industrial PVC pipe. The merger consideration was obtained through the use of our $750 million credit facility. The LMS acquisition enables us to broaden our existing product portfolio and enhance our market position with distributors and end users of electrical products.

In July 2007, we acquired the Joslyn Hi-Voltage and Power Solutions businesses from Danaher Corporation for approximately $280 million in cash. Joslyn Hi-Voltage offers a broad range of high voltage electric switches, reclosers, vacuum interrupter attachments and related products used mainly by electric utilities. Power Solutions offers a broad range of products and services designed to ensure a high quality, reliable flow of power to commercial and industrial customers for mission critical applications such as data centers.

Also in July 2007, we acquired Drilling Technical Supply SA, a privately held French manufacturer of explosion-proof lighting and electrical protection equipment, for approximately $23 million in cash.

During 2006, acquisitions totaled $34 million and consisted primarily of the purchase of the net operating assets of Hi-Tech Fuses, Inc., which manufactures high-voltage, current-limiting fuses sold primarily for utility applications.

During 2008, we had capital expenditures to support our ongoing business plans totaling $42.1 million compared to $40.7 million in 2007 and $44.3 million in 2006. We expect capital expenditures to be approximately $55 million in 2009.

Financing Activities

Cash used in 2008 financing activities included the repurchase of approximately 5.2 million common shares for $161 million, net repayments of $30 million under our $750 million revolving credit facility and other debt repayments of $124 million. Cash used in 2007 financing activities included the repurchase of approximately 2.5 million common shares for $133 million and net proceeds of $420 million under our $750 million revolving credit facility. Cash used in 2006 financing activities included the repurchase of approximately 3.7 million common shares for $201 million and other debt repayments of $151 million. Financing activities also include cash provided by stock options exercised of $2 million, $25 million and $57 million in 2008, 2007 and 2006, respectively. Financing activities reflect the positive impact of $1 million, $7 million and

Page 31 of 97

$11 million associated with incremental tax effects of share-based payment arrangements in 2008, 2007 and 2006, respectively. Cash flows from operating activities have been reduced by a similar amount in each period for share-based arrangements.

$750 million Credit Facility

In October 2007, we amended and restated our unsecured, senior credit facility. No material changes were made in the amendment process other than increasing the amount of available credit. Our revolving credit facility has total availability of $750 million and a five year term expiring in October 2012. All borrowings and other extensions of credit under our revolving credit facility are subject to the satisfaction of customary conditions, including absence of defaults and accuracy in material respects of representations and warranties. The proceeds of any loans under the revolving credit facility may be used for general operating needs and for other general corporate purposes in compliance with the terms of the facility. At December 31, 2008, $390 million was outstanding under this facility. At December 31, 2007, $420 million was outstanding under this facility.

In 2007, the Corporation entered into an interest rate swap to hedge its exposure to changes in the LIBOR rate on $390 million of borrowings under this facility. See Item 7A.

Under the revolving credit facility agreement, we selected an interest rate on our initial draw of the revolver based on the one-month London Interbank Offered Rate (“LIBOR”) plus a margin based on our debt rating. Fees to access the facility and letters of credit under the facility are based on a pricing grid related to our debt ratings with Moody’s, S&P, and Fitch during the term of the facility.

Our amended and restated revolving credit facility requires that we maintain:


	•	a maximum leverage ratio of 4.00 to 1.00 through December 31, 2008, then a ratio of 3.75 to 1.00 thereafter; and

	•	a minimum interest coverage ratio of 3.00 to 1.00.

It also contains customary covenants that could restrict our ability to: incur additional indebtedness; grant liens; make investments, loans, or guarantees; declare dividends; or repurchase company stock. We do not expect these covenants to restrict our liquidity, financial condition, or access to capital resources in the foreseeable future.

Outstanding letters of credit, which reduced availability under the credit facility, amounted to $11.5 million at December 31, 2008. The letters of credit relate primarily to third-party insurance claims processing.

Other Credit Facilities

We have a EUR 10.0 million (approximately US$14.2 million) committed revolving credit facility with a European bank that has an indefinite maturity. There were no balances outstanding or letters of credit that reduced availability under the European facility at December 31, 2008. This credit facility contains standard covenants similar to those contained in the $750 million credit agreement and standard events of default such as covenant default and cross-default.

We have a CAN 30.0 million (approximately US$24.7 million) committed revolving credit facility with a Canadian bank that matures in 2011. There were no outstanding balances or letters of credit that reduced availability under the Canadian facility at December 31, 2008. This credit facility contains standard covenants similar to those contained in the $750 million credit agreement and standard events of default such as covenant default and cross-default.

Page 32 of 97

Other Letters of Credit

As of December 31, 2008, we also had letters of credit in addition to those discussed above that do not reduce availability under our credit facilities. We had $22.9 million of such additional letters of credit that relate primarily to environmental assurances, third-party insurance claims processing, performance guarantees and acquisition obligations.

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, we could have difficulty replacing those credit facilities or obtaining credit facilities in the future.

As of December 31, 2008, the aggregate availability of funds under our credit facilities is approximately $387.4 million, after deducting outstanding letters of credit. Availability is subject to the satisfaction of various covenants and conditions to borrowing. In addition, we repaid $146.8 million in unsecured notes in February 2009 with $125 million obtained from our $750 million revolving credit facility and the remainder from available cash resources. The aggregate availability of funds under our credit facilities immediately after the February 2009 borrowing of $125 million was approximately $262.8 million, after deducting outstanding letters of credit.

Credit Ratings

As of December 31, 2008, 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 improve, we could potentially have a decrease in our credit costs. The maturity of any of our debt securities does not accelerate in the event of a credit downgrade.

Debt Securities

Thomas & Betts had the following unsecured debt securities outstanding as of December 31, 2008:

Issue Date

Amount

Interest Rate

Interest Payable

Maturity Date

February 1999

146.8 million(a

)

6.39

March 1 and September 1

February 2009

May 2003

125.0 million

7.25

June 1 and December 1

June 2013


(a)		We repaid in February 2009 with $125 million obtained from our $750 million revolving credit facility and the remainder from available cash resources.

The indentures underlying the unsecured 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.

Page 33 of 97

Other

The Corporation utilized its remaining $26 million federal net operating loss carryforwards in 2007 to offset cash taxes related to earnings generated by operations. The Corporation utilized $167 million of its federal net operating loss carryforwards in 2006 primarily to offset cash taxes related to earnings generated by operations and the distribution of cash from a foreign subsidiary.

We do not currently pay cash dividends. Future decisions concerning the payment of cash dividends on the common stock will depend upon our results of operations, financial condition, strategic investment opportunities, continued compliance with credit facilities and other factors that the Board of Directors may consider relevant.

As of December 31, 2008, we have $292 million in cash and cash equivalents and $262.8 million of aggregate availability under our credit facilities immediately after the February 2009 borrowing of $125 million referred to above. We renewed our effective shelf registration with the Securities and Exchange Commission on December 3, 2008, utilizing the well-known seasoned issuer (WKSI) process. The registration permits us to issue common stock, preferred stock and debt securities. The registration is effective for a period of three years from the date of filing. We continue to have cash requirements to, among other things, support working capital and capital expenditure needs, service debt and fund our pension plans as required. We generally intend to use available cash and internally generated funds to meet these cash requirements and may borrow under existing credit facilities or access the capital markets as needed for liquidity. Credit markets in 2008 were materially disrupted, significantly limiting the availability of credit. We cannot predict when credit markets will return to a more normal level of activity. To date, our liquidity has not been adversely affected by the current credit market. We believe that we have sufficient liquidity to satisfy both short-term and long-term requirements.

Off-Balance Sheet Arrangements

As of December 31, 2008, we did not have any off-balance sheet arrangements.

Refer to Note 19 in the Notes to Consolidated Financial Statements for information regarding our guarantee and indemnification arrangements.

Page 34 of 97

Contractual Obligations

The following table reflects our total contractual cash obligations as of December 31, 2008:


						2010		2012
						through		through
(In millions)	Total		2009			2011		2013		Thereafter

Long-Term Debt Including Current Maturities(b)	$	661.0	$	148.8	(a)	$	0.5	$	511.7	$	—
Estimated Interest Payments(c)		106.5		30.6			56.3		19.6		—
Operating Lease Obligations		66.5		16.7			24.8		15.4		9.6

Total Contractual Cash Obligations(d)	$	834.0	$	196.1		$	81.6	$	546.7	$	9.6


(a)		We repaid $146.8 million of unsecured notes in February 2009 with $125 million obtained from our $750 million revolving credit facility and the remainder from available cash resources.

(b)		Includes capital leases.

(c)		Reflects stated interest rates for fixed rate debt (including debt hedged via an interest rate swap) and year-end interest rates for variable rate debt.

(d)		We have liabilities associated with our qualified and non-qualified pension and postretirement benefit plans reflected in our consolidated balance sheet. Future contribution obligations associated with these liabilities are not reflected in the table above due to the absence of scheduled maturities. Therefore, the timing of these payments cannot be determined. In addition, in prior years we have made voluntary tax-deductible contributions to our major qualified pension plans that were not legally required. We expect required contributions to our qualified pension plans in 2009 to be minimal; however, if pension assets do not recover a substantial portion of 2008 investment losses, our required contributions in 2010 will increase significantly.

Credit Risk

We continually evaluate the credit risk associated with our customers. Credit risk with respect to trade receivables is mitigated in part by 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, 2008. See also Risk Factors.

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. With the November 2007 merger of Lamson & Sessions Co., we assumed that company’s qualified pension benefit obligations of approximately $86 million. Our contributions to all qualified pension plans was $2 million in 2008, $2 million in 2007 and $2 million in 2006. We expect required contributions to our qualified pension plans in 2009 to be minimal; however, if pension assets do not recover a substantial portion of 2008 investment losses, our required contributions in 2010 will increase significantly. The following information indicates the funded status for our qualified pension plans:

Page 35 of 97

All qualified pension plans:


	December 31,		December 31,
(In millions)	2008		2007

Benefit obligation	$	441	$	452
Fair value of plan assets	$	320	$	483

Our qualified pension plan assets at December 31, 2008 and 2007, were included in the following asset categories:


	Plan Assets
	December 31,
	2008			2007

Asset Category
Domestic equity securities		37	%		39	%
International equity securities		20	%		21	%
Debt securities		31	%		30	%
Other, including alternative investments		12	%		10	%

Total		100	%		100	%

The financial objectives of our investment policy is (1) to maximize returns in order to minimize contributions and long-term cost of funding pension liabilities, within reasonable and prudent levels of risk, (2) to match liability growth with the objective of fully funding benefits as they accrue and (3) to achieve annualized returns in excess of the policy benchmark. The Corporation’s asset allocation targets are 43% U.S. domestic equity securities, 15% international equity securities, 26% fixed income and high yield debt securities and 16% other, including alternative investments. As of December 31, 2008 and 2007, no pension plan 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:


	2008			2007			2006

Weighted-average long-term rates of return used to determine net periodic pension cost		8.41	%		8.52	%		8.55	%

Reflected in the rates above are domestic weighted-average long-term rates of return of 8.75% for 2008, 2007 and 2006.

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


	2008			2007			2006

Discount rates used to determine net periodic pension cost		6.18	%		5.62	%		5.65	%

Reflected in the rates above are domestic discount rates to determine net periodic pension cost of 6.25% in 2008 and 5.75% in 2007 and 2006.

Page 36 of 97

Discount rates used to determine pension benefit obligations as of December 31, 2008 and 2007 for all qualified pension plans were 6.3% and 6.18%, respectively, and reflect domestic discount rates of 6.25% for 2008 and 2007.

The potential impact on the 2008 net periodic pension cost resulting from a hypotheticalone-percentage-point change in the assumed weighted-average long-term rate of return while maintaining a constant discount rate would be approximately $5 million. The potential impact on the 2008 net periodic pension cost resulting from a hypothetical one-percentage-point increase in the assumed discount rate while maintaining a constant weighted-average long-term rate of return would be a decrease of approximately $2 million, and a hypothetical one-percentage-point decrease in the assumed discount rate while maintaining a constant weighted-average long-term rate of return would be an increase of approximately $5 million.

Effective January 1, 2008, substantially all domestic defined benefit pension plans were closed to new entrants.

For additional information regarding our qualified and non-qualified pension plans and other post-retirement plans, refer to Note 14 in the Notes to Consolidated Financial Statements.

Lamson & Sessions Co. (“LMS”) Restructuring and Integration Plan

Our senior management began assessing and formulating a restructuring and integration plan as of the acquisition date of LMS. Approval by our senior management and Board of Directors occurred during the first quarter of 2008. The objective of the restructuring and integration plan is to achieve operational efficiencies and eliminate duplicative operating costs resulting from the LMS acquisition. We also intend to achieve greater efficiency in sales, marketing, administration and other operational activities. We identified certain liabilities and other costs for restructuring and integration actions. Included in this amount are approximately $14 million of planned severance costs for involuntary termination of approximately 320 employees of LMS and approximately $8 million of lease cancellation costs associated with the closure of LMS distribution centers. Severance and lease cancellation costs reflect cash paid or to be paid for these actions. Integration costs were recognized as incurred and either expensed or capitalized, as appropriate. The amount recognized in 2008 in cost of sales as integration expense was approximately $3 million. The actions required by the plan began soon after the plan was approved, including the communication to affected employees of our intent to terminate as soon as possible.

We ceased operations at all LMS distribution centers during the second quarter of 2008, consolidating these activities into our existing distribution centers. As of December 31, 2008, approximately 290 employees have been involuntary terminated under the plan. Payments associated with certain of the restructuring and integration actions taken are expected to extend beyond 2008 due to compliance with applicable regulations and other considerations. The cash payments necessary to fund the plan are expected to come from operations or available cash resources including restricted cash. Beginning in 2009, annual net savings from these actions are expected to approximate $18 million as a consequence of the reduction in total employment and the consolidation of distributions centers.

During 2008, we completed the sale of the pipe businesses of the held-for-sale operations and the LMS headquarters building that were acquired as part of the LMS acquisition. The net proceeds from these sales totaled approximately $70 million and resulted in a loss of approximately $8 million recorded in discontinued operations. Net proceeds included a note receivable of approximately $4 million that is due in quarterly installments through December 2011.

Page 37 of 97

Recently Issued Accounting Standards

In December 2007, the Financial Accounting Standards Board issued SFAS No. 141 (Revised), “Business Combinations.” SFAS No. 141R replaces SFAS No. 141 while retaining the fundamental requirements in SFAS No. 141 that the acquisition (purchase) method of accounting be used for all business combinations. SFAS No. 141R retains SFAS No. 141 guidance for identifying and recognizing intangible assets separately from goodwill and makes certain changes to how the acquisition (purchase) method is applied. SFAS No. 141R is to be applied prospectively to business combinations for which the acquisition date is after December 31, 2008. SFAS 141R will have an impact on accounting for business combinations once adopted but the effect is dependent upon acquisitions at that time.

Effective January 1, 2008, the Corporation adopted SFAS No. 157, “Fair Value Measurements,” for measuring “financial” assets and liabilities. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. The provisions of SFAS No. 157 related to certain “nonfinancial” assets and liabilities are effective for the Corporation’s financial statements beginning in 2009. We do not believe the impact of adopting SFAS No. 157 will be material.

In December 2007, the Financial Accounting Standards Board issued SFAS No. 160, “Noncontrolling Interest in Consolidated Financial Statements — an amendment of ARB No. 51.” SFAS No. 160 amends ARB No. 51 to establish accounting and reporting standards for the noncontrolling interest (sometimes called a minority interest) in a subsidiary and for the deconsolidation of a subsidiary and to provide consistency with SFAS No. 141. SFAS No. 160 is effective for our financial statements beginning in 2009. We do not believe the impact of adopting SFAS No. 160 will be material.

In March 2008, the Financial Accounting Standards Board issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133.” SFAS No. 161 changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about how and why an entity uses derivative instruments, how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for our financial statements beginning in 2009. We do not believe the impact of adopting SFAS No. 161 will be material.


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, foreign exchange rates and raw material prices. 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

During the fourth quarter of 2007, we entered into a forward-starting interest rate swap for a notional amount of $390 million. The notional amount reduces to $325 million on December 15, 2010, $200 million on December 15, 2011 and $0 on October 1, 2012. The interest rate swap hedges $390 million of our exposure to changes in interest rates on borrowings under our $750 million credit facility. We have designated the interest rate swap as a cash flow hedge for accounting purposes. Under the interest rate swap, we receive variable one-month LIBOR and pay a

Page 38 of 97

fixed rate of 4.86%. As of December 31, 2008, we recorded a swap liability of $39.7 million and a related contra equity amount, net of tax, of $24.4 million in accumulated other comprehensive income. We recognized a $0.1 million benefit to interest expense in 2008 and a $0.5 million charge in 2007 for the ineffective portion of the swap.

The following table reflects our interest rate sensitive derivative financial instruments as of December 31, 2008:

December 31,

Expected Maturity Date

2008

December 31,

Fair Value

(In millions)

2009

2010

2011

2012

2013

(Liability)

Interest Rate Swaps:

Variable to Fixed

$390.0

$325.0

$200.0

$—

$(39.7

)

Average pay rate

4.86%

Average receive rate

1-month
LIBOR

Interest expense, net includes a charge of $0.8 million in 2006 associated with previous interest rate swap agreements that effectively converted certain fixed rate debt to floating rates.

Forward Foreign Exchange Contracts

We had no outstanding forward sale or purchase contracts as of December 31, 2008. During 2007, we entered into currency forward exchange contracts that amortized monthly in 2008. The contracts were not designated as a hedge for accounting purposes. These contracts were intended to reduce cash flow volatility from exchange rate risk related to a short-term intercompany financing transaction. Under the terms of the contracts, we sold U.S. dollars at current spot rates and purchased Canadian dollars at a fixed forward exchange rate. During 2008 and 2007, we recognized a mark-to-market loss of $0.7 million on these contracts and a mark-to-market gain on these contracts of $0.7 million, respectively, that effectively matched foreign exchange gains on the short-term intercompany financing transaction. The currency forward exchange contracts were reflected in the balance sheet at a fair value asset of $0.7 million as of December 31, 2007. During 2006, we had no mark-to-market adjustments for forward foreign exchange contracts.

Commodities Futures Contracts

During 2008, 2007 and 2006, we had no outstanding commodities futures contracts. We are exposed to risk from fluctuating prices for certain materials used to manufacture our 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 has been mitigated through the use of futures contracts that fixed the price we paid for a commodity.

Page 39 of 97


Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX


Consolidated Financial Statements

Management’s Responsibility for Financial Statements			41

Management’s Report on Internal Control Over Financial Reporting			41

Reports of Independent Registered Public Accounting Firm			42

Consolidated Statements of Operations for 2008, 2007 and 2006			45

Consolidated Balance Sheets as of December 31, 2008 and 2007			46

Consolidated Statements of Cash Flows for 2008, 2007 and 2006			47

Consolidated Statements of Shareholders’ Equity and Comprehensive Income for 2008, 2007 and 2006			48

Notes to Consolidated Financial Statements			49

Supplementary Financial Data (Unaudited)			91

Page 40 of 97

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 U.S. generally accepted accounting principles. 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 ofnon-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. Our internal control system is designed to provide reasonable assurance that externally published financial statements can be relied upon and have been prepared in accordance with U.S. generally accepted accounting principles. 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.

Under the supervision of 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 Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 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, 2008. KPMG LLP, the independent registered public accounting firm that audited our consolidated financial statements, has issued an attestation report on our internal control over financial reporting as of December 31, 2008.


/s/ Dominic J. Pileggi Chairman, President and Chief Executive Officer		/s/ Kenneth W. Fluke Senior Vice President and Chief Financial Officer		/s/ William E. Weaver, Jr. Vice President — Controller

Page 41 of 97

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

Thomas & Betts Corporation:

We have audited the accompanying consolidated balance sheets of Thomas & Betts Corporation and subsidiaries (the Corporation) as of December 31, 2008 and 2007, 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, 2008. 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, 2008 and 2007, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2008, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 2 to the consolidated financial statements, effective January 1, 2007, the Corporation adopted FASB Interpretation No. 48,Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement No. 109.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Thomas & Betts Corporation’s internal control over financial reporting as of December 31, 2008, 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 17, 2009 expressed an unqualified opinion on the effectiveness of the Corporation’s internal control over financial reporting.

/s/ KPMG LLP

KPMG LLP

Memphis, Tennessee

February 17, 2009

Page 42 of 97

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

Thomas & Betts Corporation:

We have audited Thomas and Betts Corporation’s (the Corporation) internal control over financial reporting as of December 31, 2008, 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, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Corporation’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, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included 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, Thomas and Betts Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Page 43 of 97

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, 2008 and 2007, 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, 2008, and our report dated February 17, 2009 expressed an unqualified opinion on those consolidated financial statements.

/s/ KPMG LLP

KPMG LLP

Memphis, Tennessee

February 17, 2009

Page 44 of 97

Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share data)


	Years Ended December 31,
	2008			2007			2006

Net sales	$	2,473,824		$	2,136,888		$	1,868,689
Cost of sales		1,697,844			1,475,347			1,298,347

Gross profit		775,980			661,541			570,342
Selling, general and administrative		430,717			371,853			323,577
Intangible asset impairment		32,700			—			—

Earnings from operations		312,563			289,688			246,765
Interest expense, net		(43,426	)		(23,521	)		(14,840	)
Other (expense) income, net		(7,737	)		(2,276	)		1,517
Gain on sale of equity interest		169,684			—			—

Earnings from continuing operations before income taxes		431,084			263,891			233,442
Income tax provision		157,398			80,215			58,312

Net earnings from continuing operations		273,686			183,676			175,130
Loss from discontinued operations, net		(8,355	)		(460	)		—

Net earnings	$	265,331		$	183,216		$	175,130

Basic earnings (loss) per share:
Continuing operations	$	4.84		$	3.17		$	2.90
Discontinued operations		(0.15	)		(0.01	)		—

Net earnings	$	4.69		$	3.16		$	2.90

Diluted earnings (loss) per share:
Continuing operations	$	4.79		$	3.13		$	2.85
Discontinued operations		(0.15	)		(0.01	)		—

Net earnings	$	4.64		$	3.12		$	2.85

Average shares outstanding:
Basic		56,566			57,926			60,434
Diluted		57,159			58,720			61,447

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

Page 45 of 97

Thomas & Betts Corporation and Subsidiaries

Consolidated Balance Sheets

(In thousands)


	As of December 31,
	2008			2007

ASSETS
Current Assets
Cash and cash equivalents	$	292,494		$	149,926
Restricted cash		7,971			16,683
Marketable securities		112			221
Receivables, net of allowances of $91,419 and $85,356		229,160			280,948
Inventories		278,098			271,989
Deferred income taxes		33,983			57,278
Prepaid income taxes		9,090			6,953
Other current assets		15,885			15,439
Assets of discontinued operations		—			106,478

Total Current Assets		866,793			905,915

Property, plant and equipment, net		299,077			305,959
Goodwill		880,410			873,574
Other intangible assets, net		274,672			299,370
Investments in unconsolidated companies		5,050			115,300
Other assets		84,600			67,668

Total Assets	$	2,410,602		$	2,567,786

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Current maturities of long-term debt	$	148,751		$	116,157
Accounts payable		180,750			180,333
Accrued liabilities		138,553			143,606
Income taxes payable		7,947			10,731
Liabilities of discontinued operations		—			18,146

Total Current Liabilities		476,001			468,973

Long-Term Liabilities
Long-term debt, net of current maturities		512,193			695,048
Long-term benefit plan liabilities		185,472			63,066
Deferred income taxes		9,881			48,888
Other long-term liabilities		82,398			62,877
Contingencies (Note 19)
Shareholders’ Equity
Common stock		5,263			5,770
Additional paid-in capital		69,082			207,690
Retained earnings		1,267,295			1,001,997
Accumulated other comprehensive income (loss)		(196,983	)		13,477

Total Shareholders’ Equity		1,144,657			1,228,934

Total Liabilities and Shareholders’ Equity	$	2,410,602		$	2,567,786

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

Page 46 of 97

Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)


	Years Ended December 31,
	2008			2007			2006

Cash Flows from Operating Activities:
Net earnings	$	265,331		$	183,216		$	175,130
Adjustments:
Depreciation and amortization		80,441			57,766			47,842
Intangible asset impairment		32,700			—			—
Share-based compensation expense		19,423			12,477			11,919
Deferred income taxes		(10,257	)		6,672			2,031
Incremental tax benefits from share-based payment arrangements		(611	)		(7,192	)		(11,320	)
Gain on sale of equity interest		(169,684	)		—			—
Loss on sale of divested business		8,067			—			—
Changes in operating assets and liabilities, net:
Receivables		44,997			6,541			(11,441	)
Inventories		(2,981	)		14,961			(15,927	)
Accounts payable		9,337			(24,716	)		3,534
Accrued liabilities		(14,765	)		6,755			(6,841	)
Income taxes payable		6,575			15,666			8,163
Lamson & Sessions change in control payments		(13,556	)		—			—
Merger-related transaction costs incurred by Lamson & Sessions		—			(8,803	)		—
Other		2,844			(1,983	)		18,078

Net cash provided by (used in) operating activities		257,861			261,360			221,168

Cash Flows from Investing Activities:
Purchases of property, plant and equipment		(42,094	)		(40,713	)		(44,345	)
Purchases of businesses, net of cash acquired		(90,571	)		(752,912	)		(34,031	)
Proceeds from sale of equity interest, net		280,000			—			—
Proceeds from sale of businesses, net		65,378			—			—
Restricted cash (established) used for change in control payments		8,712			(16,683	)		—
Proceeds from sale of property, plant and equipment		2,758			373			659
Marketable securities acquired		—			(48	)		(121,665	)
Proceeds from marketable securities		89			205			413,438

Net cash provided by (used in) investing activities		224,272			(809,778	)		214,056

Cash Flows from Financing Activities:
Repurchase of common shares		(161,461	)		(132,958	)		(200,796	)
Revolving credit facility proceeds (repayments), net		(30,000	)		420,000			—
Repayment of debt and other borrowings		(123,718	)		(1,016	)		(150,896	)
Stock options exercised		1,883			24,618			57,119
Incremental tax benefits from share-based payment arrangements		611			7,192			11,320

Net cash provided by (used in) financing activities		(312,685	)		317,836			(283,253	)

Effect of exchange-rate changes on cash and cash equivalents		(26,880	)		9,540			2,255

Net increase (decrease) in cash and cash equivalents		142,568			(221,042	)		154,226
Cash and cash equivalents, beginning of year		149,926			370,968			216,742

Cash and cash equivalents, end of year	$	292,494		$	149,926		$	370,968

Cash payments for interest	$	47,569		$	33,329		$	33,016
Cash payments for income taxes	$	154,510		$	54,916		$	44,896

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

Page 47 of 97

Thomas & Betts Corporation and Subsidiaries

Consolidated Statements of Shareholders’ Equity and Comprehensive Income

(In thousands)


																Accumulated
																Other
							Additional						Nonvested			Comprehensive			Comprehensive
	Common Stock						Paid-In			Retained			Restricted			Income			Income
	Shares			Amount			Capital			Earnings			Stock			(Loss)			(Loss)			Total

Balance at December 31, 2005		61,089		$	6,109		$	411,985		$	643,651		$	(2,098	)	$	(7,057	)				$	1,052,590

Net earnings		—			—			—			175,130			—			—		$	175,130			175,130
Other comprehensive income (loss):
Cumulative translation adjustment		—			—			—			—			—			—			18,411			18,411
Unrealized gain (loss) on marketable securities		—			—			—			—			—			—			(10	)		(10	)
Minimum pension liability		—			—			—			—			—			—			821			821

Other comprehensive income		—			—			—			—			—			19,222			19,222			—

Comprehensive income		—			—			—			—			—			—		$	194,352			—

Repurchase of common shares		(3,668	)		(367	)		(200,429	)		—			—			—						(200,796	)
Stock options and incentive awards		2,052			198			56,895			—			—			—						57,093
Share-based compensation		—			—			12,196			—			—			—						12,196
Tax benefits realized from share-based payment arrangements		—			—			15,937			—			—			—						15,937
Adoption of SFAS No. 123R		—			(16	)		(2,082	)		—			2,098			—						—
Adoption of SFAS No. 158		—			—			—			—			—			(63,013	)					(63,013	)

Balance at December 31, 2006		59,473		$	5,924		$	294,502		$	818,781		$	—		$	(50,848	)				$	1,068,359

Net earnings		—			—			—			183,216			—			—		$	183,216			183,216
Other comprehensive income (loss):
Cumulative translation adjustment		—			—			—			—			—			—			52,515			52,515
Unrealized gain (loss) on marketable securities		—			—			—			—			—			—			(3	)		(3	)
Unrealized gain (loss) on interest rate swap		—			—			—			—			—			—			(8,141	)		(8,141	)
Defined benefit pension and other post retirement plans		—			—			—			—			—			—			19,954			19,954

Other comprehensive income		—			—			—			—			—			64,325			64,325			—

Comprehensive income		—			—			—			—			—			—		$	247,541			—

Repurchase of common shares		(2,531	)		(253	)		(132,705	)		—			—			—						(132,958	)
Stock options and incentive awards		1,046			99			24,557			—			—			—						24,656
Share-based compensation		—			—			12,444			—			—			—						12,444
Tax benefits realized from share-based payment arrangements		—			—			8,892			—			—			—						8,892

Balance at December 31, 2007		57,988		$	5,770		$	207,690		$	1,001,997		$	—		$	13,477					$	1,228,934

Net earnings		—			—			—			265,331			—			—		$	265,331			265,331
Other comprehensive income (loss):
Cumulative translation adjustment		—			—			—			—			—			—			(104,355	)		(104,355	)
Unrealized gain (loss) on interest rate swap		—			—			—			—			—			—			(16,263	)		(16,263	)
Defined benefit pension and other post retirement plans		—			—			—			—			—			—			(89,842	)		(89,842	)

Other comprehensive loss		—			—			—			—			—			(210,460	)		(210,460	)		—

Comprehensive income		—			—			—			—			—			—		$	54,871			—

Repurchase of common shares		(5,224	)		(522	)		(160,939	)		—			—			—						(161,461	)
Stock options and incentive awards		525			15			1,910			—			—			—						1,925
Share-based compensation		—			—			19,824			—			—			—						19,824
Tax benefits realized from share-based payment arrangements		—			—			597			—			—			—						597
SFAS No. 158 measurement date adjustment		—			—			—			(33	)		—			—						(33	)

Balance at December 31, 2008		53,289		$	5,263		$	69,082		$	1,267,295		$	—		$	(196,983	)				$	1,144,657

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 48 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


1.	Nature of Operations

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

The Corporation sells its products through the following channels: 1) electrical, utility, telephone, cable, and heating, ventilation and air-conditioning distributors; 2) through mass merchandisers, catalog merchandisers and home improvement centers; and 3) directly to original equipment manufacturers, utilities and certain end-users.


2.	Summary of Significant Accounting Policies

Basis of Presentation: The consolidated financial statements include the accounts of the Corporation and its controlled domestic and foreign subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. When appropriate, (1) the equity method of accounting is used for investments in non-controlled affiliates in which the Corporation’s ownership ranges from 20 to 50 percent, or in instances in which the Corporation is able to exercise significant influence, but not control, (2) the Corporation consolidates all investments in affiliates, which are not considered variable interest entities, in which the Corporation’s ownership exceeds 50 percent or where the Corporation has control, and (3) the Corporation provides for minority interests in consolidated subsidiaries for which the Corporation’s ownership is less than 100 percent.

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 U.S. generally accepted accounting principles (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. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates.

Cash and Cash Equivalents: Cash equivalents consist of high-quality money market investments and other investments with maturities at the date of purchase of less than 90 days that have a low risk of change in value. 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.

Revenue Recognition: The Corporation recognizes revenue when products are shipped and the customer takes ownership and assumes risk of loss, collection of the relevant receivable is probable,

Page 49 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


2.	Summary of Significant Accounting Policies (Continued)

persuasive evidence of an arrangement exists and the sales price is fixed or determinable. The Corporation also recognizes revenue for service agreements over the applicable service periods. Sales discounts, quantity and price rebates, and allowances are estimated based on contractual commitments and experience and recorded as a reduction of 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 allowances for doubtful accounts when credit losses are both probable and estimable. 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.

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 (loss). Where the transaction currency differs from the functional currency, translation adjustments are recorded in income.

Credit Risk: Credit risk with respect to trade receivables is not highly concentrated as a large number of customers comprise the Corporation’s customer base and they are dispersed 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: The Corporation follows the provisions of Statement of Financial Accounting Standard (SFAS) No. 141, “Business Combinations.” SFAS No. 141 requires that all business combinations be accounted for under the purchase method of accounting. Under SFAS No. 141, all assets and liabilities acquired in a business combination, including goodwill, indefinite-lived intangibles and other intangibles, are recorded at fair value. The initial recording of goodwill and other intangibles requires subjective judgments concerning estimates of the fair value of the acquired assets and liabilities. Goodwill consists principally of the excess of cost over the fair value of net assets acquired in business combinations and is not amortized. Other intangible assets as of December 31, 2008 and 2007, include identifiable intangible assets with indefinite lives totaling approximately $83 million and $102 million, respectively, and identifiable

Page 50 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


2.	Summary of Significant Accounting Policies (Continued)

intangible assets with finite lives totaling approximately $192 million and $198 million, respectively. Intangible assets with indefinite lives are not amortized and intangible assets with finite lives are amortized over periods ranging from 1 to 15 years. For each amortizable intangible asset, the Corporation uses a method of amortization that reflects the pattern in which the economic benefits of the intangible asset are consumed. If that pattern cannot be reliably determined, the straight-line amortization method is used.

The Corporation also 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 as of the beginning of the fourth quarter of each year, unless circumstances dictate more frequent interim assessments. In evaluating when an interim assessment is necessary, the Corporation considers, among other things, the trading level of the Corporation’s common stock, changes in expected future cash flows and mergers and acquisitions involving companies in its industry.

Under the provisions of SFAS No. 142, each test of goodwill requires us to determine the fair value of each reporting unit and compare the fair value to the reporting unit’s carrying amount. SFAS No. 142 defines a reporting unit as an operating segment or one level below an operating segment. The Corporation determines the fair value of its reporting units using a combination of three valuation methods: market multiple approach; discounted cash flow approach; and comparable transactions approach. The market multiple approach provides indications of value based on market multiples for public companies involved in similar lines of business. The discounted cash flow approach calculates the present value of projected future cash flows using appropriate discount rates. The comparable transactions approach provides indications of value based on an examination of recent transactions in which companies in similar lines of business were acquired. The fair values derived from these three valuation methods are then blended to arrive at a single value for each reporting unit. The Corporation’s determination of fair values as of the beginning of the fourth quarter of 2008 involved a weighting of 25% to the market multiple approach, 50% to the discounted cash flow approach and 25% to the comparable transactions approach. The Corporation then reconciles the total values for all reporting units to its market capitalization and evaluate the reasonableness of the implied control premium.

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.

The Corporation’s annual assessment as of the beginning of the fourth quarter of 2008 of intangible assets with indefinite lives concluded that the fair value of such assets in the Electrical segment were impaired by $32.7 million. Additionally, the Corporation’s annual assessment as of the

Page 51 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


2.	Summary of Significant Accounting Policies (Continued)

beginning of the fourth quarter of 2008 concluded that there was no impairment of goodwill. Circumstances subsequent to the 2008 annual assessment did not warrant the Corporation performing an interim review of goodwill or indefinite-lived intangible assets. See Note 8.

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 beheld-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 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 dispose.

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 requires an evaluation of asset realizability based on a more-likely-than-not criteria.

The Corporation’s policy is to record interest and penalties associated with the underpayment of income taxes as a component of income tax expense.

On January 1, 2007, the Corporation adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (FIN 48). Beginning with the adoption of FIN 48, the Corporation recognizes the effect of income tax positions only if those positions are more-likely-than-not of being sustained.

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 Other 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, “Employers’ Accounting for Pensions” and SFAS No. 88, “Employers’ Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits.” These 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. Effective January 1, 2008, substantially all domestic defined benefit pension plans are closed to new entrants. The Corporation discloses information about its pension plans and other postretirement benefit plans in accordance

Page 52 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


2.	Summary of Significant Accounting Policies (Continued)

with SFAS No. 132 (Revised), “Employers’ Disclosures about Pensions and Other Postretirement Benefits.”

The Corporation provides certain health-care and life insurance benefits to certain retired employees. The Corporation follows the provisions of SFAS No. 106, “Employers’ 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.

The Corporation follows the recognition and disclosure provisions of SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans.” SFAS No. 158 requires the Corporation to record the overfunded or underfunded status of benefit plans on its balance sheet. Changes in funded status are required to be recognized through comprehensive income in the year in which the change occurs. The December 31, 2006 adoption of SFAS No. 158 resulted in a decrease in accumulated other comprehensive income of $63 million. Effective December 31, 2008, SFAS No. 158 also requires the use of the Corporation’s December 31 fiscal year end to account for the Corporation’s pension and other postretirement plans. The impact of eliminating the use of an earlier measurement date for certain of the Corporation’s pension plans resulted in a decrease in retained earnings of $33 thousand.

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 potential dilution from stock options and nonvested restricted stock, using the treasury stock method.

Share-Based Payment Arrangements: The Corporation follows the provisions of SFAS No. 123 (Revised), “Share-Based Payment,” which requires all share-based payments to employees to be recognized as compensation expense in financial statements based on their fair values over the requisite service period. Under the provisions of SFAS No. 123R, non-employee members of the Board of Directors are deemed to be employees.

Fair Value Measurements: Effective January 1, 2008, the Corporation adopted SFAS No. 157, “Fair Value Measurements,” for measuring “financial” assets and liabilities. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. The provisions of SFAS No. 157 related to certain “nonfinancial” assets and liabilities are effective for the Corporation’s financial statements beginning in 2009. The Corporation believes the impact of this remaining requirement will be immaterial.

Derivative Instruments and Hedging Activities: The Corporation follows the provisions of SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities,” as amended. SFAS No. 133 requires entities to recognize all derivative instruments as either assets or liabilities in the balance sheet at fair value. Changes in fair value of derivatives are recorded currently in earnings unless specific hedge accounting criteria are met. For derivatives that qualify as cash flow hedges, the effective portion of changes in fair value of the derivative is reported in accumulated other comprehensive income and the ineffective portion is recognized in earnings in the current period. For

Page 53 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


2.	Summary of Significant Accounting Policies (Continued)

derivatives that qualify as fair value hedges, the changes in fair value of both the derivative instrument and the hedged item are recorded in earnings. The Corporation formally assesses both at inception of the hedge and on an ongoing basis, whether each derivative is highly effective in offsetting changes in fair values or cash flows of the hedged item. If it is determined that a derivative is not highly effective, the Corporation will discontinue hedge accounting prospectively.

Recently Issued Accounting Standards:

Effective January 1, 2008, the Corporation adopted SFAS No. 157, “Fair Value Measurements,” for measuring “financial” assets and liabilities. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. The provisions of SFAS No. 157 related to certain “nonfinancial” assets and liabilities are effective for the Corporation’s financial statements beginning in 2009. The Corporation does not believe the impact of adopting SFAS No. 157 will be material.

In December 2007, the Financial Accounting Standards Board issued SFAS No. 160, “Noncontrolling Interest in Consolidated Financial Statements — an amendment of ARB No. 51.” SFAS No. 160 amends ARB No. 51 to establish accounting and reporting standards for the noncontrolling interest (sometimes called a minority interest) in a subsidiary and for the deconsolidation of a subsidiary and to provide consistency with SFAS No. 141. SFAS No. 160 is effective for the Corporation’s financial statements beginning in 2009. The Corporation does not believe the impact of adopting SFAS No. 160 will be material.

In March 2008, the Financial Accounting Standards Board issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133.” SFAS No. 161 changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about how and why an entity uses derivative instruments, how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for the Corporation’s financial statements beginning in 2009. The Corporation does not believe the impact of adopting SFAS No. 161 will be material.


3.	Acquisitions

The Corporation completed two acquisitions in 2008: The Homac Manufacturing Company and Boreal Braidings Inc.

Page 54 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


3.	Acquisitions (Continued)

The following is supplemental cash flow information regarding the Corporation’s acquisitions in 2008:


(In millions)

Fair value of assets acquired	$	122
Less liabilities assumed		(30	)

Net assets acquired		92
Less cash acquired		(1	)

Purchases of businesses, net of cash acquired	$	91

2008

The Homac Manufacturing Company

In January 2008, the Corporation acquired The Homac Manufacturing Company, a privately held manufacturer of components used in utility distribution and substation markets, as well as industrial and telecommunications markets, for approximately $75 million. The purchase price allocation resulted in goodwill of approximately $23 million and other intangible assets of approximately $25 million, all of which was assigned to the Corporation’s Electrical segment. The results of these operations have been included in the consolidated financial statements of the Corporation since the acquisition date.

Boreal Braidings Inc.

In January 2008, the Corporation acquired Boreal Braidings Inc., a privately held Canadian manufacturer of high-quality flexible connectors for approximately $16 million. The purchase price allocation resulted in goodwill of approximately $7 million and other intangible assets of approximately $8 million, all of which was assigned to the Corporation’s Electrical segment. The results of these operations have been included in the consolidated financial statements of the Corporation since the acquisition date.

2007

The Corporation completed four acquisitions in 2007: Lamson & Sessions Co., JoslynHi-Voltage, Power Solutions and Drilling Technical Supply SA.

The following is supplemental cash flow information regarding the Corporation’s acquisitions in 2007:


(In millions)

Fair value of assets acquired	$	1,000
Less liabilities assumed		(240	)

Net assets acquired		760
Less cash acquired		(7	)

Purchases of businesses, net of cash acquired	$	753

Page 55 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


3.	Acquisitions (Continued)

Lamson & Sessions Co.

The merger of Lamson & Sessions Co. (“LMS” or “Lamson & Sessions”) into Thomas & Betts Corporation was completed in November 2007 for approximately $450 million. LMS is a North American supplier of non-metallic electrical boxes, fittings, flexible conduit, and PVC and HDPE pipe. The LMS acquisition broadened the Corporation’s existing product portfolio and enhanced its market position with distributors and end users of electrical products. As a result of the merger, LMS became a wholly-owned subsidiary of Thomas & Betts Corporation. Thomas & Betts Corporation funded the LMS acquisition through the use of its $750 million revolving credit facility. The results of these operations have been included in the consolidated financial statements of the Corporation since the acquisition date.

The following table summarizes the fair values for the assets acquired and liabilities assumed at the date of acquisition:


(In millions)

Current assets (primarily receivables and inventories)	$	153
Property, plant and equipment		63
Long-term assets		16
Goodwill and other intangible assets		408

Total assets acquired		640
Current liabilities		(80	)
Long-term liabilities		(105	)

Net assets acquired	$	455

Of the $408 million of goodwill and other intangible assets, approximately $60 million has been assigned to intangible assets with infinite lives (consisting of trade/brand names) and approximately $123 million has been assigned to intangible assets with estimated lives ranging up to 11 years (consisting primarily of customer relationships). Goodwill and other intangible assets are not deductible for tax purposes. All of the goodwill and other intangible assets have been assigned to the Corporation’s Electrical segment.

The Corporation decided to divest its rigid polyvinyl chloride (PVC) and high-density polyethylene (HDPE) conduit, duct and pressure pipe businesses, which were acquired as part of the LMS acquisition. The Corporation retained a financial advisor to assist with the sale of these operations. The operations associated with these businesses since the date of acquisition have been reflected as discontinued operations in the accompanying consolidated statements of operations and the assets and liabilities associated with these businesses, as applicable, were reflected asheld-for-sale in the accompanying consolidated balance sheet as of December 31, 2007. During the third quarter of 2008, the Corporation completed the sale of the PVC pipe portion of these operations and the LMS headquarters building, and, during the fourth quarter of 2008, the Corporation completed the sale of the HDPE portion of these operations. The net proceeds from these sales totaled approximately $70 million, which included a note receivable of approximately $4 million that is due in quarterly installments through December 2011. These sales resulted in a loss of $8.1 million that was recorded in discontinued operations. Discontinued operations in 2008

Page 56 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


3.	Acquisitions (Continued)

reflected net sales of approximately $164 million, loss before income taxes of $12.9 million, income tax benefit of $4.5 million and net loss of $8.4 million. Discontinued operations in 2007 reflected net sales of approximately $32 million, loss before income taxes of $0.7 million, income tax benefit of $0.2 million and net loss of $0.5 million. As of December 31, 2008, all LMS held-for-sale net assets have been sold.

The Corporation’s senior management began assessing and formulating a restructuring and integration plan as of the acquisition date of LMS. Approval of the plan by the Corporation’s senior management and Board of Directors occurred during the first quarter of 2008. The objective of the restructuring and integration plan is to achieve operational efficiencies and eliminate duplicative operating costs resulting from the LMS acquisition. The Corporation also intends to achieve greater efficiency in sales, marketing, administration and other operational activities. The Corporation identified certain liabilities and other costs for restructuring and integration actions. Included in this amount are approximately $14 million of planned severance costs for involuntary termination of approximately 320 employees of LMS and approximately $8 million of lease cancellation costs associated with the closure of LMS distribution centers, which have been recorded as part of the Corporation’s purchase price allocation of LMS. Severance and lease cancellation costs have been reflected in the Corporation’s balance sheet in accrued liabilities and reflect cash paid or to be paid for these actions. Integration costs were recognized as incurred and either expensed or capitalized, as appropriate. The amount recognized in cost of sales as integration expense during 2008 was approximately $3 million. The actions required by the plan began soon after the plan was approved, including the communication to affected employees of the Corporation’s intent to terminate as soon as possible.

The Corporation ceased operations at all LMS distribution centers during the second quarter of 2008, consolidating these activities into its existing distribution centers. As of December 31, 2008, approximately 290 employees have been involuntarily terminated under the plan. Payments associated with certain of the restructuring and integration actions taken are expected to extend beyond 2008 due to compliance with applicable regulations and other considerations. The cash payments necessary to fund the plan are expected to come from operations or available cash resources including restricted cash.

Activities related to the LMS accrual for restructuring during the year ended December 31, 2008 are as follows:


	Work Force			Facility
(In millions)	Reductions			Closures			Total

Balance at December 31, 2007	$	—		$	—		$	—
Restructuring accrual additions		14.3			7.6			21.9
Cost/payments charged against reserves		(5.2	)		(2.5	)		(7.7	)

Balance at December 31, 2008	$	9.1	(a)	$	5.1		$	14.2


(a)		A substantial portion of this balance will be satisfied through the use of restricted cash on-hand as of December 31, 2008.

Page 57 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


3.	Acquisitions (Continued)

Joslyn Hi-Voltage and Power Solutions

In July 2007, the Corporation acquired the Joslyn Hi-Voltage and Power Solutions businesses from Danaher Corporation for $282 million in cash. The results of these operations have been included in the consolidated financial statements of the Corporation since the acquisition date. Joslyn Hi-Voltage offers a broad range of high voltage vacuum interrupter attachments, electric switches, reclosers, and related products used mainly by electric utilities. Joslyn Hi-Voltage provides the Corporation with a strong utility market position in specialty hi-voltage overhead power distribution products that complement its underground product portfolio. Power Solutions offers a broad range of products and services designed to ensure a high quality, reliable flow of power to commercial and industrial customers for mission critical applications such as data centers. Power Solutions enables us to develop a niche business platform in energy management and controls that has favorable long-term growth prospects.

The following table summarizes fair values for the assets acquired and liabilities assumed at the date of acquisition:


(In millions)

Current assets (primarily receivables and inventories)	$	52
Property, plant and equipment		8
Long-term assets		7
Goodwill and other intangible assets		251

Total assets acquired		318
Current liabilities		(35	)
Long-term liabilities		(1	)

Net assets acquired	$	282

Of the $251 million of goodwill and other intangible assets, approximately $36 million has been assigned to intangible assets with infinite lives (consisting of trade/brand names) and approximately $64 million has been assigned to intangible assets with estimated lives up to 12 years (consisting primarily of customer relationships). Additionally, approximately $1 million was assigned to in-process research and development assets and expensed as of the acquisition date. Goodwill and other intangible assets are expected to be deductible for tax purposes. The write-off of in-process research and development assets was included in selling, general and administrative expenses in the Corporation’s 2007 consolidated statements of operations. All of the goodwill and other intangible assets have been assigned to the Corporation’s Electrical segment.

Drilling Technical Supply SA

In July 2007, the Corporation acquired Drilling Technical Supply SA, a privately held French manufacturer of explosion-proof lighting and electrical protection equipment, for approximately $23 million in cash. The purchase price allocation resulted in goodwill of approximately $11 million and other intangible assets of approximately $9 million, all of which was assigned to the Corporation’s Electrical segment.

Page 58 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


3.	Acquisitions (Continued)

2006

Acquisitions totaled $34 million in cash and consisted primarily of the purchase of net operating assets of Hi-Tech Fuses, Inc. in August 2006. Hi-Tech Fuses manufactures high-voltage, current-limiting fuses sold primarily for utility applications. The purchase price allocations resulted in goodwill of approximately $18 million and other intangible assets of approximately $12 million, all of which was assigned to the Electrical segment.


4.	Basic and Diluted Earnings Per Share

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


(In thousands, except per share data)	2008			2007			2006

Net earnings from continuing operations	$	273,686		$	183,676		$	175,130
Loss from discontinued operations, net		(8,355	)		(460	)		—

Net earnings	$	265,331		$	183,216		$	175,130

Basic shares:
Average shares outstanding		56,566			57,926			60,434

Basic earnings (loss) per share:
Continuing operations	$	4.84		$	3.17		$	2.90
Discontinued operations		(0.15	)		(0.01	)		—

Net earnings	$	4.69		$	3.16		$	2.90

Diluted shares:
Average shares outstanding		56,566			57,926			60,434
Additional shares on the potential dilution from stock options and nonvested restricted stock		593			794			1,013

		57,159			58,720			61,447

Diluted earnings (loss) per share:
Continuing operations	$	4.79		$	3.13		$	2.85
Discontinued operations		(0.15	)		(0.01	)		—

Net earnings	$	4.64		$	3.12		$	2.85

The Corporation had stock options that were out-of-the-money which were excluded because of their anti-dilutive effect. Such out-of-the-money options related to 1,574,000 shares of common stock in 2008, 265,000 shares in 2007 and 501,000 shares in 2006.


5.	Gain on Sale of Equity Interest

In 1994, the Corporation purchased a minority interest in Leviton Manufacturing Company (“Leviton”), a leading U.S. manufacturer of wiring devices. During the second quarter of 2008, the Corporation sold its entire minority interest back to Leviton for net proceeds of $280 million. Net proceeds reflect $300 million from Leviton, which was offset in part by a $20 million contingent payment triggered by the sale of shares. The transaction resulted in a pre-tax gain of approximately $170 million. In the event of any subsequent sale of Leviton shares within the next three years at a price per share higher than the value reflected in this transaction, Leviton has agreed to pay the Corporation its pro-rata share of the excess.

Page 59 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


6.	Inventories

The following table reflects inventories at December 31, 2008 and 2007:


(In thousands)	2008		2007

Finished goods	$	134,589	$	133,445
Work-in-process		28,595		34,564
Raw materials		114,914		103,980

Total inventories	$	278,098	$	271,989


7.	Property, Plant and Equipment

The following table reflects property, plant and equipment at December 31, 2008 and 2007:


(In thousands)	2008		2007

Land	$	22,083	$	20,707
Building		194,887		200,544
Machinery and equipment		686,985		680,864
Construction-in-progress		14,179		13,829

Gross property, plant and equipment		918,134		915,944
Less: Accumulated depreciation		619,057		609,985

Net property, plant and equipment	$	299,077	$	305,959


8.	Goodwill and Other Intangible Assets

The following table reflects activity for goodwill by segment during the three years ended December 31, 2008:


					Other —
	Balance at				Primarily			Balance at
	Beginning of				Currency			End of
(In thousands)	Year		Additions		Translation			Year

2008
Electrical	$	808,099	$	49,955	$	(43,106	)	$	814,948
Steel Structures		64,759		—		—			64,759
HVAC		716		—		(13	)		703

	$	873,574	$	49,955	$	(43,119	)	$	880,410

2007
Electrical	$	424,802	$	367,018	$	16,279		$	808,099
Steel Structures		64,759		—		—			64,759
HVAC		649		—		67			716

	$	490,210	$	367,018	$	16,346		$	873,574

2006
Electrical	$	397,465	$	18,265	$	9,072		$	424,802
Steel Structures		64,759		—		—			64,759
HVAC		586		—		63			649

	$	462,810	$	18,265	$	9,135		$	490,210

Page 60 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


8.	Goodwill and Other Intangible Assets (Continued)

The following table reflects activity for other intangible assets during the three years ended December 31, 2008:


												Other —
	Balance at											Primarily			Balance at
	Beginning of					Impairment			Amortization			Translation			End of
(In thousands)	Year			Additions		Charges			Expense			Adjustment			Year

2008
Intangible assets subject to amortization	$	206,363		$	21,924	$	—		$	—		$	(1,535	)	$	226,752
Accumulated amortization		(8,636	)		—		—			(26,582	)		333			(34,885	)

		197,727			21,924		—			(26,582	)		(1,202	)		191,867
Other Intangible assets not subject to amortization		101,643			14,034		(32,700	)		—			(172	)		82,805

Total	$	299,370		$	35,958	$	(32,700	)	$	(26,582	)	$	(1,374	)	$	274,672

2007
Intangible assets subject to amortization	$	12,607		$	193,212	$	—		$	—		$	544		$	206,363
Accumulated amortization		(620	)		—		—			(8,004	)		(12	)		(8,636	)

		11,987			193,212		—			(8,004	)		532			197,727
Other Intangible assets not subject to amortization		4,841			96,298		—			—			504			101,643

Total	$	16,828		$	289,510	$	—		$	(8,004	)	$	1,036		$	299,370

2006
Intangible assets subject to amortization	$	299		$	12,298	$	—		$	—		$	10		$	12,607
Accumulated amortization		(172	)		—		—			(438	)		(10	)		(620	)

		127			12,298		—			(438	)		—			11,987
Other Intangible assets not subject to amortization		4,370			—		—			—			471			4,841

Total	$	4,497		$	12,298	$	—		$	(438	)	$	471		$	16,828

The Corporation’s annual assessment as of the beginning of the fourth quarter of 2008 of intangible assets with indefinite lives concluded that the fair value associated with certain trade name intangible assets in the Electrical segment were impaired by $32.7 million. This charge reflects the impact of revised future revenue assumptions, driven by the current economic environment, used to value trade name intangible assets, primarily for Lamson & Sessions Co.

Page 61 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


8.	Goodwill and Other Intangible Assets (Continued)

The following table reflects other intangible assets at December 31, 2008, 2007 and 2006:


									Weighted
									Average
	Gross			Accumulated			Net		Amortization
(In thousands)	Amount			Amortization			Amount		Period

2008
Other Intangible assets subject to amortization:
Customer Relationships	$	210,224		$	(26,690	)	$	183,534		11 years
Other		16,528			(8,195	)		8,333		6 years

Total	$	226,752		$	(34,885	)		191,867

Other Intangible assets not subject to amortization:
Trade Names								80,968
Other								1,837

Total								82,805

Total other intangible assets							$	274,672

2007
Other Intangible assets subject to amortization:
Customer Relationships	$	186,530		$	(4,045	)	$	182,485		11 years
Other		19,833			(4,591	)		15,242		5 years

Total	$	206,363	��	$	(8,636	)		197,727

Other Intangible assets not subject to amortization:
Trade Names								99,772
Other								1,871

Total								101,643

Total other intangible assets							$	299,370

2006
Other Intangible assets subject to amortization:
Customer Relationships	$	8,900		$	(205	)	$	8,695		15 years
Other		3,707			(415	)		3,292		6 years

Total	$	12,607		$	(620	)		11,987

Other Intangible assets not subject to amortization:
Trade Names								3,146
Other								1,695

Total								4,841

Total other intangible assets							$	16,828

Amortization of other intangible assets is included in selling, general and administrative expenses in the Corporation’s consolidated statements of operations.

Amortization expense estimates for each of the five years subsequent to 2008 are as follows:


(In millions)

2009	$	26
2010		26
2011		24
2012		22
2013		20

Page 62 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes

Overview

The Corporation’s income tax provisions for 2008, 2007 and 2006 were $157.4 million (effective rate of 36.5%), $80.2 million (effective rate of 30.4%), and $58.3 million (effective rate of 25.0%), respectively. Both 2008 and 2006 effective tax rates reflect significant income tax adjustments as discussed below. The increase in the 2008 effective rate over 2007 also reflects the impact on domestic pre-tax earnings of the gain on sale of the minority equity interest in Leviton Manufacturing Company. The effective rate for all periods reflects benefits from the Corporation’s Puerto Rican manufacturing operations, which has a significantly lower effective tax rate than the Corporation’s overall blended tax rate.

The 2008 income tax provision included a $14.0 million out-of-period, non-cash charge to establish a deferred federal income tax liability on state net operating loss and state income tax credit carryforwards incurred in periods prior to January 1, 2008. As these carryforwards are subsequently recognized for state income tax purposes, the associated deferred federal income tax liability and the income tax provision will be reduced.

The Corporation recorded an income tax benefit of $36.5 million in 2006 relating to the release of state income tax valuation allowances. Management determined, in accordance with SFAS No. 109, it is more-likely-than-not that sufficient taxable income will be generated in the future to realize the remaining net state deferred tax assets.

Also during 2006, the Corporation recorded an income tax provision of $31.9 million as a result of the distribution of approximately $100 million from a foreign subsidiary. No significant net cash taxes resulted from the distribution due to the use of net operating losses.

Undistributed earnings of foreign subsidiaries amounted to $425 million at December 31, 2008. These earnings are considered to be indefinitely reinvested, and, accordingly, no provision for U.S. federal or state income taxes has been made.

Earnings from continuing operations before income taxes and income tax provision recorded by the Corporation in 2008, 2007 and 2006 is as follows:


	Pretax				Tax
(In thousands)	Earnings		Tax Provision		Rate

2008	$	431,084	$	157,398		36.5	%
2007	$	263,891	$	80,215		30.4	%
2006	$	233,442	$	58,312		25.0	%

Discontinued operations in 2008 reflected a loss before income taxes of $12.9 million, an income tax benefit of $4.5 million (effective rate of 35%) and net loss of $8.4 million. Discontinued operations in 2007 reflected loss before income taxes of $0.7 million, an income tax benefit of $0.2 million (effective rate of 35%) and net loss of $0.5 million.

Page 63 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes (Continued)

The relationship of domestic and foreign components of earnings from continuing operations before income taxes is as follows:


	2008		2007		2006
(In thousands)

Domestic(a)	$	236,061	$	94,321	$	85,278
Foreign		195,023		169,570		148,164

	$	431,084	$	263,891	$	233,442


(a)		Domestic earnings before income taxes in 2008 reflected the $170 million gain on sale of the minority interest in Leviton Manufacturing Company. Domestic earnings before income taxes in 2008, 2007 and 2006 included interest expense, net of $43.4 million, $23.5 million and $14.8 million, respectively. The amount of interest expense related to foreign earnings is negligible. Domestic earnings also include corporate expense of $41.6 million in 2008, $62.8 million in 2007 and $47.3 million in 2006.

The components of income tax provision (benefit) on earnings from continuing operations are as follows:


	2008			2007		2006
(In thousands)

Current
Federal	$	109,216		$	22,984	$	3,283
Foreign		51,807			43,644		36,240
State		9,198			2,434		108

Total current provision		170,221			69,062		39,631

Deferred
Domestic		(8,605	)		10,513		19,962
Foreign		(4,218	)		640		(1,281	)

Total deferred provision (benefit)		(12,823	)		11,153		18,681

	$	157,398		$	80,215	$	58,312

Page 64 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes (Continued)

The reconciliation between the federal statutory tax rate and the Corporation’s effective tax rate on earnings from continuing operations is as follows:


	2008			2007			2006

Federal statutory tax rate		35.0	%		35.0	%		35.0	%
Increase (reduction) resulting from:
State tax — net of federal tax benefit		3.4			1.9			6.5	(b)
Taxes on foreign earnings		(2.1	)		(1.9	)		(3.2	)
Lower rate on income from Puerto Rico operations		(2.8	)		(3.8	)		(5.2	)
Change in valuation allowance		(0.3	)		(1.0	)		(21.2	)
Tax audits and reassessment of tax exposures		—			—			(0.9	)
Distribution from foreign subsidiary		—			—			13.7
Non-cash charge — deferred income taxes		3.3	(a)		—			—
Other		—			0.2			0.3

Effective tax rate		36.5	%		30.4	%		25.0	%


(a)		The 2008 income tax provision included a $14.0 million non-cash charge to establish a deferred federal income tax liability on state net operating loss and state income tax credit carryforwards incurred in periods prior to January 1, 2008.

(b)		State tax of 6.5% was fully offset by the change in the valuation allowance, and, as a result, had no net effect on the overall effective tax rate in 2006.

The Corporation’s tax years are open for all U.S. state and federal jurisdictions from 2005 through 2008. Certain state tax years remain open for 2004 filings. International statutes vary widely, and the open years range from 2003 through 2008. Taxing authorities have the ability to review prior tax years to the extent net operating loss and tax credit carryforwards relate to open tax years.

Page 65 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes (Continued)

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


	December 31,			December 31,
(In thousands)	2008			2007

Deferred tax assets
Pension and other benefit plans	$	82,206		$	27,284
Tax credit and loss carryforwards		56,113			81,774
Accrued employee benefits		21,464			17,930
Interest rate swap liability		14,957			4,990
Accounts receivable		11,407			9,212
Self-insurance liabilities		7,431			7,665
Inventories		7,279			8,105
Restructure accrual		4,981			—
Environmental liabilities		4,860			5,484
Other		4,600			11,781

Total deferred tax assets		215,298			174,225
Valuation allowance		(29,874	)		(31,063	)

Net deferred tax assets		185,424			143,162

Deferred tax liabilities
Acquired intangibles		(59,963	)		(70,636	)
Goodwill and investments		(16,493	)		(29,893	)
Property, plant and equipment		(15,231	)		(24,231	)
Pension and other benefit plans		(9,290	)		(9,690	)
Other		(9,229	)		(322	)

Total deferred tax liabilities		(110,206	)		(134,772	)

Net deferred tax assets	$	75,218		$	8,390

Balance Sheet Reconciliation
Current deferred income tax assets	$	33,983		$	57,278
Non-current deferred income tax assets		52,034			—
Current deferred income tax liabilities		(918	)		—
Long-term deferred income tax liabilities		(9,881	)		(48,888	)

Net deferred tax assets	$	75,218		$	8,390

Page 66 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes (Continued)

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


	December 31,		Expiration
(In thousands)	2008		Dates

Tax credit and loss carryforwards
U.S. state net operating loss carryforwards	$	20,509		2009 -- 2024
U.S. foreign tax credits		15,426		2009 -- 2015
U.S. state income tax credits		7,116		2009 -- 2026
Foreign net operating loss carryforwards with no expiration dates		9,296		—
Foreign net operating loss carryforwards		3,766		2009 -- 2017

Total tax credit and loss carryforwards	$	56,113

The gross amount of net operating loss carryforwards is $334 million. The loss carryforwards are composed of $291 million of U.S. state net operating loss carryforwards and $43 million of foreign net operating loss carryforwards.

On January 1, 2007, the Corporation adopted FIN 48. The adoption of FIN 48 had no impact on the Corporation. In the fourth quarter of 2007, the Corporation acquired Lamson & Sessions Co. and assumed its FIN 48 matters, which at December 31, 2008 represented $1.4 million of unrecognized tax benefits. If subsequently recognized, these unrecognized tax benefits would affect the effective tax rate on income from continuing operations. Additionally, there were no changes in unrecognized tax benefits related to either settlements with taxing authorities or lapses of an applicable statute of limitations during 2008 or 2007.

Valuation Allowances

The valuation allowance for deferred tax assets decreased by $1.2 million in 2008, $2.7 million in 2007 and $49.6 million in 2006 due primarily to management’s reassessment of certain state income tax net operating losses and credit carryforwards. The majority of the $29.9 million valuation allowance as of December 31, 2008 related to foreign net operating loss carryforwards and foreign income tax credit carryforwards and reflects management’s assessment that the probability of generating sufficient taxable income in certain foreign jurisdictions in the future does not meet the more-likely-than-not threshold.

Realization of the deferred tax assets is dependent upon the Corporation’s ability to generate sufficient future taxable income and, if necessary, execution of tax planning strategies. Management believes that it is more-likely-than-not that future taxable income, based on tax laws in effect as of December 31, 2008, will be sufficient to realize the recorded deferred tax assets, net of the existing valuation allowance at December 31, 2008. 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 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

Page 67 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


9.	Income Taxes (Continued)

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.


10.	Fair Value of Financial Instruments

The Corporation’s financial instruments include cash and cash equivalents, restricted cash, marketable securities, short-term trade receivables and payables and debt. Financial instruments also include interest rate swap agreements and foreign currency contracts. The carrying amounts of the Corporation’s financial instruments generally approximated their fair values at December 31, 2008 and 2007, 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 $669 million at December 31, 2008 and approximately $822 million at December 31, 2007, and the fair value of an interest rate swap at December 31, 2008 was a liability of $39.7 million and a liability of $13.6 million at December 31, 2007.


11.	Derivative Instruments

The Corporation is exposed to market risk from changes in interest rates, foreign-exchange rates and raw material prices. 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.

Interest Rate Swap Agreements

During the fourth quarter of 2007, the Corporation entered into a forward-starting interest rate swap for a notional amount of $390 million. The notional amount reduces to $325 million on December 15, 2010, $200 million on December 15, 2011 and $0 on October 1, 2012. The interest rate swap hedges $390 million of the Corporation’s exposure to changes in interest rates on borrowings under its $750 million credit facility. The Corporation has designated the interest rate swap as a cash flow hedge for accounting purposes. Under the interest rate swap, the Corporation receives variable one-month LIBOR and pays an underlying fixed rate of 4.86%.

On January 1, 2008, the Corporation adopted Financial Accounting Standard (SFAS) No. 157, “Fair Value Measurements,” for measuring “financial” assets and liabilities. SFAS 157 defines fair value as the price received to transfer an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. SFAS 157 establishes a framework for measuring fair value by creating a hierarchy of valuation inputs used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly; and, Level 3 inputs are unobservable inputs in which little or no market data exists, therefore requiring a company to develop its own valuation assumptions.

The Corporation’s interest rate swap was reflected at its fair value liability of $39.7 million as of December 31, 2008 and a liability of $13.6 million as of December 31, 2007. This swap is measured at fair value on a recurring basis each reporting period. The Corporation’s fair value estimate was determined using significant unobservable inputs and assumptions (Level 3) and, in

Page 68 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


11.	Derivative Instruments (Continued)

addition, the liability valuation reflects the Corporation’s credit standing. The valuation technique utilized by the Corporation to calculate the swap fair value was the income approach. This approach represents the present value of future cash flows based upon current market expectations. The credit valuation adjustment (which was a reduction in the liability) was determined to be $0.5 million as of December 31, 2008.

The following is a reconciliation associated with the interest rate swap of the fair value activity in accordance with SFAS No. 157 during 2008:


	Fair Value
	Measures
	(Level 3)
	December 31,
(In millions)	2008

Asset (liability) at beginning of period	$	(13.6	)
Total realized/unrealized gains or losses:
Included in earnings		—
Increased (decrease) in fair value included in comprehensive income		(26.1	)

Asset (liability) at end of period	$	(39.7	)

The Corporation’s balance of accumulated other comprehensive income has been reduced by $24.4 million, net of tax of $15.3 million, as of December 31, 2008 and $8.1 million, net of tax of $5.5 million, as of December 31, 2007 to reflect the above interest rate swap liability.

Interest expense, net reflects a benefit of $0.1 million in 2008 and a charge of $0.5 million in 2007 for the ineffective portion of the swap.

Interest expense, net in 2006 reflects a charge of $0.8 million associated with previous interest rate swap agreements that effectively converted certain fixed rate debt to floating rates.

Forward Foreign Exchange Contracts

The Corporation had no outstanding forward sale or purchase contracts as of December 31, 2008. During 2007, the Corporation entered into currency forward exchange contracts that amortized monthly in 2008. The contracts were not designated as a hedge for accounting purposes. These contracts were intended to reduce cash flow volatility from exchange rate risk related to a short-term intercompany financing transaction. Under the terms of the contracts, the Corporation sold U.S. dollars at current spot rates and purchased Canadian dollars at a fixed forward exchange rate. During 2008 and 2007, the Corporation recognized a mark-to-market loss of $0.7 million on these contracts and a mark-to-market gain on these contracts of $0.7 million, respectively, that effectively matched foreign exchange gains on the short-term intercompany financing transaction. The currency forward exchange contracts were reflected in the consolidated balance sheet at a fair value asset of $0.7 million as of December 31, 2007. During 2006, the Corporation had no mark-to-market adjustments for forward foreign exchange contracts.

Page 69 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


11.	Derivative Instruments (Continued)

Commodities Futures Contracts

During 2008, 2007 and 2006, the Corporation had no outstanding 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 has been mitigated through the use of futures contracts that fixed the price the Corporation paid for a commodity.


12.	Debt

The Corporation’s long-term debt at December 31, 2008 and 2007 was:


	December 31,		December 31,
(In thousands)	2008		2007

Senior credit facility(a)	$	390,000	$	420,000
Unsecured notes:
6.63% Notes due 2008		—		114,956
6.39% Notes due 2009(b)(c)		146,841		149,939
7.25% Notes due 2013(b)		121,671		120,931
Other, including capital leases		2,432		5,379

Long-term debt (including current maturities)		660,944		811,205
Less current maturities		148,751		116,157

Long-term debt, net of current maturities	$	512,193	$	695,048


(a)		Interest is paid monthly.

(b)		Interest is paid semi-annually.

(c)		Repaid in February 2009 with $125 million obtained from the $750 million revolving credit facility and the remainder from available cash resources.

Principal payments due on long-term debt including capital leases in each of the five years subsequent to 2008 are as follows:


(In thousands)

2009	$	148,751
2010		522
2011		—
2012		390,000
2013		121,671
Thereafter		—

	$	660,944

The indentures underlying the unsecured notes 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.

Page 70 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


12.	Debt (Continued)

In October 2007, the Corporation amended and restated its unsecured, senior credit facility. No material changes were made in the amendment process other than increasing the amount of available credit. The Corporation has a revolving credit facility with total availability of $750 million and a five year term expiring in October 2012. All borrowings and other extensions of credit under the Corporation’s revolving credit facility are subject to the satisfaction of customary conditions, including absence of defaults and accuracy in material respects of representations and warranties. The proceeds of any loans under the revolving credit facility may be used for general operating needs and for other general corporate purposes in compliance with the terms of the facility. The Corporation pays an annual commitment fee to maintain this facility of 10 basis points. At December 31, 2008, $390 million was outstanding under this facility. At December 31, 2007, $420 million was outstanding under this facility.

Under the revolving credit facility agreement, the Corporation selected an interest rate on its initial draw of the revolver based on the one-month LIBOR plus a margin based on the Corporation’s debt rating. Fees to access the facility and letters of credit under the facility are based on a pricing grid related to the Corporation’s debt ratings with Moody’s, S&P, and Fitch during the term of the facility.

The Corporation’s amended and restated revolving credit facility requires that it maintain:


	•	a maximum leverage ratio of 4.00 to 1.00 through December 31, 2008, then a ratio of 3.75 to 1.00 thereafter; and

	•	a minimum interest coverage ratio of 3.00 to 1.00.

It also contains customary covenants that could restrict the Corporation’s ability to: incur additional indebtedness; grant liens; make investments, loans, or guarantees; declare dividends; or repurchase company stock.

The Corporation has a EUR 10.0 million (approximately US$14.2 million) committed revolving credit facility with a European bank. The Corporation pays an annual commitment fee of 20 basis points on the undrawn balance to maintain this facility. This credit facility contains standard covenants similar to those contained in the $750 million credit agreement and standard events of default such as covenant default and cross-default. This facility has an indefinite maturity and no borrowings were outstanding as of December 31, 2008 and 2007.

The Corporation has a CAN 30.0 million (approximately US$24.7 million) committed revolving credit facility with a Canadian bank. The Corporation pays an annual commitment fee of 12.5 basis points on the undrawn balance to maintain this facility. This credit facility contains standard covenants similar to those contained in the $750 million credit agreement and standard events of default such as covenant default and cross-default. This facility matures in 2011, and no borrowings were outstanding as of December 31, 2008.

As of December 31, 2008, the Corporation’s aggregate availability of funds under its credit facilities is approximately $387.4 million, after deducting outstanding letters of credit. The Corporation has the

Page 71 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


12.	Debt (Continued)

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.

As of December 31, 2008, the Corporation also had letters of credit in addition to those discussed above that do not reduce availability under the Corporation’s credit facilities. The Corporation had $22.9 million of such additional letters of credit that relate primarily to environmental assurances, third-party insurance claims processing, performance guarantees and acquisition obligations.


13.	Share-Based Payment Arrangements

As of December 31, 2008, 2007 and 2006, the Corporation has equity compensation plans for key employees and for non-employee directors. Amounts recognized in the consolidated financial statements with respect to the Corporation’s plans are as follows:


(In thousands)	2008			2007			2006

Total cost of share-based payment plans during the year	$	19,824		$	12,444		$	12,196
Amounts capitalized in inventories during the year		(1,771	)		(1,364	)		(1,266	)
Amounts recognized in income during the year for amount previously capitalized		1,370			1,397			989

Amounts charged against income during the year, before income tax benefit		19,423			12,477			11,919
Related income tax benefit recognized in income during the year		(7,381	)		(4,741	)		(4,529	)

Share-based payments compensation expense, net of tax	$	12,042		$	7,736		$	7,390

Share-based compensation has historically been awarded to key employees during the first quarter of each year. In December 2008, the Corporation’s Board of Directors changed the schedule for annual awards to the fourth quarter of each year. Share-based compensation expense in 2008 reflects this change in award timing and includes awards during the first and fourth quarters of 2008.

Under the provisions of SFAS No. 123R, awards granted after the adoption date with features that shorten the requisite service period, such as retirement eligibility, are amortized over the minimum period an employee is required to provide service to vest in the award. The 2008 net of tax share-based compensation expense reflected approximately $6 million of accelerated amortization over periods shorter than the stated service periods. The 2007 and 2006 net of tax share-based compensation expense reflected approximately $2 million of accelerated amortization over periods shorter than the stated service periods.

2008 Stock Incentive Plan

In May 2008, the Corporation’s shareholders approved the Thomas & Betts Corporation 2008 Stock Incentive Plan, which expires in 2018, unless terminated earlier. Pursuant to the terms of the plan, the Corporation may grant to certain employees and nonemployee directors of the Corporation and certain of its subsidiaries, incentive and nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, stock grants and stock credits. The maximum number of

Page 72 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


13.	Share-Based Payment Arrangements (Continued)

shares of the Corporation’s common stock available under the plan for all types of awards is 4,500,000. The maximum number of shares of the Corporation’s common stock available under the plan for restricted stock, restricted stock units, stock grants and stock credits is 825,000. Restricted stock represents nonvested shares as defined by SFAS No. 123R, with compensation expense recognized over the requisite service period (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. For awards to employees under the plan, nonvested restricted stock awards cliff-vest in three years from the award date. Stock option grants to purchase common stock have graded-vesting of one-third increments beginning on the anniversary of the date of grant. Nonvested restricted stock awards to nonemployee directors cliff-vest in one year from the award date.

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. Restricted stock represents nonvested shares as defined by SFAS No. 123R, with compensation expense recognized over the requisite service period (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. For awards under the plan, nonvested restricted stock awards cliff-vest in three years after the award date and options to purchase common stock have graded-vesting of 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 Compensation Plan. Under the Non-Employee Directors Equity Compensation 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, stock awards with no restrictions for up to 100,000 shares of common stock, and stock credits for up to 750,000 shares of common stock. Restricted stock represents nonvested shares as defined by SFAS No. 123R, since such shares cannot be sold prior to completion of the requisite service period (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. For awards under the plan, nonvested restricted stock awards and options to purchase common stock cliff-vest in one year after the grant date. 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.

Change of Control Provisions

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

Page 73 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


13.	Share-Based Payment Arrangements (Continued)

Methods Used to Measure Compensation

Stock Options

The Corporation’s option grants qualify for classification as equity and such grants contain no provisions to allow an employee to force cash settlement by the Corporation. The Corporation’s options do not contain future market or performance conditions. The fair value of grants has been estimated on the grant date using a Black-Scholes-Merton option-pricing model. The measurement date is the grant date. The Corporation has elected a straight-line amortization method over the requisite service period (vesting period). The Corporation’s current estimate of forfeitures ranges from 1.5% to 5.0%. Compensation expense associated with option grants was recorded as selling, general and administrative (SG&A) expense and cost of sales, similar to other compensation expense.

The Corporation has three homogenous groups which are expected to have different option exercise behaviors: executive management, non-executive management and the Board of Directors. Expected lives of share options were derived from historical data. The risk-free rate is based on the U.S. Treasury yield curve for the expected terms. Expected volatility is based on a combination of historical volatility of the Corporation’s common stock and implied volatility from traded options in the Corporation’s common stock.

The following are assumptions used in Black-Scholes-Merton valuations:


	2008		2007		2006

Weighted-average volatility		30%-45%		30%		30%
Expected dividends		—%		—%		—%
Expected lives in years		4.0-5.0		4.5-5.5		4.5-6.0
Risk-free rate		1.50%-3.00%		4.50%-4.75%		4.50%-5.00%

Nonvested Shares

The Corporation’s nonvested share (restricted stock) awards qualify for classification as equity and such awards contain no provisions to allow an employee to force cash settlement by the Corporation. The initial measurement date is the award date. The Corporation has elected a straight-line amortization method over the requisite service period (vesting period). The fair value of awards has been determined as the stock price on the award date. The Corporation’s current estimate of forfeitures is 1.5% to 5.0%. Compensation expense associated with nonvested restricted stock awards was recorded as SG&A expense and cost of sales, similar to other compensation expense.

Page 74 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


13.	Share-Based Payment Arrangements (Continued)

Summary of Option Activity

The following is a summary of option transactions:


				Weighted-		Weighted-
				Average		Average
	Number			Exercise		Contractual		Aggregate
	of Shares			Price		Term		Intrinsic Value
						(Years)		(In thousands)

Outstanding at December 31, 2005		3,947,240		$	27.84
Granted		626,528			45.00
Exercised		(1,962,993	)		29.13
Forfeited or expired		(50,088	)		33.74

Outstanding at December 31, 2006		2,560,687		$	30.98		6.24	$	42,933
Granted		404,282			47.91
Exercised		(904,858	)		27.32
Forfeited or expired		(99,821	)		43.58

Outstanding at December 31, 2007		1,960,290		$	35.47		6.61	$	28,110
Granted		2,163,442			27.36
Exercised		(73,420	)		25.63
Forfeited or expired		(173,832	)		47.66

Outstanding at December 31, 2008		3,876,480		$	30.59		7.86	$	9,787


Exercisable at December 31, 2006		1,415,653		$	27.03		4.44	$	29,552

Exercisable at December 31, 2007		1,044,843		$	28.37		5.13	$	22,647

Exercisable at December 31, 2008		1,357,871		$	31.40		5.11	$	2,372

The weighted-average grant date fair value of options granted during 2008 was $9.43, during 2007 was $16.91 and during 2006 was $15.51. The total intrinsic value of options exercised during 2008 was $1.1 million, during 2007 was $25.4 million and during 2006 was $42.0 million.

Page 75 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


13.	Share-Based Payment Arrangements (Continued)

Summary of Nonvested Shares Activity

The following is a summary of nonvested shares (restricted stock) transactions:


				Weighted-
	Number			Average
	of			Grant Date
	Shares			Fair Value

Nonvested at December 31, 2005		239,288		$	22.23
Granted		89,182		$	45.40
Vested		(90,496	)	$	18.02
Forfeited		—			—

Nonvested at December 31, 2006		237,974		$	32.51
Granted		135,645		$	48.43
Vested		(84,650	)	$	23.14
Forfeited		—			—

Nonvested at December 31, 2007		288,969		$	42.73
Granted		446,709		$	26.34
Vested		(103,359	)	$	32.93
Forfeited		(8,941	)	$	45.44

Nonvested at December 31, 2008		623,378		$	32.57

As of December 31, 2008, there was $11.3 million of total unrecognized compensation cost related to nonvested restricted stock. That cost is expected to be recognized over a weighted-average period of 2.2 years. The total grant date fair value of restricted stock that vested during 2008 was $3.4 million, during 2007 was $2.0 million and during 2006 was $1.6 million.

Recognized Tax Benefits

During 2008, 2007 and 2006, the Corporation recognized tax benefits of $0.6 million, $8.9 million and $15.9 million, respectively, related to the exercise of stock options and vesting of restricted stock. This benefit was credited directly to additional paid-in capital.

Page 76 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits

The following is information regarding the Corporation’s 2008 and 2007 domestic and international pension benefit and other postretirement benefit obligations:


							Other
							Postretirement
	Pension Benefits						Benefits
(In thousands)	2008			2007			2008			2007

Change in benefit obligation
Benefit obligation at January 1	$	491,310		$	405,713		$	25,034		$	18,009
Service cost		12,410			11,139			60			121
Interest cost		31,785			23,216			1,346			1,064
Plan participants’ contributions		102			135			644			101
Plan amendments		296			44			—			—
Acquisitions(a)		—			95,185			—			7,769
Actuarial loss (gain)		(3,035	)		(24,499	)		(279	)		120
Foreign-exchange impact		(14,618	)		2,019			—			—
Curtailments/Settlements(b)		(5,541	)		(724	)		(2,561	)		—
Benefits paid		(29,119	)		(20,918	)		(3,078	)		(2,150	)

Benefit obligation at December 31		483,590			491,310			21,166			25,034

Change in plan assets
Fair value of plan assets at January 1		482,820			365,608			—			—
Actual return on plan assets		(123,190	)		33,740			—			—
Acquisitions(a)		—			100,497			—			—
Employer contributions:
Qualified pension plans		1,849			1,887			—			—
Non-qualified pension plans		1,944			1,667			—			—
Postretirement benefit plans		—			—			2,434			2,049
Plan participants’ contributions		102			135			644			101
Foreign-exchange impact		(14,900	)		928			—			—
Curtailments/Settlements		—			(724	)		—			—
Benefits paid		(29,119	)		(20,918	)		(3,078	)		(2,150	)

Fair value of plan assets at December 31		319,506			482,820			—			—

Funded status:
Benefit obligation in excess of plan assets	$	164,084		$	8,490		$	21,166		$	25,034


(a)		During 2007, the Corporation assumed the benefit plan obligations of Lamson & Sessions, which are also closed to new entrants.

(b)		Amounts in 2008 reflect primarily curtailments of benefit plans associated with the Lamson & Sessions acquisition.

Page 77 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits (Continued)

Pre-tax amounts recognized in the balance sheet for pension and other postretirement benefits included the following components:


							Other
							Postretirement
	Pension Benefits						Benefits
(In thousands)	2008			2007			2008		2007

Prepaid benefit cost (non-current asset)	$	(4,617	)	$	(34,117	)	$	—	$	—
Accrued benefit liability:
Current liability		1,548			1,446			2,847		3,129
Non-current liability		167,153			41,161			18,319		21,905

Total accrued benefit liability		168,701			42,607			21,166		25,034

Net amount recognized	$	164,084		$	8,490		$	21,166	$	25,034

Pre-tax amounts recognized in accumulated other comprehensive income consist of:


							Other
	Pension						Postretirement
	Benefits						Benefits
(In thousands)	2008			2007			2008			2007

Net actuarial loss (gain)	$	206,374		$	57,393		$	(626	)	$	1,600
Prior service cost (credit)		8,042			8,641			(627	)		(607	)
Net transition obligation (asset)		(52	)		(83	)		3,066			3,832

	$	214,364		$	65,951		$	1,813		$	4,825

The accumulated benefit obligation for all pension plans was $451.8 million at December 31, 2008 and $452.2 million at December 31, 2007.

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


							Other
	Pension Benefits						Postretirement Benefits
	December 31,			December 31,			December 31,			December 31,
	2008			2007			2008			2007

Discount rate		6.30	%		6.18	%		6.25	%		6.07	%
Rate of increase in compensation level		4.01	%		4.45	%		—	%		—	%

Reflected in the weighted-average rates above used in determining the benefit obligations are the U.S. discount rates of 6.25% for 2008 and 2007.

Page 78 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits (Continued)

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


	December 31,		December 31,
(In thousands)	2008		2007

Projected benefit obligation	$	37,058	$	450,683
Accumulated benefit obligation		35,221		422,634
Fair value of plan assets		41,390		482,025

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


	December 31,		December 31,
(In thousands)	2008		2007

Projected benefit obligation	$	446,532	$	40,627
Accumulated benefit obligation		416,553		29,588
Fair value of plan assets		278,116		795

The Corporation maintains non-qualified supplemental pension plans covering certain key employees, which provide for benefit payments that exceed the limit for deductibility imposed by income tax regulations. The projected benefit obligation above related to these unfunded plans was $42.6 million at December 31, 2008 and $39.3 million at December 31, 2007.

Net periodic cost for the Corporation’s pension and other postretirement benefits for 2008, 2007 and 2006 included the following components:


										Other
	Pension Benefits									Postretirement Benefits
(In thousands)	2008			2007			2006			2008			2007			2006

Service cost	$	11,779		$	11,139		$	10,346		$	60		$	121		$	142
Interest cost		30,229			23,216			21,267			1,346			1,064			977
Expected return on plan assets		(39,210	)		(31,953	)		(28,295	)		—			—			—
Plan net loss (gain)		2,462			4,181			6,083			121			562			511
Prior service cost (gain)		1,135			1,068			952			(238	)		(225	)		(225	)
Transition obligation (asset)		(14	)		(15	)		(16	)		766			766			766
Curtailment and settlement loss/(gain)(a)		(938	)		198			—			(477	)		—			—

Net periodic benefit cost	$	5,443		$	7,834		$	10,337		$	1,578		$	2,288		$	2,171


(a)		Amounts in 2008 reflect primarily curtailments of benefit plans associated with the Lamson & Sessions acquisition.

During 2007, the Board of Directors of the Corporation approved an amendment to one of the Corporation’s major domestic pension plans covering salaried employees (The Thomas & Betts Pension Plan) that precludes entry to employees hired after December 31, 2007. It also precludesre-entry for employees who lose eligibility at any time after December 31, 2007.

Page 79 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits (Continued)

The following table summarizes components included in accumulated other comprehensive income.


													Included in
	Defined Benefit Pension and Other Postretirement Plans												Accumulated
										Pension Related			Other
	Net Actuarial			Prior Service			Net Transition			Tax Valuation			Comprehensive
(In thousands)	Gains (Losses)			Credit (Cost)			Asset (Obligation)			Adjustment(a)			Income

Pre-Tax:
Balance at December 31, 2005	$	—		$	—		$	—		$	(5,015	)	$	(5,015	)
Comprehensive Income		—			—			—			1,331			1,331
Adoption of SFAS No. 158		(89,424	)		(8,714	)		(4,498	)		3,684			(98,952	)

Balance at December 31, 2006		(89,424	)		(8,714	)		(4,498	)		—			(102,636	)
Comprehensive Income		30,397			680			749			—			31,826

Balance at December 31, 2007		(59,027	)		(8,034	)		(3,749	)		—			(70,810	)
Comprehensive Income (Loss)		(146,721	)		619			735			—			(145,367	)

Balance at December 31, 2008	$	(205,748	)	$	(7,415	)	$	(3,014	)	$	—		$	(216,177	)

Tax Impacts:
Balance at December 31, 2005	$	—		$	—		$	—		$	(9,057	)	$	(9,057	)
Comprehensive Loss		—			—			—			(510	)		(510	)
Adoption of SFAS No. 158		32,393			3,236			1,720			(1,410	)		35,939

Balance at December 31, 2006		32,393			3,236			1,720			(10,977	)		26,372
Comprehensive Loss		(11,291	)		(294	)		(287	)		—			(11,872	)

Balance at December 31, 2007		21,102			2,942			1,433			(10,977	)		14,500
Comprehensive Income (Loss)		56,051			(243	)		(283	)		—			55,525

Balance at December 31, 2008	$	77,153		$	2,699		$	1,150		$	(10,977	)	$	70,025

Net of Tax:
Balance at December 31 , 2005	$	—		$	—		$	—		$	(14,072	)	$	(14,072	)
Comprehensive Income		—			—			—			821			821
Adoption of SFAS No. 158		(57,031	)		(5,478	)		(2,778	)		2,274			(63,013	)

Balance at December 31, 2006		(57,031	)		(5,478	)		(2,778	)		(10,977	)		(76,264	)
Comprehensive Income		19,106			386			462			—			19,954

Balance at December 31, 2007		(37,925	)		(5,092	)		(2,316	)		(10,977	)		(56,310	)
Comprehensive Income (Loss)		(90,670	)		376			452			—			(89,842	)

Balance at December 31, 2008	$	(128,595	)	$	(4,716	)	$	(1,864	)	$	(10,977	)	$	(146,152	)


(a)		Prior to the December 31, 2006 adoption of SFAS No. 158, activity represented changes in minimum pension liability.

The remaining balance at December 31, 2008 for pension related tax valuation adjustment relates to a prior income tax tax valuation allowance recognized in accumulated other comprehensive income. The December 31, 2008 balance of net actuarial losses, prior service costs, and net transition obligation expected to be amortized in 2009 is $17.5 million, $0.9 million and $0.8 million, respectively.

The Corporation expects 2009 required contributions to its qualified pension plans to be minimal. The Corporation’s contributions to all qualified pension plans was approximately $2 million in each of the years 2008, 2007 and 2006.

Page 80 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits (Continued)

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


			Other Post-
	Pension		retirement
(In millions)	Benefits		Benefits

2009	$	28.0	$	2.8
2010		28.9		2.8
2011		29.4		2.3
2012		30.8		2.2
2013		31.6		2.1
2014 – 2018		186.6		8.4

Expected benefit payments over next ten years	$	335.3	$	20.6

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


										Other
	Pension Benefits									Postretirement Benefits
	2008			2007			2006			2008			2007			2006

Discount rate		6.18	%		5.62	%		5.65	%		6.07	%		5.50	%		5.50	%
Rate of increase in compensation level		4.45	%		4.39	%		4.40	%		—	%		—	%		—	%
Expected long-term rate of return on plan assets		8.41	%		8.52	%		8.55	%		—	%		—	%		—	%

Reflected in the weighted-average rates above used in determining the net periodic pension benefit cost are the U.S. discount rate of 6.25% for 2008 and 5.75% for 2007 and 2006, and the U.S. expectedlong-term rate of return on plan assets of 8.75% for 2008, 2007 and 2006.

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 commensurate with liability durations of its plans. 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 its Retirement Plans Committee, and advice from its actuaries.

The assumed annual increases in health care cost at December 31, 2008 and 2007 are:


	2008			2007

Health care cost trend rate assumed for next year		8.0	%		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			2012

Page 81 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


14.	Pension and Other Postretirement Benefits (Continued)

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 annual increases in health care cost would have the following effects:


	1-Percentage-Point		1-Percentage-Point
(In thousands)	Increase		Decrease

Effect on total of service and interest cost	$	62	$	(55	)
Effect on postretirement benefit obligation		1,040		(931	)

The Corporation’s pension plans weighted-average asset allocations at December 31, 2008 and 2007 by asset category are as follows:


	Plan Assets
	December 31,			December 31,
	2008			2007

Asset Category
U.S. domestic equity securities		37	%		39	%
International equity securities		20	%		21	%
Debt securities		31	%		30	%
Other, including alternative investments		12	%		10	%

Total		100	%		100	%

The financial objectives of the Corporation’s investment policy are (1) to maximize returns in order to minimize contributions and long-term cost of funding pension liabilities, within reasonable and prudent levels of risk, (2) to match liability growth with the objective of fully funding benefits as they accrue and (3) to achieve annualized returns in excess of the applicable policy benchmark. The Corporation’s asset allocation targets are 43% U.S. domestic equity securities, 15% international equity securities, 26% fixed income and high yield debt securities and 16% other, including alternative investments. As of December 31, 2008 and 2007, 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 $7.1 million in 2008, $4.5 million in 2007 and $3.8 million in 2006.


15.	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.

Page 82 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


15.	Leases (Continued)

Future minimum payments under non-cancelable operating leases consisted of the following at December 31, 2008:


	Operating
(In thousands)	Leases

2009	$	16,675
2010		14,016
2011		10,815
2012		8,367
2013		6,993
Thereafter		9,645

Total minimum operating lease payments	$	66,511

Rent expense for operating leases was $32.5 million in 2008, $25.7 million in 2007, and $24.0 million in 2006.


16.	Other Financial Data

Repurchase of Common Shares

In 2006, the Corporation’s Board of Directors approved a share repurchase plan that authorized the Corporation to buy up to 3,000,000 of its common shares. During 2006, the Corporation repurchased, with available cash resources, all 3,000,000 common shares authorized by this plan through open-market transactions.

In 2006, the Corporation’s Board of Directors approved another share repurchase plan that authorized the Corporation to buy up to 3,000,000 of its common shares. During December 2006, the Corporation repurchased, with available cash resources, 667,620 common shares through open-market transactions. During 2007, the Corporation repurchased, with available cash resources, the remaining 2,332,380 common shares authorized by this plan throughopen-market transactions.

In 2007, the Corporation’s Board of Directors approved a share repurchase plan that authorized the Corporation to buy an additional 3,000,000 of its common shares. In 2007, the Corporation repurchased, with available cash resources, 200,700 common shares through open-market transactions. During 2008, the Corporation repurchased, with available cash resources, the remaining 2,799,300 common shares authorized by this plan through open-market transactions.

In 2008, the Corporation’s Board of Directors approved a share repurchase plan that authorized the Corporation to buy an additional 5,000,000 of its common shares. In 2008, the Corporation repurchased, with available cash resources, 2,425,000 common shares through open-market transactions. The timing of future repurchases, if any, will depend upon a variety of factors, including market conditions. This authorization expires in October 2010.

Page 83 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


16.	Other Financial Data (Continued)

Accumulated Other Comprehensive Income

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


	December 31,			December 31,
(In thousands)	2008			2007

Cumulative translation adjustment	$	(26,427	)	$	77,928
Net actuarial gains (losses)		(128,595	)		(37,925	)
Prior service credit (cost)		(4,716	)		(5,092	)
Net transition asset (obligation)		(1,864	)		(2,316	)
Pension related tax valuation adjustment(a)		(10,977	)		(10,977	)
Unrealized gain (loss) on interest rate swap		(24,404	)		(8,141	)

Accumulated other comprehensive income (loss)	$	(196,983	)	$	13,477


(a)		The remaining balance at December 31, 2008 for pension related tax valuation adjustment relates to a prior income tax valuation allowance recognized in accumulated other comprehensive income.

Other Financial Disclosures

Depreciation expense was $53.9 million in 2008, $49.5 million in 2007 and $47.4 million in 2006.

Research, development and engineering expenditures invested in new and improved products and processes were $35.1 million in 2008, $29.9 million in 2007 and $25.2 million in 2006. These expenditures are included in cost of sales.

The Corporation expenses the cost of advertising as it is incurred. Total advertising expense was $20.9 million in 2008, $20.9 million in 2007 and $19.1 million in 2006.

Interest expense, net in the accompanying consolidated statements of operations includes interest income of $4.7 million in 2008, $10.6 million in 2007 and $15.1 million in 2006.

Foreign exchange gain (loss) included in the accompanying consolidated statements of operations was $(7.7) million in 2008, $(2.3) million in 2007 and $1.5 million in 2006.

Accrued liabilities included salaries, fringe benefits and other compensation of $55.0 million in 2008 and $63.2 million in 2007.

In conjunction with the Lamson & Sessions Co. acquisition, the Corporation assumed the liability under employment agreements with certain former executives of that company. As of December 31, 2008, the Corporation has approximately $8 million in restricted cash for funding associated with the employment agreements. Through December 31, 2008, the Corporation has paid approximately $9 million to former executive officers from restricted cash and approximately $5 million related to income tax gross-up provisions from available cash resources.

Page 84 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


16.	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, 2008:


	Balance at									Balance at
	Beginning		Acquired							End
(In thousands)	of Year		Balances		Provisions		Deductions			of Year

2008	$	85,356	$	130	$	332,997	$	(327,064	)	$	91,419
2007	$	79,493	$	6,420	$	263,664	$	(264,221	)	$	85,356
2006	$	76,674	$	—	$	268,331	$	(265,512	)	$	79,493


17.	Segment and Other Related Disclosures

The Corporation has three reportable segments: Electrical, Steel Structures and HVAC. 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 before corporate expense, depreciation and amortization expense, share-based compensation expense, interest, income taxes and certain other items. Corporate expense includes legal, finance and administrative costs. The Corporation has no material inter-segment sales.

During 2008, the Corporation began to report segment earnings before depreciation, amortization and share-based compensation expenses. Management believes this change provides improved visibility into the underlying operating trends in the business segments and the contributions from the Corporation’s recent acquisitions. This change is also in line with how the Corporation measures performance internally. Segment information for the prior periods have been revised to conform to the current presentation.

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 highly engineered tubular steel transmission and distribution poles. The Steel Structures segment also markets lattice steel transmission towers for North American power and telecommunications companies which are currently sourced from third parties. The HVAC segment designs, manufactures and markets heating and ventilation products for commercial and industrial buildings. The Company’s U.S. Electrical and International Electrical operating segments have been aggregated in the Electrical reporting segment since they have similar economic characteristics as well as similar products and services, production processes, types of customers and methods used for distributing their products.

As a result of the Corporation’s decision to divest the PVC and HDPE pipe operations acquired as part of Lamson & Sessions Co., operating results for the pipe business are reported as “discontinued operations” and are shown on a net basis on the consolidated financial statements. These results are not included in segment reporting.

Page 85 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


17.	Segment and Other Related Disclosures (Continued)

Segment Information


(In thousands)	2008		2007		2006

Net Sales
Electrical	$	2,103,121	$	1,766,598	$	1,511,557
Steel Structures		231,554		227,356		221,671
HVAC		139,149		142,934		135,461

Total	$	2,473,824	$	2,136,888	$	1,868,689

Segment Earnings
Electrical	$	416,732	$	352,901	$	291,280
Steel Structures		44,336		42,623		38,705
HVAC		25,693		27,175		23,859

Total	$	486,761	$	422,699	$	353,844

Capital Expenditures
Electrical	$	34,508	$	32,754	$	38,937
Steel Structures		4,187		6,358		2,923
HVAC		3,399		1,601		2,485

Total	$	42,094	$	40,713	$	44,345

Depreciation and Amortization
Electrical	$	72,327	$	49,865	$	39,804
Steel Structures		3,730		3,442		3,188
HVAC		2,628		3,017		3,132

Total	$	78,685	$	56,324	$	46,124

Total Assets
Electrical	$	1,727,522	$	2,063,759	$	1,091,587
Steel Structures		147,426		132,772		148,319
HVAC		52,147		53,912		51,380

Total	$	1,927,095	$	2,250,443	$	1,291,286

Page 86 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


17.	Segment and Other Related Disclosures (Continued)

The following are reconciliations of the reportable segments to the consolidated Corporation:


(In thousands)	2008			2007			2006

Earnings from Continuing Operations Before Income Taxes
Total reportable segment earnings	$	486,761		$	422,699		$	353,844
Corporate expense		(41,634	)		(62,768	)		(47,318	)
Depreciation, amortization and share-based compensation expense		(99,864	)		(70,243	)		(59,761	)
Intangible asset impairment		(32,700	)		—			—
Gain on sale of equity interest		169,684			—			—
Interest expense, net		(43,426	)		(23,521	)		(14,840	)
Other (expense) income, net		(7,737	)		(2,276	)		1,517

Earnings from continuing operations before income taxes	$	431,084		$	263,891		$	233,442

Total Assets
Total from reportable segments	$	1,927,095		$	2,250,443		$	1,291,286
General corporate		483,507			317,343			538,937

Total	$	2,410,602		$	2,567,786		$	1,830,223

Page 87 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


18.	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 customer location.


(In thousands)	2008		2007		2006

Net Sales
U.S.	$	1,622,819	$	1,394,139	$	1,238,127
Canada		433,490		382,336		345,795
Europe		268,650		240,108		201,060
Other countries		148,865		120,305		83,707

Total	$	2,473,824	$	2,136,888	$	1,868,689

Long-lived Assets
U.S.	$	1,181,926	$	1,295,321	$	635,077
Canada		145,997		163,968		122,155
Europe		125,095		154,120		113,768
Other countries		22,842		26,937		28,964

Total	$	1,475,860	$	1,640,346	$	899,964


19.	Contingencies

Legal Proceedings

The Corporation is involved in legal proceedings and litigation arising in the ordinary course of business. In those cases where the Corporation is 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. The Corporation has provided for losses to the extent probable and estimable. The legal matters that have been recorded in the Corporation’s consolidated financial statements are based on gross assessments of expected settlement or expected outcome and do not reflect possible recovery from insurance companies or other parties. Additional losses, even though not anticipated, could have a material adverse effect on the Corporation’s 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 throughcost-sharing agreements with terms which vary from site to site. Costs are typically

Page 88 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


19.	Contingencies (Continued)

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.

In conjunction with the acquisition of Lamson & Sessions Co., Joslyn Hi-Voltage, Power Solutions, Drilling Technical Supply SA, The Homac Manufacturing Company and Boreal Braidings Inc., the Corporation assumed responsibility for environmental matters for those entities. Related to the acquisition of Lamson & Sessions Co., the Corporation assumed responsibility for environmental liabilities involving a site in Ohio.

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 $14 million and $17 million as of December 31, 2008 and 2007, respectively. The Corporation is not able to predict the extent of its ultimate liability with respect to all of its pending or future environmental matters, and liabilities arising from potential environmental obligations that have not been reserved at this time may be material to the operating results of any single quarter or year in the future. The operation of manufacturing plants involves a high level of susceptibility in these areas, and there is no assurance that the Corporation 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.

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.

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.

Page 89 of 97

Thomas & Betts Corporation and Subsidiaries

Notes To Consolidated Financial Statements


19.	Contingencies (Continued)

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


(In thousands)	2008			2007			2006

Balance at beginning of year	$	3,894		$	1,737		$	1,478
Acquired liabilities for warranties		—			2,714			—
Liabilities accrued for warranties issued during the year		2,648			1,486			1,367
Changes in liability for pre-existing warranties during the year, including expirations		11			697			270
Deductions for warranty claims paid during the year		(3,441	)		(2,740	)		(1,378	)

Balance at end of year	$	3,112		$	3,894		$	1,737

Page 90 of 97

Thomas & Betts Corporation and Subsidiaries

SUPPLEMENTARY FINANCIAL DATA


(In thousands, except per share data)	2008			2007
	(Unaudited)

First Quarter
Net sales	$	595,504		$	474,552
Gross profit		186,261			144,865
Net earnings		38,252			37,140
Per share net earnings(a)
Basic		0.66			0.63
Diluted		0.66			0.63

Second Quarter
Net sales	$	641,317		$	507,238
Gross profit		199,975			154,807
Net earnings		147,840	(b)		46,553
Per share net earnings(a)
Basic		2.56			0.81
Diluted		2.54			0.80

Third Quarter
Net sales	$	665,679		$	552,704
Gross profit		208,273			170,720
Net earnings		62,159			51,251
Per share net earnings(a)
Basic		1.10			0.89
Diluted		1.09			0.88

Fourth Quarter
Net sales	$	571,324		$	602,394
Gross profit		181,471			191,149
Net earnings		17,080			48,272
Per share net earnings(a)
Basic		0.31			0.84
Diluted		0.31			0.83

Note: As a result of the Corporation’s decision to divest the PVC and HDPE pipe operations acquired as part of Lamson & Sessions Co., operating results for the pipe businesses are reported as “discontinued operations” and are shown on a net basis on the consolidated financial statements. Discontinued operations in 2008 reflected net sales of approximately $164 million and net loss of $8.4 million. Discontinued operations in the fourth quarter of 2007 reflected net sales of approximately $32 million and net loss of $0.5 million.


(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 nonvested restricted stock, when applicable.

(b)		Net earnings for the second quarter of 2008 reflects a gain of approximately $170 million from the Corporation’s sale of its minority interest in Leviton Manufacturing Company.

Page 91 of 97


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.


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

Management’s report on internal control over financial reporting is on page 41 of thisForm 10-K and is incorporated by reference into this Item.


*(c)*	*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 2008 that have materially affected or are reasonably likely to materially affect the Corporation’s internal control over financial reporting.


Item 9B.	OTHER INFORMATION

None.

Page 92 of 97

PART III


Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE


EXECUTIVE OFFICERS	DIRECTORS


Dominic J. Pileggi Chairman of the Board, and Chief Executive Officer Kenneth W. Fluke Senior Vice President and Chief Financial Officer J.N. Raines Vice President — General Counsel and Secretary Imad Hajj Senior Vice President — Global Operations Stanley P. Locke Vice President — Business Development and Strategic Planning William E. Weaver, Jr. Vice President— Controller	Dominic J. Pileggi Chairman of the Board, and Chief Executive Officer Director since 2004 Jeananne K. Hauswald Managing Director Solo Management Group, LLC Director since 1993⁽²⁾⁽³⁾Dean Jernigan Chief Executive Officer U-Store-It Trust Director since 1999⁽¹⁾Ronald B. Kalich, Sr. Former President and Chief Executive Officer of FastenTech, Inc. Director since 1998^(3)()Kenneth R. Masterson Former Executive Vice President General Counsel and Secretary FedEx Corporation* Director since 1993^(2)(*)(3)(4)	Jean-Paul Richard Chairman of the Board and Chief Executive Officer H-E Parts, International Director since 1996⁽¹⁾Rufus H. Rivers Managing Director RJL Equity Partners, LLC Director since 2008⁽¹⁾Kevin L. Roberg President and Chief Executive Officer of ProStaff, Inc. Director since 2007⁽¹⁾David D. Stevens Former Chief Executive Officer Accredo Health, Incorporated Director since 2004^(1)()(2)William H. Waltrip Former Chairman of Technology Solutions Company* Director since 1983⁽²⁾


⁽¹⁾		Audit Committee

⁽²⁾		Nominating and Governance Committee

⁽³⁾		Compensation Committee

⁽⁴⁾		Lead Director

^(*)		Committee Chair

Information regarding members of the Board of Directors is incorporated by reference from the section Corporate Governance, Certain Relationships and Related Transactions of the definitive Proxy Statement for our Annual Meeting of Shareholders.

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

Information required by Item 405 ofRegulation 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.

Information regarding Director Independence and Corporate Governance as required by Item 407(c)(3), (d)(4) and (d)(5) is incorporated by reference from the Corporate Governance sections of the definitive Proxy Statement for our Annual Meeting of Shareholders.

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 at www.tnb.com. Any amendment to or waiver from any provision in our code of conduct required to be disclosed as Item 10 onForm 8-K will be posted on our Internet site.

Page 93 of 97


Item 11.	EXECUTIVE COMPENSATION

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


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

Information required by Item 403 ofRegulation 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, 2008, we had the following compensation plans under which common stock has been issued or may be issued.


					Number of securities
					remaining available
					for future issuance
	Number of securities		Weighted-average		under equity
	to be issued upon		exercise price of		compensation plans
	exercise of		outstanding		(excluding securities
	outstanding options,		options, warrants		reflected in
	warrants and rights		and rights		column(a))
Plan Category	(a)		(b)		(c)

Equity compensation plans approved by security holders
2008 Stock Incentive Plan		1,436,459	$	18.86		2,738,310
Equity Compensation Plan		1,798,323		42.88		—
Non-employee Directors Equity Compensation Plan		50,283		34.43		—
1993 Management Stock Ownership Plan		300,165		22.71		—
Equity compensation plans not approved by security holders
Deferred Fee Plan for Non-employee Directors		42,847		—		—
Non-employee Directors Stock Option Plan		83,800		21.60		—
2001 Stock Incentive Plan		207,450		19.27		—

Total		3,919,327	$	30.59		2,738,310

The 1993 Management Stock Ownership Plan, 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. The Equity Compensation Plan and the Non-Employee Directors Equity Compensation Plan were terminated in May 2008. No new awards may be made under any of the aforementioned plans; however, awards issued under the plans prior to the May 2004 and May 2008, respectively, will continue under the terms of the plans.

Description of equity compensation plans not approved by security holders:

Deferred Fee Plan for Non-employee Directors

The Deferred Fee Plan for Non-employee 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

Page 94 of 97

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 stock as stock appreciation rights or in one or more 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 Non-employee Directors Stock Option Plan provided that each non-employee 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, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

The information required by this item appears in the section entitled “Certain Relationships, Related Transactions and Director Independence” 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.

Page 95 of 97

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 reports of the independent registered public accounting firm are filed with this Annual Report in Part II, Item 8:

Reports of Independent Registered Public Accounting Firm

Consolidated Statements of Operations for 2008, 2007 and 2006

Consolidated Balance Sheets as of December 31, 2008 and 2007

Consolidated Statements of Cash Flows for 2008, 2007 and 2006

Consolidated Statements of Shareholders’ Equity and Comprehensive Income for 2008, 2007 and 2006

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-5 is incorporated by reference.

Page 96 of 97

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 17, 2009


	By:	/s/ Dominic J. Pileggi

Dominic J. Pileggi

Chairman 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, and Chief Executive Officer (Principal Executive Officer)	February 17, 2009
/s/ Jeananne K. Hauswald Jeananne K. Hauswald	Director	February 17, 2009
/s/ Dean Jernigan Dean Jernigan	Director	February 17, 2009
/s/ Ronald B. Kalich, Sr. Ronald B. Kalich, Sr.	Director	February 17, 2009
/s/ Kenneth R. Masterson Kenneth R. Masterson	Director	February 17, 2009
/s/ Jean-Paul Richard Jean-Paul Richard	Director	February 17, 2009
/s/ Rufus H. Rivers Rufus H. Rivers	Director	February 17, 2009
/s/ Kevin L. Roberg Kevin L. Roberg	Director	February 17, 2009
/s/ David D. Stevens David D. Stevens	Director	February 17, 2009
/s/ William H. Waltrip William H. Waltrip	Director	February 17, 2009
/s/ Kenneth W. Fluke Kenneth W. Fluke	Senior Vice President and Chief Financial Officer (Principal Financial Officer)	February 17, 2009
/s/ William E. Weaver, Jr. William E. Weaver, Jr.	Vice President — Controller	February 17, 2009

Page 97 of 97

PART IV

EXHIBIT INDEX


Exhibit No.			Description of Exhibit

	2	.1	Agreement and Plan of Merger, dated as of August 15, 2007, among Parent, Merger Sub and the Company (the schedules and exhibits have been omitted pursuant to Item 6.01(b)(2) ofRegulation S-K). (Incorporated by reference to Item 1.01 of the Current Report onForm 8-K dated August 16, 2007).
	3	.1	Amended and Restated Charter of Thomas & Betts Corporation (Filed as Exhibit 3.1 to the Registrant’s Annual Report onForm 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 onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	4	.1	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 onForm 8-K dated February 2, 1998 and incorporated herein by reference).
	4	.2	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 onForm 8-K dated May 4, 1998 and incorporated herein by reference).
	4	.3	Trust Indenture dated as of August 1, 1998 between Thomas & Betts Corporation and The Bank of New York, as Trustee (Filed as Exhibit 4.3 to the Registrant’s Registration Statement onForm S-3 dated December 3, 2008 and incorporated herein by reference).
	4	.4	Supplemental Indenture No. 1 dated February 10, 1999, between Thomas and Betts Corporation and The Bank of New York, a Trustee (Filed as Exhibit 4.5 to the Registrant’s Registration Statement onForm S-3 dated December 3, 2008 and incorporated herein by reference).
	4	.5	Supplemental Indenture No. 2 dated May 27, 2003, between Thomas & Betts Corporation and The Bank of New York, as Trustee (Filed as Exhibit 4.6 to the Registrant’s Registration Statement onForm S-3 dated December 3, 2008 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 onForm 10-Q for the quarter ended July 1, 2001 and incorporated herein by reference).
	10	.2†	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 onForm 10-K for the fiscal year ended January 3, 1999 and incorporated herein by reference).
	10	.3†	Restricted Stock Plan for Non-employee Directors as amended March 7, 2003 (Filed as Exhibit 10.7 to the Registrant’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).

E-1


Exhibit No.			Description of Exhibit

	10	.4†	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 onForm 10-K for the fiscal year ended December 31, 2000 and incorporated herein by reference).
	10	.5†	Thomas & Betts Corporation 2001 Stock Incentive Plan (Filed as Exhibit 10.1 to Registrant’s Registration Statement onForm S-8 dated May 2, 2001 (FileNo. 333-60074), and incorporated herein by reference).
	10	.6†	Executive Retirement Plan, as amended February 4, 2004 (Filed as Exhibit 10.13 to the Registrant’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10	.7†	Non-employee Directors Equity Compensation Plan (Filed as Exhibit 10.19 to the Registrant’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10	.8†	Form of Non-Qualified Stock Option Agreement pursuant to the Thomas & Betts Corporation Non-employee Directors Equity Compensation Plan (Filed as Exhibit 10 to the Registrant’s Current Report onForm 8-K dated August 31, 2004 and incorporated herein by reference).
	10	.9†	Equity Compensation Plan (Filed as Exhibit 10.20 to the Registrant’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10	.10†	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 onForm 8-K dated February 2, 2005 and incorporated herein by reference).
	10	.11†	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 onForm 8-K dated February 2, 2005 and incorporated herein by reference).
	10	.12†	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 onForm 8-K dated February 2, 2005 and incorporated herein by reference).
	10	.13†	Management Incentive Plan (Filed as Exhibit 10.21 to the Registrant’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003 and incorporated herein by reference).
	10	.14†	Form of Restricted Stock Agreement Pursuant to Thomas & Betts CorporationNon-employee Directors Equity Compensation Plan. (Filed as Exhibit 10.28 to the Registrant’s Quarterly Report onForm 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference.)
	10	.15	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 onForm 10-Q for the quarter ended June 29, 2003 and incorporated herein by reference).

E-2


Exhibit No.			Description of Exhibit

	10	.16	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 onForm 10-Q for the fiscal quarter ended June 29, 2003 and incorporated herein by reference).
	10	.17	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 onForm 8-K dated June 14, 2005 and incorporated herein by reference).
	10	.18	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 ofForm 8-K dated August 17, 2005 and incorporated herein by reference).
	10	.19	Second Amendment to Amended and Restated Credit Agreement dated December 18, 2006, as borrower, the lenders party thereto, and Wachovia Bank National Association, as administrative agent (Filed as Exhibit 10.1 to the Registrant’s Current Report onForm 8-K dated December 18, 2006, and incorporated herein by reference).
	10	.20†	Approval of Incentive Payments (Incorporated by reference to Item 1.01 of the Registrant’s Current Report ofForm 8-K dated February 6, 2007).
	10	.21	Purchase and Sale Agreement dated as of July 25, 2007, between the Corporation as Purchaser and Joslyn Holding Company, Danaher UK Industries Limited, and Joslyn Canada as Sellers (Incorporated by reference to Item 2.01 of the Registrant’s Current Report onForm 8-K dated July 25, 2007).
	10	.22†	Amended and Restated Thomas & Betts Corporation Executive Retirement Plan (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.23†	Amended and Restated Thomas & Betts Corporation Management Incentive Plan (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.24†	Amended and Restated Thomas & Betts Corporation Pension Restoration Plan (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.25†	Amended and Restated Thomas & Betts Corporation Supplemental Executive Investment Plan (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.26†	Amended and Restated Termination Protection Agreement (Pileggi) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.27†	Amended and Restated Termination Protection Agreement (Fluke) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).

E-3


Exhibit No.			Description of Exhibit

	10	.28†	Amended and Restated Termination Protection Agreement (Hajj) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.29†	Amended and Restated Termination Protection Agreement (Hartmann) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.30†	Amended and Restated Termination Protection Agreement (Raines) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.31†	Amended and Restated Termination Protection Agreement (Locke) (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.32	Amended and Restated Thomas & Betts Corporation Indemnification Agreement (Incorporated by reference to Items 1.01 and 5.02 of the Registrant’s Current Report onForm 8-K dated September 11, 2007).
	10	.33	Second Amended and Restated Credit Agreement dated October 16, 2007, among Thomas & Betts Corporation, as Borrower, the Lenders party hereto, and Wachovia Bank, N.A., as Administrative Agent, and Wachovia Capital Markets, LLC and Banc of America Securities LLC, as Joint Lead Arrangers and Joint Book Runners (Incorporated by reference to Items 1.01 and 2.03 of the Registrant’s Current Report onform 8-K dated October 17, 2007).
	10	.34†	Separation Agreement and General Release between Christopher P. Hartmann and Thomas & Betts Corporation dated effective January 4, 2008 (Filed as Exhibit 10.16 to the Registrant’s Current Report onForm 8-K dated December 20, 2007, and incorporated herein by reference).
	10	.35†	Health Benefits Continuation Agreement dated September 5, 2007 between Thomas & Betts Corporation and Dominic J. Pileggi (Filed as Exhibit 10.14 to the Registrant’s Current Report on From8-K dated September 11, 2007 and incorporated herein by reference).
	10	.36†	The Thomas & Betts Corporation Supplemental Executive Investment Plan, Amended and Restated effective as of January 1, 2007 Incorporating Amendments through December 20, 2007.
	10	.37†	The Thomas & Betts Corporation Management Incentive Plan, as Amended and Restated effective January 1, 2009 (Filed as Exhibit 10.41 to the Registrant’s Current Report onForm 8-K dated May 7, 2008 and incorporated herein by reference).
	10	.38†	The Thomas & Betts Corporation 2008 Stock Incentive Plan (Filed as Exhibit 10.42 to the Registrant’s Current Report onForm 8-K dated May 7, 2008 and incorporated herein by reference).
	10	.39†	Form of Restricted Stock Agreement pursuant to the Thomas & Betts Corporation 2008 Stock Incentive Plan.
	10	.40†	Form of Nonqualified Stock Option Agreement pursuant to the Thomas & Betts Corporation 2008 Stock Incentive Plan.
	10	.41†	Form of Restricted Stock Agreement for Nonemployee Directors pursuant to the Thomas & Betts Corporation 2008 Stock Incentive Plan.

E-4


Exhibit No.			Description of Exhibit

	10	.42†	Form of Nonqualified Stock Option Agreement for Nonemployee Directors pursuant to the Thomas & Betts Corporation 2008 Stock Incentive Plan.
	10	.43†	Minority Stock Purchase Agreement, dated as of June 24, 2008 among Thomas & Betts, and Leviton (Filed as Exhibit 10.1 to Registrant’s Current Report onForm 8-K dated June 24, 2008).
	10	.44†	Termination Protection Agreement, effective December 3, 2008, between William E. Weaver, Jr. and Thomas & Betts Corporation (Filed as Exhibit 10.1 to Registrant’s Current Report ofForm 8-K dated December 3, 2008 and incorporated herein by reference).
	10	.45†	Executive Retirement Plan, as Amended and Restated Effective January 1, 2005, Including Amendments and Appendix A Adopted through December 3, 2008.
	10	.46†	Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and Dominic J. Pileggi dated December 16, 2008.
	10	.47†	Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and Kenneth W. Fluke dated December 30, 2008.
	10	.48†	Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and Imad Hajj dated December 16, 2008.
	10	.49†	Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and J.N. Raines dated December 16, 2008.
	10	.50†	Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and William E. Weaver, Jr. dated December 30, 2008.
	10	.51†	First Amendment to the Amended and Restated Termination Protection Agreement between Thomas & Betts Corporation and Stanley P. Locke dated December 19, 2008.
	10	.52†	First Amendment to the Thomas & Betts Supplemental Executive Investment Plan Effective January 1, 2008.
	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 ActRules 13a-14(a) or 15d-14(a).
	31	.2	Certification of Principal Financial Officer under Securities Exchange ActRules 13a-14(a) or 15d-14(a).
	32	.1	Certification of Principal Executive Officer Pursuant toRule 13a-14(b) orRule 15d-14(b) of the Securities Exchange Act of 1934 and furnished solely pursuant to 18 U.S.C. § 1350 and not filed as part of the Report or as a separate disclosure document.
	32	.2	Certification of Principal Financial Officer Pursuant toRule 13a-14(b) orRule 15d-14(b) of the Securities Exchange Act of 1934 and furnished solely pursuant to 18 U.S.C. § 1350 and not filed as part of the Report or as a separate disclosure document.


†		Management contract or compensatory plan or arrangement.

E-5

Positive
Negative
Uncertain
Constraining
Legalese
Litigious
Readability	7th grade Avg

Thomas & Betts (TNB) Inactive 10-K2008 FY Annual report

Content analysis